Tarkett AG Reports Earnings for First 9 Months

Frankenthal, Germany, November 16, 2005--In the first three quarters 2005, Tarkett AG achieved sales amounting to €1205 million ($1.4 billion) as compared to €1091,1 million ($1.3 billion) in the reference period 2004. This corresponds to an increase of 10.4% at current exchange rates and 4.7% at constant exchange rates and at comparable structure. The sales development by product segment--at constant exchange rates and comparable structure--(figures at current exchange rates in brackets) was as follows: Resilient Floorings grew by 1.2% (+8%), with a plus of 4.7% (4.4%) in the Residential and a minus of 1.9% (+11.2%) in the Commercial sector, including Linoleum. Sales in the Hardwood segment remained essentially on prior year’s level at 0.3% (-1%), while Laminate was once again able to continue its growth with a strong plus of 49.9% (50.4%). Sales by region and market at constant exchange rates and comparable structure (figures at current exchange rates in brackets) developed as follows: West Europe showed an improvement of 2.4% (+9.2%). The markets in detail: the downtrends of France of -4.2% (-4.8%) and the UK/Ireland of -7% (+48.9%) were overcompensated by South Europe, including the Benelux countries with a Plus of 9 % ( +13 %) and Scandinavia with a Plus of 11.2% (11. 5%) and to a lesser extent, Germany with Switzerland and Austria, reporting a plus of 1.3% (+4.8%). Once again, sales in East Europe, including Russia, showed a double-digit growth of 20% (20.9%), benefiting from the sales contribution from the joint venture with Sintelon. North America remained on prior year’s level with +0.1%, mainly due to the metereological events in the third quarter, but shows a plus of 5.4% at actual structures and exchange rates. The first three quarters’ EBITA for 2005 reached €76.7 million ($89.9 million) compared to the €80.3 million ($94.1 million) achieved in the comparable period 2004. This development is mainly attributable to the high raw material prices for resilient products as well as the limited possibilities to pass on necessary price adjustments against the background of a fierce competition especially in the Residential area. Tarkett’s net profit for the first nine months in 2005 amounts to €51.4 million, compared to the €39.5 million achieved in the first three quarters in 2004. In accordance with the new IFRS standards, the profit figure does not include any goodwill amortization. Based on the new standard, the net profit for 2004 would have amounted to €49.7 million. In the context of a scenario characterised by persistently high oil prices, we will be facing an additional price increase of our key raw materials in the last quarter of 2005. While sales should follow the trends of the first nine months, this will impact negatively the results of the corresponding period. In this context Tarkett continues to emphasize the focus on product innovation, growth markets and productivity.