MAIN FACTORS AFFECTING RESULTS

Consolidated profit in 1995 was BEF 3 181 million, an increase of 10.2 % over the 1994 figure of BEF 2 886 million, which excludes the BEF 3 700 million capital gain on the sale of shares in Bridgestone-Metalpha Corporation (Japan).

In the first six months of 1995, economic growth in most markets resulted in increased demand and capacity usage in Wire, Steel Cord and New Activities. In the second half of the year however, markets in Europe and North America slowed down, adversely affecting activity particularly in the Wire business.

The results from joint ventures in Latin America increased substantially, due to improved and more stable economic conditions in those countries, which resulted in higher activity in all subsidiaries, except in Mexico.

The effect of improved activity together with increased selling prices in the Wire business was not fully reflected in higher sales and profitability, because of the strength of the Belgian franc compared to the US dollar and to weaker European currencies. If exchange rates in 1995 had remained at 1994 levels, consolidated sales and operating profit would have been higher than reported by BEF 3 900 million and BEF 1 050 million respectively.

Acquisition of Rösler Draht AG and subsidiaries (Rösler)

The Group acquired 99.79 % of the shares of Rösler (Germany) on June 30, 1995.
Rösler is a significant manufacturer of merchant products for the European market and has been consolidated into the group's results from July 1, 1995.
The acquisition resulted in goodwill of BEF 490 million, which included the effect of restating the equity of the company in line with Bekaert accounting principles and establishing a provision for restructuring and integration of Rösler.
Sales for the six months to December 1995 were BEF 991 million. The impact on the Group's result was a net loss of BEF 185 million.
Benefits from the current restructuring and integration programme are expected to flow through into results in the latter part of 1996.