Mühlbauer ends 2010 with record result - increase of dividend to EUR 1.30 planned

Roding, (PresseBox) - "2010 was an excellent year for Mühlbauer. Thanks to our technology and market expertise, the concentration of which is unique worldwide, we were able to convince further government organizations of our solution competency", commented Josef Mühlbauer, personally liable shareholder of Mühlbauer. "Sales and earnings hit historic highs, also due to the global economic recovery on the industrial markets. At the same time we further reinforced our market position on our core markets and progressively extended our solid base through massive investments. We are confident that we will further raise sales and earnings in 2011 - the year Mühlbauer celebrates its 30th anniversary."

Sales development. In the 2010 financial year, Mühlbauer raised sales significantly, to a new record high of EUR 207.5 million. This corresponds to growth of 29.1% against the value achieved for the same period of the previous year (PY: EUR 160.8 million). The realization of further, partly highvolume government projects and the positive development in the area of industrial card applications resulted in sales of EUR 126.9 million in the company's core business area Cards & TECURITY® and thus to a 12.5% year-on-year increase (PY: EUR 112.8 million). Semiconductor Related Products again proved to be the primary driver of the Group's sales development in 2010. As a result of the high demand for RFID Smart Label and semiconductor backend solutions, Mühlbauer achieved record sales of EUR 49.7 million (PY: EUR 29.5 million) in this area, corresponding to a sales increase of 68.8%. The economic recovery in 2010, also had a positive impact on the remaining two business areas. While sales in Traceability climbed 58.6%, to EUR 9.2 million (PY: EUR 5.8 million), Precision Parts & Systems achieved a record high with sales of EUR 21.7 million (PY: EUR 12.7 million), thus exceeding the same period of the previous year by 70.9%.

Earnings development. In 2010, the earnings situation benefited strongly from the positive business development. At EUR 38.2 million, EBIT did not only approximately exceed the previous year's value of EUR 9.6 million three-fold. It also recorded a new record high in the history of the Group. Gross profit, which rose strongly against sales, at EUR 28.3 million or 52.3%, contributed significantly to this extremely positive sales development. Also supported by a EUR 0.3 million yearon- year improvement in financial result, the Group recorded an EBT of EUR 38.6 million (PY: EUR 9.7 million), overall. This corresponds to a profit margin of 18.6%, after 6.0% in the previous year. Taking into consideration a slightly lower tax rate, consolidated net earnings rose by EUR 23.0 million, to EUR 30.3 million (PY: EUR 7.3 million). In relation to individual shares, earnings totaled EUR 2.09 (PY: EUR 0.50), thus having increased more than four-fold against the previous year.

Dividend suggestion. Mühlbauer is continuing its stable and continuity-oriented dividend policy of previous years. The personally liable shareholder and Supervisory Board therefore intend to propose to the Annual General Meeting the payment of a 30% higher dividend of EUR 1.30, after EUR 1.00 in the previous year.

Cashflow. In the year under review, cashflow from operating activities totaled EUR 47.9 million and was thus EUR 17.7 million higher year-on-year (PY: EUR 30.2 million). The main reason for this distinct increase was the record level of net earnings achieved during the reporting period. This positive development was also benefited by the decline of working capital, which dropped 23.2% against the previous year. At EUR 27.9 million, the outflow from investment activities was 77.7% higher than in the previous year (PY: EUR 15.7 million). This increase is primarily due to the increased investments in fixed assets, particularly in the company's technology centers in Malaysia, Slovakia and at its headquarters in Roding. Both the financial and the capital structure of the Mühlbauer Group form a solid basis for further business development with an adjusted free cashflow of EUR 25.9 million (PY: EUR 3.3 million), shareholders' equity of 73.5% (PY: 77.9%) and net liquidity of EUR 38.4 million (PY: EUR 25.8 million) to the end of 2010.

Order income. Based on a series of further government orders and the rise in demand in the industry business, which is also due to the economic recovery, order income rose to EUR 301.6 million during the reporting period. This not only corresponds to a massive increase of 93.6% against the order income of EUR 155.8 million, achieved in the same period of the previous year; moreover, with this value, Mühlbauer achieved the highest order income in the history of the company. This extremely dynamic development had an equally positive effect on order backlog, which was 125.5% higher, at EUR 159.9 million, than the previous year's value of EUR 70.9 million.

Outlook. In future, the possible applications in the industries and markets relevant to Mühlbauer will continue to gain in importance. The increasing mobility of people in connection with a rising need for security and a desire to rationalize their administrative systems will continue to be the main drivers of governments and public authorities in paving the way for innovative ID solutions such as biometric ID cards and ePassports. Furthermore, the number of applications in the area of contactless identification using RFID Smart Labels is rising progressively due to the distinct drop in costs for label production. As developer and manufacturer of the complete range of hardware and software systems in-house, customers benefit in a special way from the solution provider's technology and market expertise, which has grown over a period of thirty years. As a result, Mühlbauer considers itself strategically well positioned to benefit strongly from the potential available on these markets - thanks to its unique range of services. In the 2010 financial year the company consistently prepared for the future - through massive investments - and against this background it maintains its long-term growth strategy. In the current financial year, the Group is therefore expecting to achieve a further increase of sales and earnings against the extremely good previous year and further growth in the year to come.

Mühlbauer Holding AG & Co. KGaA

With approximately 2,400 employees and its technology centers in Germany, Malaysia, the USA and Slovakia, as well as a global sale and service network, the Mühlbauer Group is an internationally leading technology and system partner for the realization of innovative ID projects. As developer and manufacturer of the complete range of hardware and software systems in-house, customers benefit particularly from the expertise of the solution provider for the recording of personal and biometric data, the production and personalization of individual ID documents such as ID cards and ePassports, through to fully automatic access controls, which it gained over a period of thirty years. As leader in the contactless identification of goods and flows of goods, Mühlbauer renders the complete Smart Label factory available for the production of RFID Smart Labels for the security, supply and textile industries and for retail. Additionally, the company develops and produces innovative system for specific niche applications in the semiconductor backend area, automation solutions, labeling and marking systems for the tracking of electronic components as well as precision parts for sensitive industries and its own products.

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