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Please find below all Forbo media releases listed by year.
Eglisau, November 7, 2000
The Forbo Group increased net sales by 4.7 percent to CHF 1,365.0 million in the first nine months of 2000 compared with the same period of the previous year (1999: CHF 1,303.9 million). Adjusted by the profile business sold at the end of August, the increase is 5.4 percent. The operating profit after depreciation is 5.0 percent above previous year. As a consequence of the better operating and financial results, the group profit rose by 7.1 percent to CHF 66.5 million. Forbo is on course although raw material prices rose and some currencies and individual markets did not develop as expected. The company is confident about the future based on the good operating results and progress with the implementation of its program to focus its activities on four strategic core businesses.
"The shape of the four strategic businesses are getting ever more evident. We have made good progress with the implementation of our corporate strategy", said Werner Kummer, CEO. Important decisions were taken in the field of non-strategic businesses. In the meantime the profile business has been sold; restructuring of the carpets business has been concluded with the closure of the Wermelskirchen plant in Germany. The decorative films business is about to be sold, and a solution is being expected for another non-strategic business before the year-end. Restructuring and divestments will use a considerable part of the provisions of CHF 70 million made last year. At the same time Forbo is continuously evaluating potential acquisitions that are of a strategic fit and that will strengthen the group's future profitability.
On course in spite of a more difficult third quarter
The results recorded in the first three quarters of 2000 showed a positive trend. An even better result was prevented due to rising raw material prices and the development of foreign currencies. Especially in the third quarter, the markets in Switzerland, Germany and Scandinavia were weaker than expected. With a positive outcome of the fourth quarter, a profit rise to more than CHF 90 million can be anticipated. In addition, the return on assets employed is making progress, rising from 8.1 to 8.7 percent.
All in all the balance sheet could be reduced by CHF 80 million to CHF 1,647 million compared with 1999 as a result of debt reduction. For the total year, Forbo is expecting investments in fixed assets of less than CHF 90 million compared with CHF 125 million in the previous year. According to Gerold Zenger, CFO, the free cash flow will again improve essentially compared with the previous year.
Growth in the USA and in Asia - partial decline in Europe
Sales of linoleum rose by 3.6 percent to CHF 310.6 million. Especially the business in the USA and in Asia had an excellent development with a sales boost of 27 percent. Sales of vinyls rose by 2.7 percent to CHF 264.4 million. The market conditions remained difficult. A decline had to be recorded in nearly all European markets, which could partly be compensated for by exports (USA, Asia, Eastern Europe). Adhesives sales were stagnant due to fiercer competition in key markets for both floor coverings and industrial applications.
Positive development with belting
The business development with conveyor and drive belts made from synthetic material proved to be particularly dynamic. Sales rose by 17.5 percent to CHF 286 million, 4 percent of which are related to exchange rate movements. Growth rates of about 10 percent were recorded already in the previous years. However, profits could not keep up with sales. Significant changes such as the organizational and management streamlining and the creation of the three continental centers - Europe, America, and Asia - and market coverage by clearly defined segments are already showing first positive effects. In addition to growth, also profitability improved considerably. A further expansion on a higher level of profitability is expected for the coming year.
Confident about the future
Based on the business development so far and the progress made with the strategic realignment, the company is expecting clear result improvements for both the current and the coming business year.