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Thursday 24 March, 2011

Takkt AG

Business in Germany and online trading drive gr...

Takkt AG /
Business in Germany and online trading drive growth at TAKKT
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Operating profitability jumps to over 12 percent

Stuttgart, Germany, 24 March 2011.

One year after the most severe economic crisis in the post-war period, TAKKT
Group has returned to dynamic growth. Turnover and earnings both climbed
strongly. "Altogether we are very satisfied with the year 2010," stated CEO Dr
Felix A. Zimmermann at today's financial statements press conference in
Stuttgart. "Our GROWTH initiatives secured that our business expanded rapidly
last year, supported by the economic recovery." TAKKT is expecting positive
turnover and earnings performance to continue in 2011.

Significant events in 2010
  * Turnover up by nearly 10 percent to EUR 801.6 million

  * Further improvement in gross profit margin

  * EBITDA margin back in target corridor at 12.6 percent

  * Online portion up to 19 percent of total turnover

  * Repositioning of the Topdeq brand underway; goodwill corrected

  * Ordinary dividend for 2010 to remain stable at EUR 0.32 per share

In the 2010 financial year, TAKKT Group generated turnover of EUR 801.6 (2009:
731.5) million. This corresponds to a year-on-year increase of 9.6 percent.
Adjusted for currency effects and the turnover at Central Restaurant Products
(Central), which was acquired in 2009, growth came to 4.8 percent. "Over the
course of the year 2010 our turnover and earnings growth gained strong momentum.
In the final quarter TAKKT's organic turnover growth came to an impressive 9.4
percent," said CFO Dr Florian Funck.

Positive structural effects meant that in contrast to the normal pattern the
gross margin rose in line with the economic trend to reach 42.9 (42.0) percent.
EBITDA (earnings before interest, tax, depreciation and amortisation) rose
stronger than turnover, soaring by 46.5 percent to EUR 100.6 (68.7) million. The
EBITDA margin, which is an important key figure for TAKKT Group, rose to 12.6
(9.4) percent, which is back within the long-term target corridor of twelve to
15 percent. "A key driver of this EBITDA rise was the strong turnover and the
related economies of scale. The FOCUS restructuring programme that we carried
out in 2009 also contributed a good EUR nine million of additional earnings,"
added Funck.

Below the level of EBITDA, earnings were reduced by the impairment loss of EUR
12.9 million recognised on the goodwill for the Office Equipment Group (OEG) in
Europe. However, this did not affect the Group's cash flow. Finance expenses
rose to EUR 9.1 (7.2) million. This was due partly to the stronger US dollar and
a higher quota of long-term interest-rate hedging.

As the impairment of goodwill is not deductible for tax purposes, the tax ratio
went up to 41.4 (34.3) percent. Adjusted for this effect, the tax ratio fell
slightly year on year to 34.0 percent. As a result of these factors, the
increase of 24.5 percent from EUR 27.8 million to EUR 34.6 million in the profit
for the period was behind the improvement in operating earnings.

Strong cash flow - good balance sheet ratios
TAKKT's cash flow - defined as profit for the period plus depreciation, goodwill
impairment  and deferred  tax affecting  profit  -  rose by  25.2 percent to EUR
70.3 (56.1)  million. This  confirms once  again the  strength of  TAKKT Group's
business  model. The cash  flow margin as  a percentage of consolidated turnover
came  to 8.8 (7.7) percent. After  including the cash effects  of changes in net
working  capital and regular  capital expenditure, this  resulted in a free cash
flow  of EUR 81.6 (66.4)  million for acquisitions,  repayment of borrowings and
 payments  to shareholders. With an equity ratio of 46.5 (45.1) percent, TAKKT's
balance  sheet  structure  is  still  comfortably  in  the  middle of its target
corridor of 30 to 60 percent.

GROWTH initiatives take effect
TAKKT  Group  benefited  from  the  global  economic  recovery in the year under
review.  The domestic German market stood out particularly. However, the Group's
growth  was  not  based  solely  on  the better economic environment. The growth
initiatives  launched  in  2009 made  a  substantial contribution to the upturn.
TAKKT  has continued to refine its business model, especially in the field of e-
commerce,  partly via  web shops  as a  complement to  the traditional catalogue
brands,  partly also via web-only brands  targeting new B2B customer groups. The
European  internet brand Certeo, for example, rolled out its web shop to Austria
and  Switzerland in  2010. Another pure  internet brand,,
was  also launched on the US market in 2010. In addition the Topdeq and National
Business  Furniture brands launched web shops  in Spain and Canada respectively.
"Our  target is to have a pure online brand  in all groups by the end of 2011,"
said  Dr Zimmermann, laying out the next  goals for e-commerce. "Within just ten
years the proportion of turnover generated via the internet has risen from below
one  to over 19 percent. This is  a trend which is set  to continue in the years

TAKKT also pursued its expansion in 2010 in the traditional catalogue business.
KAISER + KRAFT started in Russia, gaerner is now also present in Italy and
Hubert moved into Switzerland, its third European market in three years.

Another important success factor was the wider range of private brands. These
currently account for around ten percent of consolidated turnover. TAKKT aims to
increase this figure to 20 percent in the medium term.

Divisions finish the year neck to neck
TAKKT EUROPE holds its ground as major earnings contributor
The  two  divisions  created  at  the  beginning of 2010, TAKKT EUROPE and TAKKT
AMERICA,  stayed  neck  to  neck  on  average  over the year in terms of organic
growth.  On a quarterly basis there were nevertheless some sectoral and regional

In the year under review, TAKKT EUROPE recorded turnover of EUR 467.1 (436.0)
million. The economic upturn and the GROWTH initiatives launched last year led
to positive business developments, especially in the second half of the year,
which prompted a 7.1 percent overall increase in turnover. The performance of
the two groups within the division nevertheless differed strongly over the year.
The Business Equipment Group (BEG), comprising the companies from the former
KAISER + KRAFT EUROPA division, closed the year with high single-digit growth,
but the Office Equipment Group (OEG) with the Topdeq companies reported a
double-digit fall, even adjusting for the terminated US operations. Overall,
TAKKT EUROPE generated 58.3 (59.6) percent of consolidated turnover.

EBITDA for TAKKT EUROPE rose stronger than revenue year on year, up 43.6 percent
to EUR 79.1 (55.1) million. The EBITDA margin of 16.9 (12.6) percent was above
the target range for the Group. Despite the steep fall in turnover, the OEG
still reported positive operating earnings above previous year's level.

TAKKT AMERICA up on the year in all three groups
TAKKT  AMERICA  generated  turnover  of  USD  442.8 (411.2) million in the 2010
financial  year.  This  corresponds  to  a year-on-year increase of 7.7 percent.
Adjusted  for  the  acquisition  of  Central,  turnover  grew by 5.4 percent. In
TAKKT's  reporting currency - the euro -  the division generated turnover of EUR
334.7 (295.6)   million.   The   Specialties  Group  (SPG)  posted  the  biggest
improvement  with a high single-digit rate of organic growth. Including Central,
growth  here ran well into double-digit figures. The Plant Equipment Group (PEG)
achieved  a good single-digit increase in turnover thanks to the continuing rise
in  order numbers.  Although the  companies in  the Office Equipment Group (OEG)
tend  towards late-cyclical  development, the  group recorded  a slight  rise in
turnover. Overall, TAKKT AMERICA contributed 41.7 (40.4) percent to consolidated

Earnings improved at all three groups. Overall, EBITDA came to EUR 28.9 (21.1)
million. The EBITDA margin for TAKKT AMERICA in the year under review came to
8.6 (7.1) percent. "This is a decent improvement, but we believe it is by far
not the end of the story . Our clear objective in the years ahead is to raise
the division's margin into double digits," said Funck, commenting on the

Stable ordinary dividend of EUR 0.32; strong share performance
On  the basis of the profit  for the year and the  good cash flow the Management
and  Supervisory Boards are  to propose to  the Annual General  Meeting on 4 May
2011 paying  an ordinary dividend  of EUR 0.32 per  share for the financial year
2010, as  in the previous year.  No special dividend is  planned. In relation to
the  average price  of the  TAKKT share  in 2010 this  corresponds to a dividend
yield  of 3.6 percent.  Shareholders also  benefited from  an increase  of 51.0
percent in the value of the TAKKT share in 2010.

Outlook for 2011: four percent increase in turnover expected
In  2011 TAKKT intends to launch more growth initiatives. These include two more
web-only platforms at the OEG in Europe and the SPG in the USA. The distribution
strategies  of  the  traditional  multi-channel  brands  are also to be refined.
"TAKKT  aligns  its  business  systematically  with  the  needs of the different
customer groups. Our multi-channel approach gives us an innovative, well-stocked
toolbox  for  doing  so,  with  catalogues,  web shops, integrated e-procurement
solutions  and personal service  provided by our  customer relationship managers
for key accounts," explained Dr Felix A. Zimmermann in his outlook. Beside these
initiatives particular attention will be paid to the repositioning of Topdeq.

After a good start into the new financial year the Management Board is
anticipating organic turnover growth of around four percent for 2011 and further
improvement in the operating margin.

IFRS figures for TAKKT Group for the 2010 financial year
(in EUR million)

|                                                      | 2010| 2009|Change in %|
|TAKKT Group                                           |801.6|731.5|        9.6|
|turnover                                              |     |     |           |
|                                                      |     |     |           |
|organic growth                                        |     |     |        4.8|
|                                                      |     |     |           |
|  TAKKT EUROPE                                        |467.1|436.0|        7.1|
|                                                      |     |     |           |
|  TAKKT AMERICA (€)                                   |334.7|295.6|       13.2|
|                                                      |     |     |           |
|  TAKKT AMERICA ($)                                   |442.8|411.2|        7.7|
|EBITDA                                                |100.6| 68.7|       46.4|
|                                                      |     |     |           |
|EBITDA margin                                         | 12.6|  9.4|           |
|EBITA                                                 | 80.8| 49.4|       63.6|
|                                                      |     |     |           |
|EBITA margin                                          | 10.1|  6.8|           |
|EBIT                                                  | 68.0| 49.4|       37.7|
|                                                      |     |     |           |
|EBIT margin                                           |  8.5|  6.8|           |
|Profit before tax                                     | 59.0| 42.4|       39.2|
|                                                      |     |     |           |
|Pre-tax profit margin                                 |  7.4|  5.8|           |
|TAKKT cash flow                                       | 70.3| 56.1|       25.3|
|                                                      |     |     |           |
|TAKKT cash flow margin                                |  8.8|  7.7|           |
|                                                      |     |     |           |
|Capital expenditure (incl. acquisitions and finance   |  6.7| 60.1|      -88.9|
|leases)                                               |     |     |           |
|TAKKT cash flow per share in EUR                      | 1.07| 0.84|       27.1|
|Earnings per share in EUR                             | 0.52| 0.41|       26.8|
|Dividend per share in EUR                             | 0.32| 0.32|        0.0|
|Non-current assets                                    |377.8|386.8|       -2.3|
|in % of total assets                                  | 69.8| 72.1|           |
|Total equity                                          |251.7|242.1|        4.0|
|in % of total assets                                  | 46.5| 45.1|           |
|Net borrowings                                        |139.2|180.8|      -23.0|
|Employees (full-time equivalents)                     |1,807|1,768|        2.2|
|at 31.12.                                             |     |     |           |

Company calendar
The figures for the first quarter of 2011 will be published on 28 April 2011.
The Annual General Meeting will be held at the Forum Ludwigsburg on 04 May 2011.

Short profile of TAKKT AG
TAKKT is the leading B2B direct marketing specialist for business equipment in
Europe and North America. The Group is represented with its brands in more than
25 countries. The product range of the TAKKT subsidiaries comprises some
160,000 items for the areas of business and warehouse equipment, classic and
design-oriented office furniture and accessories, and supplies for retailers,
the food service industry and the hotel market.

TAKKT Group employs some 1,800 staff, has three million customers worldwide and
distributes around 50 million catalogues and mailings per year.

TAKKT AG is listed on the SDAX and was admitted to Deutsche Boerse's Prime
Standard on 01 January 2003.

Dr Felix A. Zimmermann, CEO                   Tel. +49 711 3465-8201
Dr Florian Funck, CFO                                Tel. +49 711 3465-8207

Email: [email protected]

 --- End of Message --- 

Takkt AG
Presselstr. 12 Stuttgart 

Listed: Regulierter Markt in Frankfurter Wertpapierbörse;

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