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Thursday 30 April, 2009

Takkt AG

TAKKT Group hit by pronounced buying resistance...





Comprehensive adjustment measures initiated

Stuttgart, Germany, 30 April 2009. The TAKKT Group very much felt the
effects of the global economic crisis in the first quarter of 2009.
Adjusted for currency effects, its turnover fell by 25.3 percent,
which is the sharpest drop in turnover in the TAKKT history. The
Group initiated comprehensive measures to adjust its capacities and
cost structures accordingly, but these were not enough to prevent a
decline in its operating profitability.

Highlights in 2009

  * Currency-adjusted decline in turnover of 25.3 percent
  * EBITDA margin falls to 14.4 (17.9) percent
  * Share buy-back optimises balance sheet structure
  * Acquisition of the leading US mail order group for restaurant
    equipment

In the first quarter of 2009, TAKKT Group achieved turnover  of EUR
186.4 million (Q1 2008: 240.5). This amounts to a year-on-year
decline of 22.5 percent. Adjusted for currency effects, consolidated
turnover fell by 25.3 percent. "The severity and the extent of the
economic downturn we have seen in the past few months is unparalleled
in the history of the TAKKT Group," said CEO Georg Gayer of the
developments. "And this time, we have been unable to benefit from our
international diversification as it has coincided with a world-wide
economic slump. The Group is nevertheless achieving some good results
in spite of the current poor development in turnover due to our
flexible business model. Therefore our plans for expansion in 2009
are still secure."

Thanks to the TAKKT business model, the considerable decline in
turnover did not have a negative impact on the gross profit margin,
which - against the trend - has actually improved to 42.9 (41.2)
percent. On the one hand, this was due to the absence of larger
orders which regularly generate lower gross profit margins and a
higher share of stock shipments. On the other hand, the decline in
commodity prices has enabled TAKKT to negotiate better purchasing
conditions. "However, the positive development of the gross profit
margin was more than offset by the reduced capacity utilisation of
the mail order infrastructures and by the decrease in advertising
efficiency in all three divisions, typical in phases of economic
contraction," said CFO Dr Florian Funck, explaining the development
in earnings. "In all, we recorded a drop in our profit margins, in
spite of quickly implemented measures to adjust our capacities and
costs."

EBITDA (earnings before interest, tax, depreciation and amortisation)
was down by 37.6 percent to EUR 26.9 (43.1) million, while the EBITDA
margin fell from 17.9 to 14.4 percent. As a result of an amendment to
the IFRS accounting standards the way in which advertising expense is
recorded over time has changed as of 1 January 2009. Last year's
figures have been amended in accordance with the new accounting
policy in order to ensure the comparability of results. For details,
please see the Q1 report and the shareholder information 01/2009 on
the website www.takkt.com.

KAISER  + KRAFT EUROPA records substantial reductions
KAISER + KRAFT EUROPA, which was by far the most dynamic growth
driver within the TAKKT Group in the last three years, was the
division to be hit hardest by the economic crisis. Europe's economies
are suffering not only from the weak domestic demand, but also from
the severe drop in exports. In total, the division recorded a 27.1
percent decline in turnover to EUR 103.9 (142.5) million in the first
quarter of 2009, which can primarily be attributed to lower number of
orders. EBITDA fell to EUR 20.2 (33.7) million, which represents an
EBITDA margin of 19.4 (23.6) percent.

Topdeq suffers from continuing buying reluctance
Topdeq, which specialises in design-oriented office equipment, posted
a decline in turnover of 26.5 percent down to EUR 16.4 (22.3) million
in the reporting period, thus extending the weak development already
seen in 2008. Adjusted for the currency effects of the Swiss franc
and the US dollar, the organic drop in turnover was more pronounced
at 28.3 percent. Topdeq also had to assimilate downturns in operating
profitability. EBITDA fell to EUR 0.3 (1.5) million, and the EBITDA
margin was reduced to 1.8 (6.7) percent.

K + K America fares relatively well
With a 23.8 percent decline in turnover to USD 86.3 (113.3) million,
K + K America was the TAKKT division to fare best in the extremely
difficult economic environment. Translated into the reporting
currency of euro, the decline in turnover was not quite so severe, at
12.4 percent down to EUR 66.3 (75.7) million, thanks to the strong US
dollar. The companies in the Plant Equipment Group (C&H and Avenue),
which mainly serve industrial customers, were hit hardest. The
Specialties Group (comprising the Hubert companies) and the Office
Equipment Group (NBF Group), primarily selling their products to
customers in the more robust service sector, fared slightly better.
EBITDA fell to EUR 8.4 (10.0) million. The EBITDA margin declined
only slightly to 12.7 (13.2) percent, because here the implemented
measures showed the fastest results.

Management keeps to expansion plans despite economic crisis
KAISER + KRAFT EUROPA is pressing ahead with its plans to expand into
another Eastern European country and to intensify its e-business
activities in 2009, in spite of the current economic environment. Due
to the very positive response on the start of Hubert in Germany, K +
K America is already planning to expand with Hubert into another
European country in 2009. The preparations for this are currently
going according to plan.

"With its strong cash flow, solid balance sheet structure and
long-term credit lines, the TAKKT Group has the ways and means to
continue with its strategy of expansion, even through a difficult
economic cycle," Gayer stated. "We have enough flexibility to be able
to exploit interesting opportunities whenever they arise - as was the
case with Central Restaurant Products, which we acquired on 3 April
2009." This US market leader in the mail order sector for restaurant
equipment generates annual turnover of around USD 70 million with
approximately 75,000 customers, and also achieves high margins and
cash flows. "Not only does this company strengthen our presence in
the comparatively more stable North American service sector - this
acquisition also presents us with potential synergies in the areas of
purchasing, transport and advertising," Gayer continued.

Outlook for 2009 - significant drop in turnover anticipated
Based on the muted development in demand in the first quarter and the
continuing dismal economic outlook, the Management Board of TAKKT AG
is reckoning with an organic decline in consolidated turnover of
around 15 to 25 percent for the year as a whole. A good level of
profitability is nevertheless anticipated, thanks to the business
model with few fixed costs. "We are capitalising on every opportunity
we have to adjust our capacities to demand. The advertising costs
will likewise be brought into line with their lower efficiency. Even
if turnover declines by up to 20 percent in the year as a whole, we
will nevertheless still have a double-digit EBITDA margin," Funck
commented.

Change of leadership - Dr Zimmermann to become CEO
Georg Gayer steps down as CEO of TAKKT AG with effect from 31 May
2009, due to personal reasons. On 20 March 2009 the Supervisory Board
has appointed Dr Felix A. Zimmermann as Gayer's successor as of 1
June 2009. Zimmermann, who has been the Deputy Chairman responsible
for the K + K America division since 1 May 2008, has many years of
experience in the TAKKT Group, having acted as the CFO of TAKKT AG
between March 1999 and May 2004.

Special dividend proposed once again
TAKKT wants to share the good result of the 2008 financial year with
its shareholders. The Management and Supervisory Boards of TAKKT AG
therefore intend to propose an unchanged regular dividend of 32 cents
per share and, once again, a special dividend of 48 cents per share
at the Annual General Meeting.

Conference call
We invite you to directly address the Management Board with your
questions. We will be hosting a conference call for this purpose at
15:00 (CET) on 30 April 2009, during which we will be open to
questions. To take part, please dial the following number: +49 711
9659-9628 (access code: 779134#).

Short profile of TAKKT AG
TAKKT is the leading B2B mail order company for office, business and
warehouse 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 over 160,000 items from the
areas business and warehouse equipment, classical and design-oriented
office furniture and accessories, as well as sales promotion items
for retailers, the food service industry and the hotel market.

The TAKKT Group employs some 2,000 staff, has 3 million customers
worldwide and distributes more than 60 million catalogues and
mailings per year.

TAKKT AG is listed on the SDAX and was admitted to Deutsche Boerse's
Prime Standard on 1 January 2003.


Contact:
Georg Gayer, CEO         Tel. +49 711 34658-201
Dr Florian Funck, CFO    Tel. +49 711 34658-207

Email: [email protected]




IFRS figures of the TAKKT Group at the end of Q1 2009
(in EUR million)



                         Q1 2009     Q1 2008     Change in %
Turnover TAKKT Group       186.4       240.5           -22.5
   Organic growth                                      -25.3
   KAISER + KRAFT          103.9       142.5           -27.1
   EUROPA
   Topdeq                   16.4        22.3           -26.5
   K + K America (ยค)        66.3        75.7           -12.4
   K + K America ($)        86.3       113.3           -23.8
EBITDA                      26.9        43.1           -37.6
EBITDA margin               14.4        17.9
EBIT                        22.8        39.5           -42.3
EBIT margin                 12.2        16.4
Profit before tax           21.4        37.7           -43.2
Pbt margin                  11.5        15.7
Cash flow                   19.7        30.5           -35.4
Cash flow margin            10.6        12.7


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