In the 2005/06 fiscal year, the HIRSCH Servo Group succeeded in achieving a sustained turnaround. It increased operating profit (EBIT) by 177% to hit an all-time high of 6.6 MEUR. The profit on ordinary activities (POA) was tripled and the earnings per share rose by 87%. The largest investment program in the company’s history at 12.4 MEUR was primarily due to the acquisition of Polyform s.r.o. in Slovakia, the plant extension in Wroclaw (Poland) and the greenfield investment in Cluj (Romania). High energy prices resulted in strong demand, especially for EPS insulation and EPS processing machinery.
The primary business segment of EPS Processing saw the POA remaining at the previous year’s level of 2.9 MEUR in spite of exchange losses from the Hungarian forint of 0.65 MEUR. At 4.6 MEUR (previous year 3.4 MEUR), the operating profit (EBIT) showed an all-time high and therefore a strong increase in performance. High energy prices led to rising demand for EPS insulating materials and EPS packaging, thus enabling an organic growth in sales of over 20%. If the sales from the newly acquired companies in Slovakia are included, a rise of 30% to 44.8 MEUR (PY 34.5 MEUR) can be reported.
In the Machinery and Plant Engineering business segment, the POA showed a return to the black increasing by over 1.8 MEUR from -0.2 MEUR to +1.7 MEUR. The main factors behind this turnaround are to be found in the comprehensive cost cutting programs, particularly in block machines, and the higher sales achieved. Sales grew by 22% from 19.5 MEUR to 23.8 MEUR.
The annual net income climbed to 3.6 MEUR (PY 1.9 MEUR) and the earnings per share to 7.44 euros (PY 3.99 euros).
Cash flow from operating activities rose to 5.2 MEUR (PY 4.4 MEUR).
On the reporting date June 30, 2006, the HIRSCH Servo Group employed 500 people. The annual average rose to 478 (PY 417 people) with the increase in headcount coming from Eastern Europe.
Investment in expansion to the east was the highest to date at 12.4 MEUR (PY 9.5 MEUR) and will also play an important role in the Group’s future development. As a result of the plant expansion in Wroclaw (Poland), acquisition of the companies in Slovakia and the new facility built in Cluj (Romania), annual production capacity in the EPS Processing business segment rose from 15,000 to 25,000 tonnes.
The Board will submit a proposal to the 11th Annual General Meeting to increase the dividend to 3.20 euros per share (PY 1.10 euros).
Outlook
Management confirms the encouraging outlook for the 2006-07 financial year. Given the consistent implementation of the corporate strategy and ongoing favorable market environment, the POA should rise by 15% from 4.6 MEUR to 5.3 MEUR and the earnings per share from 7.44 euros to 8.60 euros.
To make shares even more attractive both for existing shareholders and new international investors, the HIRSCH Servo Group is planning to return to the Vienna Stock Exchange’s prime market on October 23, 2006 following three years in the auction market. Good growth prospects thanks to the Group’s position in Central and Eastern Europe, its attractive dividend policy and listing on the prime market should promote stock sales. To increase the free float, HIRSCH Servo AG is planning to sell 15,000 of its own shares, which will be put forward to the 11th Annual General Meeting for approval on November 20, 2006.
Fiscal 2005/06
|
|
Fiscal |
Fiscal |
Change |
|
Sales |
57,198 |
68,724 |
+20 |
|
EPS Processing |
34,490 |
44,840 |
+30 |
|
Machinery and Plant Engineering |
19,486 |
23,774 |
+22 |
|
Presentation Systems |
3,194 |
0 |
- |
|
Other activities |
27 |
110 |
- |
|
EBITDA |
5,699 |
10,104 |
+77 |
|
EBIT |
2,370 |
6,566 |
+177 |
|
POA |
1,428 |
4,577 |
+221 |
|
EPS Processing |
2,920 |
2,891 |
0 |
|
Machinery and Plant Engineering |
-163 |
1,666 |
- |
|
Presentation Systems |
-843 |
0 |
- |
|
Other activities |
-486 |
20 |
- |
|
Annual net income |
1,933 |
3,607 |
+87 |
|
Earnings per share (in EUR) |
3.99 |
7.44 |
+87 |
|
Investment |
9,507 |
12,371 |
+30 |
|
Cash flow from operating activities |
4,350 |
5,168 |
+19 |
|
Equity |
20,589 |
23,478 |
+14 |
|
Equity ratio in % |
36.5 |
32.5 |
- |
|
Balance sheet total |
56,362 |
72,332 |
+28 |
|
Average price (in EUR) |
40.78 |
57.76 |
+42 |
|
P/E ratio as at June 30 |
9 |
12 |
+33 |
|
Dividend yield in % as at June 30 |
3.0 |
3.6 |
- |
The next date on the financial calendar is October 31, 2006 when the results for the first quarter of 2006/07 will be announced.
*The HIRSCH Servo Group is the EPS specialist on the Vienna Stock Exchange with manufacturing facilities in Austria, Hungary, Poland, Slovakia, Italy and Romania. EPS products (EPS stands for expandable polystyrene and is better known under such brand names as Porozell® or Styropor®) support a variety of functions, including energy savings, as well as sustainable and eco-friendly growth. Their wide-ranging applications cover packaging, shape-molded parts, building insulation, modular boards for underfloor heating, construction blocks and Thermozell® lightweight concrete products.
For further information, please contact Michaela Promberger, Tel: +43 4277 2211-312,
Fax: +43 4277 2211-370, E-mail: michaela.promberger@hirsch-gruppe.com,
www.hirsch-gruppe.com