CURRENT NEWS
Vienna, 25 August 2006
PRESS RELEASE NO. 4/2006
CONTINUED GROWTH IN 2006 FOR SEMPERIT
GROUP SALES ROSE BY 10.4% TO €283.9 MLN IN FIRST HALF OF YEAR
The industrial group of Semperit AG Holding continued along its course of growth again in the first half of 2006, increasing consolidated sales over the same period the year before by some 10.4 % to €283.9 million. The consolidated profit rose by 3.7 % to €19.5 million whereas profit before tax (PBT) declined by 7.3 % to €26.1 million.
The curtailed earnings are mainly attributable to another massive upsurge in the price of latex, our key raw material. Many other raw materials and energy sources have also gone up in price, in some cases substantially. Until now, we have not been able to pass on these multiple cost burdens fully and immediately to our customers.
NEW MANUFACTURING CAPACITIES IN ASIA
In Asia, we again pushed the construction of new production facilities and the expansion of existing ones in the first half of the year to solidify our position on global markets. A factory for medical gloves in Hatyai/Thailand is slated for completion in the second half of the year. It will be the third such factory at this site. Construction on our first Chinese factory for manufacturing hydraulic hose is progressing apace in Shanghai. A new handrail production plant of Shanghai Semperit Rubber & Plastic Products Co. Ltd. (SRP) is also now going up adjacent to the Semperflex factory.
CAPACITIES AT SEMPERMED FACTORIES FULLY UTILISED
Sempermed made full use of divisional capacities in the first half of the year despite a substantial expansion of capacity at all production locations.
Medical glove production at the main plant in Wimpassing, Austria, profited from the dynamic European market, which boosted business in standard surgical gloves and higher end quality products.
Cost cuts in operations at Hatyai/Thailand and at Shanghai Foremost in China helped to improve earnings.
SEMPERFLEX BENEFITS FROM CYCLICAL RISE IN INDUSTRIAL HOSE BUSINESS
Lively demand for industrial hose was the main driver of business growth in the Semperflex Division. Sales of hydraulic hose rose only slightly, however, with the progress in the Western European markets and America being offset by stagnation in Eastern Europe and declines in Asia.
The main plant in Wimpassing, Austria, reported full utilization of capacity in its industrial hose production operations and a considerable rise in sales. The sales volume of elastomer sheeting was increased.
Capacity utilization of industrial hose production operations at the Czech factory Semperflex Optimit increased dramatically. The Italian subsidiary Semperflex Roiter also reported better use of capacities than the year before. The upswing was due to a restructuring of sales activities, which improved the order situation and the value of sales. The Thai hose factories, for their part, faced operational problems that cut into output.
WELCOME TREND AT SEMPERFORM
Semperform reported solid business growth in nearly all production areas in the period under review. However, raw materials rose substantially in price, pushing costs up dramatically in certain areas. As a result, the division was unable to pass these higher costs on to customers in full despite increases in its own prices.
Business in moulded goods and elastomer profiles at the Wimpassing plant was dominated by the production of sheave liners for cable cars, pipes and railroad car products. Additional project transactions boosted railroad track business.
The German factory Gummiwerk Deggendorf profited from the slight upturn in German construction but grew at a much faster pace than the sector as a whole.
Semperform Hungary sustained its positive trend after the restructuring begun in 2005 with more streamlined operations and substantial increases in productivity. Handrail production in Shanghai benefited from lively business in the initial equipping of escalators and moving sidewalks. The Thai group company Semperform Pacific achieved its business growth target.
SEMPERTRANS PUSHES DEVELOPMENT OF GROWTH MARKETS
The dynamic business trend at Sempertrans continued unabated. The Polish conveyor belt factory Sempertrans Belchatow utilized the new capacities with the 3.2 m press to a high degree and expanded output accordingly. In its marketing efforts, the division focused on developing and expanding growth markets in Eastern Europe, Asia and Australia.
Basic conditions remained unfavorable at the French conveyor belt manufacturer S.F.B.T., with high labor costs in France and price competition for standard products dominating the scene. However, the company did feel the first positive effects of the restructuring now underway. Though somewhat confined by full capacity utilization, the Indian group company Sempertrans Nirlon further expanded output through a remarkable increase in productivity to meet the large influx of new orders.
EXPANSION WILL CONTINUE IN 2006
The management expects Semperit to sustain its current course of sales growth for 2006 as a whole. The unpredictable price trend for latex and other raw materials continues to be a source of major uncertainty, as is the ongoing volatility of key currencies like the US dollar and the Thai baht.
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