- At EUR1,394 million, sales revenues are 2.1 % above previous year
- Earnings after tax of EUR110.3 million
- Dividend set to be increased to EUR1.60 per preference share
Performance
The organic growth of the FUCHS PETROLUB Group in 2008 was price-driven. In total, the Group recorded an organic increase in revenues of EUR72.5 million or 5.3 % for the whole year. While it was possible to achieve appreciable increases in volume in the first half of the year, the poor economic climate meant that sales in the fourth quarter were significantly below the previous year's level. By the end of the year, the previous year's volume was only just achieved.
In 2008 the FUCHS PETROLUB Group recorded its second best earnings ever, although it was not possible to repeat the record profits of 2007. This was due to the collapse in the global economy caused by the financial market crisis in the second half of 2008, which was particularly severe in the fourth quarter of 2008.
Yet despite this, the Group managed to record satisfactory earnings in 2008. EBIT was EUR171.7 million (195.2) and profit after tax was EUR110.3 million (120.3). The fall in total earnings equates to 4.3 % in terms of earnings per share due to the reduced number of shares caused by the share buyback program.
The FUCHS PETROLUB Group starts 2009 in a solid financial position. Despite the buyback of shares the equity ratio at 44.8 % (45.6) saw little change in the reporting year.
As a result of severe increases in raw material prices, a downward trend in sales revenues in the fourth quarter, tax payments and greater capital expenditures, the free cash flow decreased to EUR7.5 million (128.4).
Capital expenditure
The FUCHS PETROLUB Group dedicated EUR46.6 million (24.4) to capital expenditure in property, plant and equipment and intangible assets in 2008. The reason for the significant increase compared to the previous years was the launch of the investment program announced in mid 2008 which covers the two German sites in Mannheim and Kaiserslautern as well as China, India and Brazil.
Employees
As at December 31, 2008, the FUCHS PETROLUB Group employed 3,855 people worldwide (3,787). The total number of employees has therefore increased slightly year on year by 68 people or 1.8 %.
Proposed dividend
The Supervisory Board and Executive Board will propose to the Annual General Meeting on May 6, 2009 that the dividend for 2008 be raised by EUR0.10 per share to EUR1.60 (1.50) per preference share and EUR1.54 (1.44) per ordinary share compared to the previous year. This would mean the total dividend payout is at around the same level as the previous year. However, when the share buyback is taken into account, this represents an increase in dividend per share of 7 %.
Forecast
Business development in the first two months of 2009 continued to be generally unsatisfactory. The customers of FUCHS continue to reduce their inventories and are ordering less in the light of their own weak order situation.
FUCHS begins 2009, which will certainly be a difficult year, in robust condition and is confident of its proven business model. Due to the worldwide recession, downward trends in sales revenues are to be expected in all regions in 2009. Further, it may be assumed that the previous year's results will not be reached. FUCHS will also continue to work on potential weak areas, continue its disciplined system of cost management and take all measures necessary. Despite the extremely difficult economic situation, the FUCHS PETROLUB Group still sees opportunities for further expanding its market position and making the most of sensible acquisition opportunities both strategically and financially. In terms of cash development, the Group seeks to continue the good cash flow generation of the previous years.
Key figures of the Group
| 2008 | 2007 | |
|---|---|---|
| Sales revenues (1) | EUR1,393.7 million | EUR1,365.3 million |
| Europe | EUR945.0 million | EUR934.1 million |
| North and South America | EUR205.9 million | EUR208.3 million |
| Asia-Pacific, Africa | EUR274.9 million | EUR253.4 million |
| EBIT | EUR171.7 million | EUR195.2 million |
| Profit after tax | EUR110.3 million | EUR120.3 million |
| Earnings per share | ||
| Ordinary share | EUR4.43 | EUR4.63 |
| Preference share | EUR4.49 | EUR4.69 |
| Dividends | ||
| Ordinary share (2) | EUR1.54 | EUR1.44 |
| Preference share (2) | EUR1.60 | EUR1.50 |
| Free cash flow | EUR7.5 million | EUR128.4 million |
| Capital expenditure (3) | EUR46.6 million | EUR24.4 million |
| Employees (as at December 31) | 3,855 | 3,787 |
(1) By company's location
(2) Dividend proposal 2008 to the Annual General Meeting on May 6, 2009
(3) In property, plant and equipment and intangible assets
Mannheim, March 27, 2009
FUCHS PETROLUB AG
Public Relations
Friesenheimer Str. 17
68169 Mannheim
Germany
Tel.: +49 (0) 621 3802-124
The listed information below can be found in the internet with the following links:
Press release: www.fuchs-oil.com
Annual Report 2008: www.fuchs-oil.de/annual_report08.html
Press photos: www.fuchs-oil.de/pressphotos.html
Important note
This press release contains statements about future developments that are based on assumptions and estimates by the management of FUCHS PETROLUB AG. Even if the management is of the opinion that these assumptions and estimates are accurate, future actual developments and future actual results may differ significantly from these assumptions and estimates due to a variety of factors. These factors can include changes in the overall economic climate, changes to exchange rates and interest rates, and changes in the lubricants industry. FUCHS PETROLUB AG provides no guarantee that future developments and the results actually achieved in the future will agree with the assumptions and estimates set out in this press release and assumes no liability for such.