PDF, 1.2 MB - Pfleiderer AG

management report company report pfleiderer ag 19
high sales volumes and strong exports. Continued pressure on prices in Germany has had a
sustained effect on the Company’s earnings position for this business center. On the other
hand, the Infrastructure Technology Business Center recorded satisfactory business in 2002
thanks to its strong position and the stability of the market it serves.
Earnings before interest, taxes, depreciation and amortization (EBITDA) fell by 22.3 percent
to 109.5 million euros (2001: 140.9 million euros). Earnings before interest and taxes
(EBIT) for continued operations came to 48.9 million euros for the Pfleiderer Group (2001:
77.9 million euros). This reflects the generally lower margins due to market conditions in the
German engineered wood business. Earnings before taxes (EBT) for continued operations
came to 33.6 million euros, 39.1 percent lower than the previous year (55.2 million euros).
Non-recurring special effects amounting to 52.5 million euros due to disposals and the
presentation of discontinued operations – Doors and Windows, Insulation Technologies, Wind
Power, Tipla and Eltec – are shown under “Results of discontinued operations”. This figure
includes expenses of 8.0 million euros incurred for research and development, less a subsidy
of 1.3 million euros, for the Wind Power Business Unit, producing a result after minority
interests of –39.7 million euros (2001: 24.2 million euros).
Cost of materials, including changes to inventories, came to 48.5 percent of sales in
2002, a significant increase compared to the previous year (43.4 percent). On one hand this
was due to price-related effects from changes in inventories. On the other hand, the procurement
department was not able to balance the decline in sales margins in spite of greater
efforts.
At around 15 million euros, personnel expenses as a percentage of sales were slightly
lower at 23.6 percent, despite lower sales (2001: 24.7 percent). However, greater cost saving
measures in the personnel area more than compensated for the effect of lower margins and
a three-percent salary increase.
Depreciation and amortization as a percentage of sales remained largely unchanged at
5.9 percent (2001: 6.0 percent)
Net interest improved over the previous year by 0.7 percent of sales. Interest charges
were reduced by repaying loans carrying interest rates above the average rates of other Group
liabilities.