Wesel, 18. März 2008

ALTANA AG reports excellent business year 2007

  • Dynamic growth in sales and earnings
  • Dividend proposal: €0.25 per share
  • Special dividend: €0.26 per share
  • Positive outlook for the business year 2008


In the past business year, the specialty chemicals group ALTANA (ALT) achieved dynamic sales growth and disproportionate increases in earnings. “Our business performance in the first year as a pure specialty chemicals company was excellent and we were able to surpass our own ambitious targets,“ stated Dr. Matthias L. Wolfgruber, CEO of ALTANA AG, at the company’s press conference. “We are very confident to be able to continue our dynamic and profitable growth in 2008.”

Strong growth in sales and earnings
In the past business year, ALTANA achieved sales of €1,380.4 million, which is an increase of about 7% on 2006. Adjusted for negative exchange rate effects of 3% as well as minor positive acquisition and divestment effects, operating sales growth was 9%. With a sales growth of 11% the Asian region posted the strongest growth, followed by Europe with a growth of 8%. About half of ALTANA’s sales, namely € 678.0 million, were generated in Europe. Sales in Asia amounted to €329.7 million, with €149.8 million attributable to China. At €330.6 million, sales in North and South America remained almost unchanged.

At €248.5 million, ALTANA’s earnings before interest, taxes, depreciation and amortization (EBITDA) rose disproportionately to sales. This corresponds to an increase of 33% or €62.3 million on the prior year. The EBITDA margin climbed from 14.4% to 18.0%, and was thus within the medium-term target corridor of 18% to 20% despite additional costs due to the two-tier holding structure which was maintained until mid-2007. All divisions were able to expand their EBITDA margins. The operating income (EBIT) totaled €166.6 million, and thus increased by 68% as compared to the business year 2006. Income before taxes (EBT) amounted to €214.3 million, up from €93.2 million in the prior year. The 2007 figure includes an income of €55 million from the investment of the proceeds related to the sale of ALTANA Pharma until the distribution to ALTANA’s shareholders in May 2007. Net income (EAT) of the continued operations amounted to €138.4 million, and therefore more than doubled compared to the prior year.

As of December 31, 2007, the ALTANA Group employed 4,646 people, compared to 4,484 in the prior year. Investments in property, plant and equipment as well as intangible assets totaled €91.4 million. Group-wide research and development expenses reached 4.9% of sales, whereas the industry average is about 2% to 3%. Approximately 16% of ALTANA’s staff worldwide are employed in the area of R&D.
 
Positive development in all divisions
The BYK Additives & Instruments division achieved sales of €445.1 million, up from €409.1 million in the prior year. This translates as an increase of 9%. Earnings before interest, taxes, depreciation and amortization (EBITDA) rose disproportionately to sales by 13%, up from €117.8 million to €132.6 million. The EBITDA margin was 29.8% (prior year: 28.8%).

ECKART Effect Pigments posted an increase of 7%, with sales rising from €338.8 million to €362.9 million. The EBITDA grew disproportionately by 19 % to €79.7 million (prior year: €67.2 million). The EBITDA margin was 22.0% compared to 19.8% in the prior year.

Sales of ELANTAS Electrical Insulation grew by 8% to €350.8 million (prior year: €325.7 million). The EBITDA grew disproportionately by 20% to €53.1 million. This resulted in an EBITDA margin of 15.1% compared to 13.6% in 2006.

Sales in the ACTEGA Coatings & Sealants division were up from €220.7 million to €221.6 million in the past business year. The increase in earnings was much more dynamic: The EBITDA climbed by 13%, rising from €23.5 million in 2006 to €26.7 million in 2007. The EBITDA margin rose accordingly from 10.7% to 12.0%.

Shareholders benefit from positive business development
ALTANA will enable its shareholders to participate appropriately in the company’s success. Based on the excellent business year 2007, the Supervisory and Management Boards will propose to the Annual General Meeting on May 5, 2008, to distribute a regular dividend of €0.25 per share for the past business year. This corresponds to a distribution rate of around 33% measured in terms of the EAT of the continued operations, adjusted for the income (net of tax) from the investment of the proceeds related to the sale of ALTANA Pharma (€35 million). This will be distributed to the shareholders as a special dividend in the amount of €0.26 per share. Provided the dividend proposal is approved, a total of € 69.4 million or €0.51 per share will be distributed.

Positive outlook for 2008
For the current business year, ALTANA expects continued positive demand for specialty chemicals products. However, the demand growth should be slower compared to 2007. Raw materials prices should remain at their current high level. On this basis, we expect from today’s perspective for 2008 a mid-range single-digit organic growth in sales to a level between €1.440 billion and €1.490 billion and an EBITDA growth to a level between € 260 million and € 290 million. These expectations are based on a presumed U.S. Dollar rate of 1.45 per Euro on an annual average.

The medium-range growth target is set at an average sales growth of about 10% annually (thereof about 6% organic growth) while maintaining an above-average profitability with an EBITDA margin of 18% to 20%.

ALTANA Group1

2007

2006

Change

 

 

 

in %

 

 

 

 

Sales – total (in € million)

1,380.4

1,294.3

7

 

 

 

 

Sales by division (in € million)

 

 

 

Additives & Instruments

445.1

409.1

9

Effect Pigments

362.9

338.8

7

Electrical Insulation

350.8

325.7

8

Coatings & Sealants

221.6

220.7

0

 

 

 

 

Sales by region (in € million)

 

 

 

Europe

678.0

627.4

8

    thereof Germany

239.6

223.2

7

North and South America

330.6

330.5

0

    thereof U.S.

222.5

242.6

- 8

Asia

329.7

297.3

11

    thereof China

149.8

127.5

18

Other regions

42.1

39.1

8

 

 

 

 

EBITDA (in € million)

248.5

186.2

33

EBIT (in € million)

166.6

99.4

68

EBT (in € million)

214.3

93.2

> 100

EAT (in € million)

138.4

56.8

> 100

 

 

 

 

Headcount (Dec. 31)

(fortzuführende Bereiche)


 

 

 

BYK Additives & Instruments

1,140

1,052

8

ECKART Effect Pigments

1,893

1,802

5

ELANTAS Electrical Insulation

887

883

0

ACTEGA Coatings & Sealants

670

655

2

Holding

56

92

- 39

ALTANA total

4,646

4,484

4

1) The figures relate to the continuing operations.


The Management Board will report in detail on ALTANA’s annual financial statements at the press conference today at 11 a.m. (local time, CET) and at the analyst meeting at 2 p.m. (local time, CET). The meetings will take place at the Düsseldorf Hilton Hotel. Both meetings will be webcasted at www.altana.com.

Date:

The Annual General Meeting of ALTANA AG will take place on May 5, 2008, at the Congress Center Messe Frankfurt.

This press release contains forward-looking statements, i.e. current estimates or expectations of future events or future results. These statements are based on beliefs of ALTANA as well as assumptions made by and information currently available to ALTANA. Forward-looking statements speak only as of the date they are made. ALTANA does not intend, and does not assume any obligation, to update forward-looking statements to reflect facts, circumstances or events that have occurred or changed after such statements have been made.

About ALTANA:
ALTANA develops and produces high-quality innovative products in the specialty chemicals business. The ALTANA Group, with headquarters in Wesel/Germany, is a genuine “global player” with 83% of its sales generated by international activities. The ALTANA Group has four divisions: BYK Additives & Instruments, ECKART Effect Pigments, ELANTAS Electrical Insulation, and ACTEGA Coatings & Sealants. All of these divisions occupy a leading position in their target markets with respect to quality, product solution expertise, innovation and service.

ALTANA offers innovative, environmentally compatible solutions with the matching specialty products for coating manufactures, paint and plastic processors, the printing and cosmetic industries, and the electrical and electronic industry. The product range includes additives, special coatings and adhesives, effect pigments, sealants and compounds, impregnating resins & varnishes, and testing and measuring instruments.

At present, the ALTANA Group has 32 production facilities and 46 service and research laboratories worldwide. Throughout the group about 4,600 people work to ensure the success of ALTANA worldwide. In 2007, ALTANA achieved sales of about 1.4 billion euros. Its impressive earning power and high growth rate make ALTANA one of the most successful and innovative chemical groups worldwide

.