SURTECO continues success abroad

SURTECO AG, leading international supplier to the construction and furniture industry, continued to consolidate its strong position during the first half of 2006, particularly in foreign markets. The proportion of exports also increased by one percentage point to 64 percent as a result. Foreign business was up by 5 percent on the comparable year-earlier period with sales amounting to 131.2 euros after the first six months of the year, confirming the good performance in the past. The Group has a workforce numbering more than 2,000 and following years of declining sales in domestic markets the surface specialist also succeeded in posting growth again at home – albeit modest growth. Domestic sales rose by one percent at 30 June and contributed 74.5 million euros to total sales of 205.7 million euros at SURTECO AG.

The Strategic Business Unit Plastics is the main sales engine at SURTECO AG. The Group focuses on plastic edging tapes and tech-nical extrusions worldwide. During the first half year, sales in these products amounted to 117 million euros, not least due to a strong first quarter, 5 percent above the equivalent period for 2005. SURTECO continued its success abroad in this sector and the recent takeover of Consolidated Edgings in Sydney means that the Group is now particularly well positioned in Australia. After sales “down under” during the first half of the year increased by 23 percent, Australia is already contributing 7.3 percent to total sales of the SBU Plastics.

The markets of the Strategic Business Unit Paper demonstrated a slight recovery at the beginning of the year, with SURTECO AG being significantly dependent not least on developments in the furniture market with its range of flat foils. This segment achieved sales amounting to 88.7 million euros (87.4) during the first half of this year, with 31.7 million euros attributable to the German market – representing a rise of 3 percent. It remains to be seen whether this performance can be maintained during the second half of the year. An additional factor was competitors in the segment of pre-impregnated foils and thin foils pursuing a more aggressive price policy based on volume.

In parallel with growth in sales, SURTECO AG also increased its op-erating result (EBITDA) by 2 percent to 36.2 million euros on 30 June. EBIT for the first half year also went up by the same percentage to 27.2 million euros. In 2005, SURTECO finished the year with a 4 percent increase in sales to 396.4 million euros and consolidated net income of 21.8 million euros (+ 20 percent). The Group is also basing its projection for the year 2006 on these key indicators. Assuming that the framework conditions do not deteriorate during the second half of the year and there are no major upsets in the foreign-exchange and commodity markets, organic growth should continue and above-average earnings performance should be achievable.