Nordex achieves significant earnings increase in stub fiscal year

The report released by Nordex AG for the stub fiscal year 2004 (October 1 – December 31, 2004) largely corresponds to the preliminary figures on the financial statements announced by the Group at its annual general meeting in February 2005. The positive news was a surge in new business by 11%, to EUR 62 million (previous year: EUR 55.5 million), especially the share generated abroad, which grew to reach 70% (previous year: 32%). In contrast, sales revenues were down by 11%, to EUR 59 million (previous year: EUR 66.7 million). The company cites the difficult financial situation as the primary reason for this. In the period under review – prior to the meanwhile largely concluded refinancing – the company did not have sufficient funding to cover all current projects. Due to the low capacity utilization, Nordex did not manage to fully cover its costs, even though substantial cost reductions were achieved thanks to the restructuring of the company's operations. For instance, the cost of materials ratio declined from 84% to 78%, personnel expenditure fell by 4%, to EUR 8.6 million, and the balance of other operating expenses and income dropped from EUR 5.5 to EUR 5.4 million. Earnings before interest, taxes and extraordinary expenditure rose by 50%, to reach –EUR 3.3 million (previous year: -EUR 7.0 million).

On account of the refinancing, the company anticipates a substantial improvement in capacity utilization, particularly in the second half of the current fiscal year. The first half of the year will continue to see delayed negative impacts from the previous, weak financial periods. Depending on the volume of business, for 2005 as a whole an operating result before extraordinary expenditure (transaction costs within the scope of the refinancing) ranging from –EUR 2.0 million to break-even point is expected to be achieved.