BREMBO: The Board of Directors of Brembo approved financial results as of 30 June 2008: Financial News

BREMBO: The Board of Directors of Brembo approved financial results as of 30 June 2008
Friday August 29, 2008 10:52 am ET

STEZZANO, ITALY--(MARKET WIRE)--Aug 29, 2008 --
The Board of Directors of Brembo approved financial results as of 30 June 2008:

-- Sales +24.4% (+14 % like-for-like);

-- EBITDA +20.1%;

-- Net profit +14.3%

compared with the first half-year of 2007.

The orders visibility for the months to come seems to confirm a good sales performance of the Group also in the second half-year of 2008. The Group reached agreements with the main customers concerning raw material costs allowing to keep under control the impact on margins.

In summary:

 
+-------------------------+------+------+--------+
|(EUR  Million)           |H1 08 |H1 07 |% 08/07 |
+-------------------------+------+------+--------+
|Sales                    |567.9 |456.7 |+ 24.4% |
+-------------------------+------+------+--------+
|EBITDA                   | 80.6 | 67.1 | +20.1% |
+-------------------------+------+------+--------+
|EBIT                     | 51.7 | 45.1 | +14.6% |
+-------------------------+------+------+--------+
|Pre-tax profit           | 43.8 | 40.9 |  +7.1% |
+-------------------------+------+------+--------+
|Net profit               | 30.8 | 26.9 |+ 14.3% |
+-------------------------+------+------+--------+
|Net financial            |330.2 |232.9 |+ 41.8% |
|indebtedness             |      |      |        |
+-------------------------+------+------+--------+

Consolidated revenues for the first half-year 2008

H1 2008 consolidated revenues amount to EUR 567.9 million, up 24.4% over the same period of last year. EUR 47.3 million of these sales are related to the scope change due to the acquisitions realized in the recent quarters. Like for like, net sales growth would be +14%. The second quarter shows a significantly higher growth (+29.6%), above all thanks to organic growth (+17.6%).

Among all sectors, the commercial vehicles (+28.9%) and motorcycle (+24.4%) mainly contributed to sales growth in the period under analysis. The passenger car segment grew by 21.7%, thanks to the consolidation of the US company acquired in November 2007. Racing shows a slight decrease (-1.6%) attributable to the currency impact of US Dollar and GB Pound.

From a geographic point of view, growth has been driven by Japan (+97.5%) and by NAFTA area (+97.3%), the latter thanks to the new Harley Davidson platform and the recently acquired US company. Brazil keeps on growing (+47.7%). Turnover increased also Italy (+19.2%) and UK (+7.4%).

During H1 cost of sales and other operative costs amount to EUR 374.9 million, with an incidence of 66% on sales, compared to 67% of the same period of the previous year.

The improvement is due to a favourable sales mix of high value-added applications, allowing to compensate the raw materials and energy cost increase (EUR 4.2 million), mostly during the second quarter.

H1 2008 benefits from capital gains on the resale of some Italian buildings (EUR 1.7 million) and government grants on R&D expenses (EUR 1.1 million).

The personnel expenses amount to EUR 112.5 million, up 34.6% compared to EUR 83.5 million in the same period of the previous year, with an incidence on revenues that increases from 18.3% to 19.8%. The comparison between the terms under consideration is not homogenous: the first half-year of 2007 took advantage of a non-recurring reduction of the Employees' leaving entitlement (EUR 3.9 million) due to a law change in Italy and, in June 2008, the Group incurred one-off costs for the Managing Director's exit package.

Net of this effects, the labour cost increase during H1 2008 was 23.5%, in line with sales growth.

EBITDA amounts to EUR 80.6 million (14.2% of sales compared to 14.7% in H1 2007).

Depreciation and amortization in the period on approval amount to EUR 28.9 million, up 31.5% over the 2007 first half-year, due to the significant investments carried out by the Group.

EBIT amounts to EUR 51.7 million (9.1% of sales) compared to EUR 45.1 million (9.9% of sales) in the same period of the previous year.

Net financial charges, EUR 6.4 million, are composed by positive exchange rate differences for

EUR 1.1 million (EUR 0.6 million positive in 2007) and financial charges of EUR 7.5 million (EUR 5 million in 2007). The increase of financial charges is mainly due to the higher financial indebtedness and to the interest rate increase.

Estimated taxes for the period amount to EUR 13.5 million, in line with the previous year; tax rate is 30.7% compared with 33.1% of H1 2007. The tax rate decrease is due to the effects of Financial Law 2008 on Group Italian companies.

The half-year closes with a profit of EUR 30.8 million, 14.3% more than the first half-year of 2007.

The main investments in tangible and intangible assets of this half-year, EUR 35.8 million, are done in Italy, Polish companies and Brazil.

Net financial indebtedness rises up to EUR 330.2 million at 30 June 2008, compared to EUR 235.9 million at 31 December 2007, due to recent acquisitions, investment programs, net working capital growth related to the sales seasonality and to the dividends payment.

Significant events after 30 June 2008

On 29th August 2008 the Board of Directors approved the adoption of a lower tax rate allowed by the Finance Law 2008 applicable to deferred taxes on R&D costs. The tax amount is equal to EUR 1.5 million and the deferred taxes that will be released are about EUR 3.1 million.

Foreseeable evolution

The orders book for the months to come seems to confirm a good performance of the Group sales also in the second half-year of 2008, although with a growth rate lower than H1.

The raw materials and energy markets are still positioned around all time peaks, but the Group reached agreements with the main customers allowing to keep under control the impact on margins.

The significant investment programs will continue during the second half- year to increase the production capacity of the Group.

Here attached you will find the consolidated Balance Sheet- Income Statement and cash-flow statement, currently under examination by the Independent Audit Company.

The manager responsible for preparing the company's financial reports Corrado Orsi declares, pursuant to paragraph 2 of Article 154-bis of the Consolidated Law of Finance, that the accounting information contained in this press release corresponds to the document results, books and accounting records.

This information is provided by HUGIN