2004-11-08



8 November 2004

Trading update third quarter 2004 - Bekaert expects double-digit growth for 2004

Bekaert sustained its strong organic sales growth in the third quarter across all business segments and regions. The company has made further major efforts to manage continuing volatility in the raw materials markets, which has nevertheless inevitably translated into higher sales prices.
In the first nine months of 2004, Bekaert achieved an increase in consolidated and combined sales of 19% and 17% respectively.
[1] [2]

The consolidated sales' increase was 20% from organic growth and 3% from the net movement in acquisitions and divestments, while adverse currency movements amounted to 4%.

First nine months 2004

Consolidated sales

Combined sales

 

in millions of €

variance

in millions of €

variance

Advanced wire products

1 137

+23.5%

1 802

+20.8%

Fencing systems Europe

353

+13.9%

398

+9.1%

Advanced materials

86

+11.3%

86

+11.3%

Advanced coatings

97

+15.8%

97

+9.6%

Intersegment sales and others

-38

-

-42

-

Total

1 635

+18.7%

2 341

+16.6%

 

Combined sales by geographical area 

First nine months 2004

Combined sales

 

in millions of €

variance

Europe

1 006

+14.5%

North America

477

+12.0%

Latin America

638

+25.5%

Asia

179

+10.5%

Rest of the world

41

+22.4%

Total

2 341

+16.6%


 

In a generally favourable economic environment, Bekaert performed well for most of its products in Western Europe and North America. In addition, the company performed well in the growth markets in Latin America and Central Europe.  In China, strict government regulations have resulted in temporary slow-down in the market growth for (steel cord reinforced) radial tyres.  With its investment programme, Bekaert, however, is convinced that the Chinese Government’s long-term objectives, which are to bring the logistical costs of the infrastructure down to the same level as those in Europe and North America, will lead to an important increase in the pace of radialisation, i.e. the rate at which consumers switch from using diagonal tyres to radial tyres.

Advanced wire products

Combined sales of this whole business segment increased by 19%.  Sales in wire Europe and wire North America both increased by 22%. The markets for wire Latin America and wire Asia performed well and sales increased by 26% and 65% respectively.  Sales for building products rose by 37%. Sales of steel cord China decreased by 4%, while sales of the activity platform ‘steel cord others’ increased by 20%.

Consolidated sales of advanced wire products improved with the acquisition of Bekaert Hlohovec, a.s. (Slovak Republic) and of the remaining shareholding of Contours Ltd (U.S.).

Fencing systems Europe

Combined sales of fencing systems Europe rose by 10%.  Sales of Bekaert Fencing NV increased by 14%, while sales of the Handling activity decreased by 20%.

Advanced materials

Combined sales of advanced materials increased by 11%. In fibre technologies, sales rose by 11%. Combustion technologies achieved an increase of 44%, amongst others due to the acquisition of Solaronics Technologies. Composites experienced a sales’ decrease of 26%, mainly due to the exit from composite profiles. 

Advanced coatings

Combined sales for advanced coatings rose by 10%. In industrial coatings, sales went up by 16%.  Sales of specialised films increased by 5%.  Consolidated sales also rose as a result of the increased stake in Sorevi S.A. (France) and in Precision Surface Technology Pte Ltd (Singapore). 

Outlook

Bekaert expects a double-digit growth in 2004. 

Financial calendar

Analyst day                                                                            17    December   2004

Fourth quarter trading update and provisional 2004 results           21    February     2005

2004 results                                                                            17    March        2005

2004 annual report available on internet                                      22    April          2005

First quarter trading update                                                       11    May           2005

General Meeting of Shareholders                                               11    May           2005

Dividend payable (coupon nr. 6)                                                 18    May           2005

2005 interim results                                                                    1    August       2005

Third quarter trading update                                                       14    November   2005

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