Frankenthal, Germany, September 22, 2005-- In the first half-year 2005, Tarkett AG reported EBITA (adjusted net earnings) of €42.6 million ($52.1 M), a decrease of 20.4% compared to the €53.5 million ($65.4 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 margin for selling price increases against the background of a fierce competition especially in the residential area.
Tarkett’s net profit for the 1st half-year 2005 amounts to €25.7 million ($31.4 M), slightly below the €26.5 million ($32.4 M) achieved in the 1st half-year 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 €33 million ($40.3 M).
In the first half-year the company reported sales amounting to €764.4 million ($934.2 M) as compared to €708.7 million ($866.1 M) in the reference period 2004. This corresponds to an increase of 7.9% at current exchange rates and 4% 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 parentheses) was as follows: Resilient Floorings grew slightly by 0.9 % (+7.2%), with a plus of 3.7% (3%) in the residential and a minus of 1.3% (+10.7%) in the commercial sector, including linoleum.
Sales in the hardwood segment increased by 1.3% (-0.5%), while laminate was once again able to continue its growth with a strong plus of 50.3% (50.3%).
Sales by region and market at constant exchange rates and comparable structure (figures at current exchange rates in parentheses) developed as follows: West Europe recorded a slight plus of 1.8% (+ 8.2%). The markets in detail: France decreased by 5.6% (- 6.1%) and the UK/Ireland region showed a minus of 6.8% (+45%). In contrast to this, South Europe, including the Benelux countries, grew by 11.4% (+7.7%); the German market, including Switzerland and Austria, reported a plus of 4.4% (+ 7.5%), whereas North Europe recorded an increase of 8.9% (+ 9.9%). Once again, sales in East Europe, including Russia, showed a double-digit growth of 17.9% (19.1%), benefiting from the sales contribution from the joint venture with Sintelon. North America grew slightly by 2.8% (1.7%).
In the context of petrol remaining close to the all time highs of this summer, Tarkett expects a scenario of persistently high raw material prices on one hand and a generally more precautious economic climate. The sales estimation follows the trends of the first half-year with results, on a full year basis, below expectations. Therefore Tarkett emphasizes the focus on product innovation, growth markets and productivity.
