2006-11-10



10 November 2006 

Third quarter trading update 2006 - Bekaert confirms 4% sales growth

 

In the first nine months of 2006 Bekaert achieved consolidated sales of € 1 505 million and combined sales of € 2 398 million, an increase of 4% and 5% respectively. [1] [2] [3]

After a record growth in 2004 and 2005 Bekaert again recorded an increase in consolidated sales in the first nine months of 2006. 3% was from the net movement in acquisitions and divestments and 1% from the impact of currency movements.

Consolidated and combined sales by business segment

First nine months 2006

Consolidated sales

 

Combined sales

 

in millions of €

variance

 

in millions of €

variance

Advanced wire products

1 290

+4%

 

2 162

+6%

Advanced materials

113

+15%

 

113

+15%

Advanced coatings

105

+5%

 

105

+5%

Intersegment sales and others

–3

 

18

Total

1 505

+4%

 

2 398

+5%

 

Combined sales by activity platform

Advanced wire products:

+6%

 

Advanced materials

+15%

Wire Europe

+5%

 

Fiber technologies

+18%

Wire North America

–3%

 

Combustion technologies

+10%

Wire Latin America

+12%

 

Composites

+19%

Wire Asia

+5%

 

 

 

Building products

+4%

 

Advanced coatings

+5%

Steel cord China

+43%

 

Industrial coatings

–2%

Steel cord others

–5%

 

Specialized films

+10%

Other advanced wire products

+15%

 

 

 

 

Combined sales of advanced wire products in the first nine months of 2006 were 6% higher.

Sales benefited from a positive impact of currency movements, most notably in Brazil and Chile.

In Europe, Bekaert was faced with increased competition and pressure on prices. The company recorded weak demand for steel cord products for tire reinforcement. Bekaert strengthened its position with the acquisition of Cold Drawn Products Ltd., which supplies specialized profile wires.

In North America, Bekaert noted a distinct weakening of the most important industry sectors in which the company is active. The wire plant in Muskegon (Michigan) was closed and the activities acquired from Conflandey Inc. were transferred to Shelbyville (Kentucky). Bekaert acquired Delta Wire in Clarksdale (Mississippi), a major supplier of bead wire for tire reinforcement.

Bekaert expanded its position in the strongly growing Chinese steel cord market. The company recorded sales growth of 43%, supported by a substantial investment program.

Sales of other advanced wire products were also higher, partly based on the acquisition of ECC Card Clothing in 2005.

Sales of advanced materials in the first nine months of 2006 were up 15%. In addition to the organic growth, the activities in fiber technologies were strengthened by the acquisition of Southwest Screens & Filters SA in June 2005. Growth in combustion technologies was supported by the recent acquisition of Aluheat, which specializes in environment-friendly technologies used in condensing boilers for heating systems. Sales in composites were also significantly higher, despite the extremely competitive environment.

Sales of advanced coatings in the first nine months of 2006 were 5% higher.

In industrial coatings, activities picked up in the third quarter after a difficult first half. Bekaert achieved strong organic sales growth in specialized films.

 

Combined sales by geographical area

First nine months 2006

Combined sales

 

in millions of €

variance

Europe

749

-2%

North America

508

+1%

Latin America

836

+9%

Asia

268

+24%

Other regions

37

+5%

Total

2 398

+5%

 

Outlook

Despite continued weakening on its European and North American markets, Bekaert confirms sales growth for 2006.

 

Financial calendar

Fourth quarter trading update 2006                                                       16    February      2007

2006 results                                                                                              16    March           2007

2006 annual report available on internet                                               24    April              2007

First quarter trading update 2007                                                            9    May               2007

General Meeting of Shareholders                                                            9    May               2007

Dividend payable (coupon nr. 8)                                                            16    May               2007

2007 half year results                                                                               31   July                2007

Third quarter trading update 2007                                                            9   November     2007

 


 

[1]  The figures in this press release are unaudited.

[2] Combined sales are sales generated by consolidated companies, joint ventures and associates.

[4]  Excluding ‘intersegment sales and others’.

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