DGAP-News: Balda reports profitable growth for first nine months of 2012/2013

07.05.2013

DGAP-News: Balda AG / Key word(s): Quarter Results

Balda reports profitable growth for first nine months of 2012/2013

07.05.2013 / 09:43

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Balda Aktiengesellschaft * Bergkirchener Str. 228 * 32549 Bad Oeynhausen

PRESS RELEASE

Balda reports profitable growth for first nine months of 2012/2013

– All Group operations in the black following the disposal of the

Malaysian site

– Positive earnings trend in operating business stabilized: EBITDA before

extraordinary items at EUR 2.6 million after nine months

– Consolidated sales from continuing operations are EUR 35.6 million, up

21.1% year-on-year

– High consolidated profit of EUR 22.2 million (continuing operations)

due to effects from the sale of the remaining shares in TPK Holding

– Integration of the acquired US plastics specialists progresses

– Guidance for the full 2012/2013 year adjusted to new Group structure

Bad Oeynhausen, 7 May 2013 – The Balda Group today announced that the

positive trend in operations seen in the first half of the year stabilized

in the third quarter of the 2012/2013 financial year (1 January 2013 to 31

March 2013). After the disposal of the site in Ipoh/Malaysia with economic

effect as of 31 March 2013, all Group operations are now profitable.

Consolidated sales from continuing operations stood at EUR 35.6 million in

the three quarters, 21.1% higher than the comparative figure recorded in

2011/2012. Profit from operations adjusted for extraordinary items

(adjusted EBITDA) amounted to EUR 2.6 million. Due to the effects from the

sale of the remaining shares in TPK Holding in the third quarter, Balda

shows a consolidated profit from continuing operations of EUR 22.2 million.

Dominik Müser, Chief Executive Officer of Balda AG: ‘Balda is evolving with

increasing speed in terms of growth and value enhancement. Following a

turbulent 2012 calendar year, which was dominated by external

uncertainties, the acquisition of the US companies Balda C. Brewer and

Balda HK Plastics, the disposal of the Malaysian operation and the sale of

the remaining shares in TPK were milestones on this path. The integration

of our new US companies is making good progress. They already made a

significant contribution to sales and earnings in the third quarter. I am

also pleased to see that the capital market does appreciate the strategic

and operational advances made by Balda. After all, the value of our share

adjusted for dividend payments has increased by more than 80 percent since

the start of 2012.’

Remarks on the interim consolidated financial statements as of 31 March

2013

– The US companies Balda C. Brewer and Balda HK Plastics acquired in late

2012 were consolidated as of 31 December 2012. Their sales and earnings

are therefore included in the figures for the third quarter.

– Balda Solutions Malaysia Sdn. Bhd. (BSM), Ipoh/Malaysia, which was sold

with economic effect as of 31 March 2013, is no longer included in the

income statement for continuing operations; the previous year’s figures

were adjusted accordingly. The disposed company’s earnings for the

first nine months are shown separately under earnings after taxes from

discontinued operations. The item for the prior-year period also

includes the MobileCom segment disposed of on 1 December 2011, which

limits the feasibility of making direct comparisons.

Key sales and earnings figures of the Balda Group for the first nine months

of 2012/2013

– Consolidated sales (continuing operations) in the first nine months of

the 2012/2013 financial year stood at EUR 35.6 million, up 21.1% on the

figure for the prior-year period (EUR 29.4 million). This increase can

be attributed to the contribution to sales from the US companies that

were consolidated in the third quarter for the first time.

– After adjusting for extraordinary items, the consolidated earnings

before interest, taxes, depreciation and amortization (EBITDA) of the

continuing operations in the first nine months amounted to EUR 2.6

million, up from EUR -3.3 million in the comparative period. The

extraordinary items that were incurred mainly in the first half of the

year are non-recurring, non-capitalizable expenses, especially for the

extensive M&A processes (transaction and due diligence costs) carried

out under the Group’s buy and build strategy. Adjusted EBITDA amounted

to EUR 0.6 million in the third quarter (prior-year period: EUR -1.5

million).

– EBITDA including extraordinary items improved to EUR 0.5 million after

nine months (prior-year period: EUR -4.8 million).

– Net finance income totaled EUR 25.1 million after nine months

(prior-year period: EUR 132.7 million). Net finance income in both

periods was influenced to a considerable extent by the proceeds from

the sales of TPK shares. This item also includes positive exchange rate

effects from the translation of foreign currencies from the Group’s

high cash holdings.

– Earnings after taxes from continuing operations were EUR 22.2 million,

down from EUR 124.2 million in the period from July 2011 to March 2012.

Of this amount, EUR 10.6 million is attributable to the third quarter

(January to March 2012: EUR 134.5 million).

– The net loss from discontinued operations, which relates to the sold

Balda Solutions Malaysia Sdn. Bhd. (BSM), amounted to EUR 10.3 million

in the nine-month reporting period. This results from the operating

loss of the Malaysia business as well as from the non-cash write-down

of assets to their fair value. The figure for the prior-year period

(loss of EUR 14.4 million) also included the loss incurred from the

MobileCom operation, which was discontinued as of 1 December 2011.

– Comprehensive income for the Group (sum total of continuing and

discontinued operations) after nine months was EUR 11.9 million, down

from EUR 109.8 million in the period from July 2011 to March 2012.

– Comprehensive income for the first nine months corresponds to earnings

per share (basic EPS and diluted EPS) of EUR 0.20 (prior-year period:

EUR 1.87).

Segment performance

– At EUR 30.3 million, 2012/2013 sales of the Balda Medical segment after

nine months were 3.0% higher than the figure for the prior-year period

(EUR 29.4 million). The sales of the US companies consolidated in the

third quarter for the first time had a positive effect. EBITDA totaled

EUR 4.0 million and was thus approx. 44% higher than the prior-year

figure of EUR 2.8 million. The segment’s operating profit margin

improved from 8.5% to 12.0% of gross revenue.

– The Balda Technical segment posted sales of EUR 5.3 million for the

first nine months of the 2012/2013 financial year (prior-year period:

EUR 0), due exclusively to revenue generated by the new US companies.

Sales from the operations in Malaysia are no longer listed as these

were reclassified to discontinued operations. Segment EBITDA amounted

to EUR 0.3 million in the reporting period.

– The Balda Central Services segment, which mainly comprises the holding

company functions of Balda AG, saw its EBITDA for the first nine months

improve to EUR -3.5 million, compared with EUR -9.6 million in the

2011/2012 comparative period. The streamlining of the Group’s

structures and other cost savings had a positive effect. Earnings

before taxes (EBT) after nine months came in at EUR 21.5 million

(2011/2012 comparative period: EUR 123.7 million). This was due

primarily to income from the sale of the remaining shares in TPK

Holding and net foreign currency gains.

Adjusted outlook for the full 2012/2013 year

The Management Board’s confirms its objective to guide the Balda Group

towards sustainable growth and value enhancement. In the medium term,

efforts will focus on achieving consolidated sales of EUR 150-200 million,

combined with an operating profit margin (in terms of EBITDA) of at least

15%.

The Management Board has adjusted its 2012/2013 planning to the modified

Group portfolio. Based on the current portfolio, the Management Board

expects to record

– consolidated sales from continuing operations in the area of EUR 60 to

65 million and

– distinctly positive EBITDA from continuing operations both before and

after extraordinary items.

The Group’s profitability before and after taxes will be strongly boosted

by positive net finance income and the proceeds from the sale of the

remaining TPK stake. As a result, both the earnings after taxes from

continuing operations and the Group’s comprehensive income are expected to

be clearly positive.

Notes to the editors:

The Balda Group’s interim financial statements as of 31 March 2013 can be

downloaded from the company’s website at www.balda.de.

Contact:

Frank Elsner

Frank Elsner Kommunikation für Unternehmen GmbH

Tel.: +49 – 54 04 – 91 92 0

Fax: +49 – 54 04 – 91 92 29

Mail:office@elsner-kommunikation.de

The Balda Group at a glance

in EUR million 9 months 9 months Q3 Q3

1.7.2012 – 1.7.2011 – 1.1.2013 1.1.2012

31.3.2013 * 31.3.2012 * – –

31.3.2013 31.3.2012

Sales, continuing operations 35.6 29.4 19.7 6.0

of which Balda Medical

of which Balda Technical 30.3 29.4 14.4 6.0

5.3 — 5.3 —

Gross revenue 39.9 32.0 18.6 8.6

EBITDA before extraordinary 2.6 -3.3 0.6 -1.5

items**

EBITDA margin before 6.5 -8.3 3.2 -18.6

extraordinary items**

EBITDA after extraordinary 0.5 -4.8 0.4 -1.6

items 4.0 2.8 2.0 0

of which Balda Medical 0.3 0 0.3 0

of which Balda Technical

of which Balda Central -3.5 -9.6 -1,9 -1.6

Services***

EBIT before extraordinary 0,2 -4.8 -0,8 -2.0

items**

EBIT margin in % before 0,5 -15.0 -4.3 -23.3

extraordinary items**

EBIT after extraordinary items -2.0 -6.3 -1.0 -2.2

Net finance income 25.1 132.7 12.5 136.9

Earnings before tax 23.1 126.4 11.5 134.7

Earnings after taxes, 22.2 124.2 10.6 134.5

continuing operations

Earnings after taxes, -10.3 -14.4 -10.5 -0.9

discontinued operations****

Comprehensive income, group 11.9 109.8 0 133.6

Earnings per share (EUR) 0.20 1.87 0 2.27

31.3.2013 30.6.2012

Total assets 377.6 473.4

Equity 340.9 450.5

Equity ratio (%) 90.3 95.2

Employees (number at 949 220

reporting date, continuing

operations)

* The comparative figures for the nine-month period correspond to the

second half of the 2011 financial year

and the first quarter of the short 2012 financial year.

** The figures for 2012/2013 have been adjusted for non-capitalizable

non-recurring items for M&A processes

and the modernization of Group IT.

*** 2011/2012: including expenses attributable to the former MobileCom

segment.

**** Corresponds to the net profit/loss of Balda Solutions Malaysia Sdn.

Bhd. (sold effective 31 March 2013).

Comparative period 2011/2012 also includes net profit/loss from the

discontinued MobileCom operation.

End of Corporate News

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07.05.2013 Dissemination of a Corporate News, transmitted by DGAP – a

company of EquityStory AG.

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Language: English

Company: Balda AG

Bergkirchener Str. 228

32549 Bad Oeynhausen

Germany

Phone: +49 (0) 57 34 / 9 22-0

Fax: +49 (0) 57 34 / 9 22-2604

E-mail: info@Balda.de

Internet: www.balda.de

ISIN: DE0005215107

WKN: 521510

Listed: Regulierter Markt in Frankfurt (Prime Standard);

Freiverkehr in Berlin, Düsseldorf, Hamburg, Hannover,

München, Stuttgart

End of News DGAP News-Service

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209935 07.05.2013