WILO-SALMSON AG is now WILO AG

31.05.2002

Group sales surpassed half-a-million euros for the first time. Successful continuation of the international expansion strategy. Contribution to overall revenue from Asia up from 4 to 17 percent. Another increase in the volume of investments. Group restructuring measures in 2002. Further growth anticipated in the current year.

Dortmund/Düsseldorf, May 7, 2002. Sales revenue is up 23.0 percent at the WILO-SALMSON Group, one of the world’s leading pump manufacturers, which means that the company remained firmly on course for growth in 2001. The European-Asian group of companies, consisting of the independent subsidiaries, POMPES SALMSON S.A.S. and WILO-SALMSON COMPONENTS S.A.S. (WSC), both in France, and WILO-LG Pumps Ltd. in Korea, increased its consolidated group sales from EUR 432 million in the prior year to the highest level yet of EUR 536 million. 18.5 percent of the 23 percent increase in group sales was realized through the acquisition of WILO-LG in Korea.

Horst D. Elsner, CFO: “This result by far surpassed our expectations. It shows that our growth is based, first and foremost, on our consistent adherence to our international expansion strategy.” The pump manufacturer’s net income for the year increased from EUR 15.5 to 20.9 million or 3.9 percent of sales revenue . The volume of investments increased from EUR 32.1 million to EUR 34.7 million; EUR 16.1 million of which was in respect of research and development activities.

Despite the negative sector trend, the WILO-SALMSON Group succeeded in increasing sales revenue in the German market by EUR 121.4 million or 5.3 percent. The group has gained market share by focusing on the business areas of refrigeration/air-conditioning, industrial applications and solar energy. Sales revenue in France was EUR 72.5 million, which is 2.4 percent higher than in the prior year. Both domestic markets now only contribute 36.2 percent of group sales revenue because the contribution from Asia has increased from 4 to 17 percent.

Growth through international expansion

The WILO-SALMSON Group has responded to stagnation in the heating equipment sector of its domestic markets by expanding in growth regions. These include southern and eastern Europe and, most importantly, Asia. These markets offer promising sales opportunities in the fields of air-conditioning, water supply and sewage disposal. The acquisition of WILO-LG Ltd. in Korea, which was originally

the pump division of the LG Group, has enabled the group to advance to market leader in Korea. WILO-LG and WILO GmbH also have subsidiaries in China which provide the group with an ideal foothold in the Asian market.

Streamlining group structure in 2002

Progressive international expansion necessitates transparent structures and fast decision-making. This is why, with retroactive effect as of January 1, 2002, WILO GmbH merged with WILO-SALMSON AG and changed its name to WILO AG. “A streamlined group organization enables us to respond promptly and flexibly to individual customer requirements within changing markets,” said Horst D. Elsner, who will be responsible in future for sales and marketing at WILO AG.

Investments in innovative products

The WILO-SALMSON Group is still focused on developing, producing and marketing energy-saving and thus user-friendly pumps in accordance with customer requirements. At the International Sanitation, Heating and Air-Conditioning Fair (ISH) in Frankfurt, the group showcased the new Stratos range of pumps, which are used in the building sector for heating and refrigeration applications. With a new drive concept and their electronic control units these pumps use up to 80 percent less energy in comparison with conventional standard pumps. The electronic know-how is pooled and further developed at the recently-established ‘Electronic Competence Center’ in Dortmund for the benefit of the entire group.

Growth is also anticipated in 2002

The WILO-SALMSON Group also forecasts an increase in sales revenue and profits in 2002. Developments in the domestic markets of Germany and France will continue to be overshadowed by the crisis in the building sector. The group will increase its market share in the refrigeration/air-conditioning, water supply and sewage water disposal sectors. It anticipates further substantial growth in eastern and southern Europe, as well as in Asia. This is why it will continue to pursue its strategy of international expansion and extend its existing activities in these growth markets. With the Korean WILO-LG we strive for additional market shares in Asia. The growth outlook for eastern Europe is also positive, especially in the former CIS states.

Background information

The WILO Group develops, produces and markets pumps and pump systems world-wide for heating, refrigeration and air-conditioning systems, as well as for water supply, sewage water disposal and heating equipment manufacturers. In addition to the management holding company, WILO AG, the group consists of three independent companies: POMPES SALMSON S.A.S. and WILO-SALMSON COMPONENTS S.A.S. (WSC), both in France, and WILO-LG Pumps Ltd. in Korea. The group markets the brands of WILO and SALMSON, with eight production facilities in five countries and 36 marketing subsidiaries in 32 countries. It presently has 3,052 employees. The European-Asian WILO Group is one of the world’s leading manufacturers of pumps. The members of the management board at WILO AG,

which has its head office in Dortmund, are:

Michel Laroche (Chairman),

Dr. Horst D. Elsner (Sales/Marketing),

Frank Kaiser (Quality Assurance/Product Business Units Germany) and

Jerôme Perrod (Product Business Units France).

Source: WILO SE

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