SMT Scharf AG publishes final figures for 2008
Foreign share of revenues up slightly again / EBIT margin up to 14.9 % from 14.6 % / Proposed dividend of € 0.85 per share
At the same time, foreign revenues fell by € 0.4 million year-on-year to € 37.5 million after having increased for the previous three successive years. This was in particular due to the fact that Russian customers postponed orders at the start of November that would originally have been shipped by the end of 2008.
On the profits side, the SMT Scharf Group booked EBIT of € 7.4 million (previous year: € 7.5 million), lifting the EBIT margin to 14.9 % from 14.6 %. This was supported, in particular, by progress in making production more flexible and international as well as the successful launch of new products. Owing to changes in the product mix, the cost of materials ratio fell to 48.1 % from 49.1 %. The ratio of personnel expenses was unchanged year-on-year. Other operating expenses increased, in particular as a result of charges from adverse changes in currency exchange rates. Net income fell to € 5.3 million from € 6.0 million. In the previous year, the reduction in deferred tax liabilities as a result of the reform of corporate taxation in Germany had a positive impact on earnings.
On December 31, 2008, SMT Scharf's order book totaled € 26.2 million, up 180 % year-onyear. Around 90 % of these orders stemmed from foreign countries. This increase was due to orders from mine operators, which comprise several machines that are to be shipped over a staggered period. This coincided with the unscheduled postponement of several orders from Russia.
The SMT Scharf Group continued to increase its international sales and service activities. It formed a subsidiary in Russia, allowing the company to offer its own services there in future.
As a result of its more intense sales efforts, it has, in turn, been able to acquire several new customers, including in China, South Africa and Ukraine.
"Despite some setbacks, 2008 was another year of successful international growth for SMT Scharf, and we are proud that our corporate strategy has once again earned its laurels," commented Dr. Friedrich Trautwein, SMT Scharf AG's CEO. Management believes that it will be able to further increase revenues and earnings on average over the coming years. Russia, Poland, China and South Africa will continue to be key markets in this regard.
The Managing and Supervisory Boards will make a proposal to the General Meeting for fiscal year 2008 to distribute a dividend of € 0.70 per share and a bonus dividend of € 0.15, or a total of € 0.85 per share. This corresponds to a 68 % distribution rate. In terms of the closing price of SMT Scharf's shares on March 6, 2009, the dividend return is 10.0 %.
The full annual financial report for 2008 can be downloaded from the investor relations section of www.smtscharf.com.
About SMT Scharf AG
The SMT Scharf Group develops, builds and maintains rail-bound railway systems for mining and use in tunnels. The trains are used all over the world, primarily in hard coal mines, gold mines and in underground mining for platinum, diamonds, copper and nickel. They are used to transport material and personnel with working loads of up to 35t. Rail-bound trains are the only means of transport that can be used underground on branching lines to cope with inclines of more than 13 degrees. The SMT Scharf Group has subsidiaries in Germany, Poland, South Africa, China and Russia, as well as agencies around the world. The railways developed by SMT Scharf are characterized, above all, by high-performance engines, high working loads, high speed and low operating and maintenance costs. SMT Scharf records more than 70% of its revenues over the course of the year on high-growth foreign markets, such as Russia, China and South Africa. The replacement parts and repairs business constitutes around 50% of revenues. The advances in exploitation of resources make underground conditions increasingly difficult which in turn requires more high technology transport solutions in mining. The total market for underground transport technology comprises around € 5 billion to € 7 billion per year according to company estimates. SMT Scharf AG has been listed in the Prime Standard (regulated market) of the Frankfurt Stock Exchange since April 11, 2007.