Very positive cash flow for BWT

24.11.2008

The Best Water Technology Group (BWT) recorded a decrease in earnings in the third quarter, while revenue increased only slightly. Strong cash flow from operating activities led to a significant reduction in net debt.

“The third quarter has led us into rough waters; balance sheet and cash flow demonstrate that BWT is a solid ship. We can introduce a couple of unique innovations to our customers and will emerge much stronger out of this environment. In the group as well as in our market, water technology for households and businesses, opportunities arise for long term sustainable success,” says Andreas Weissenbacher, CEO of the BWT Group.

In the first three quarters of 2008, the BWT Group grew its consolidated revenue by 7.7% from € 289.3 million to € 311.6 million. The growth rate fell in the third quarter while revenue grew by 1.9%.

BWT lifted its revenue in the Point-of-Entry business by 6.4%, while the Point-of-Use products generated an increase in revenue of 42% compared with the same period of the previous year chiefly as a result of the good performance of the BWT-water & more coffee machine filters.

Lower revenue growth, an unfavorable product mix, the absence of extraordinary income as well as start-up costs for the launch of the Point-of-Use program negatively impacted the BWT Group’s earnings, particularly in Q3 2008. At € 5.0 million, EBIT for Q3 was down 36.5% year-on-year (€ 7.8 million); total EBIT was € 25.8 million, representing a dip of 9.5% as against the previous year’s figure of € 28.6 million.

After nine months, EBT amounted to € 25.2 million; compared with the previous year’s figure of € 28.7 million, this represents a drop of 12.4%. After the first three quarters the BWT Group generated net profit for the period after minority interests of € 18.6 million compared with € 20.1 million in the previous year. Earnings per share were € 1.04 against € 1.13 in the comparable period of the previous year.

Outlook

The performance in Q3, the difficult economic climate in major markets and continued consistent implementation of growth initiatives in the Point-of-Use business give the BWT Management Board cause to lower its revenue and earnings forecast for 2008. In line with the most recent assessment for the 2008 fiscal year, we anticipate consolidated revenue growth of 3% (previous year: € 397 million) and consolidated net profit for the period of over € 20 million (previous year: € 26 million).

During the current share buyback program a total of close to 300,000 own shares were bought back with a value of roughly € 5 million. Effective today, the price range is increased to €1 to €99 according to the resolution of the Annual General Meeting due to the persistent market volatility.

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