revenue for the first nine months of 2007 up 1.3 percent to € 115.1 million / margin burdened by special effects / EBIT € 11.4 million - 4 percent / net profit for the period on prior-year level / targets for 2007 slightly revised

The consistently strong business performance of the first two quarters of 2007 was repeated in the third quarter. Revenue for the technotrans Group again showed a slight rise, to € 38.6 million (previous year € 38.1 million, +1.1 percent). The nine-month revenue figure was thus € 115.1 million, up 1.3 percent on the prior-year period (€ 113.6 million). After the elimination of currency effects, consolidated revenue would have been another € 2 million up on the prior-year period, equivalent to growth of a notable 3.1 percent.

Gross profit reached € 12.8 million (previous year € 13.2 million, -3.2 percent) in the third quarter. The gross margin was consequently slightly weaker, at 33.1 percent. After nine months, gross profit amounted to € 38.8 million and was therefore unchanged from the previous year (€ 39.0 million); the gross margin was 33.7 percent.

Due to the lower gross profit, earnings before interest and taxes (EBIT) amounted to only € 3.6 million in the third quarter (€ 4.0 million, -9.3 percent); this corresponds to an EBIT margin in relation to revenue of 9.3 percent (previous year: 10.4 percent). At the nine-month mark, EBIT was € 11.4 million (previous year € 11.9 million, -4.0 percent) and the margin correspondingly 9.9 percent (previous year 10.5 percent).

The effective tax rate was once more 38.1 percent at the reporting date.

A net income for the period of € 2.1 million was thus generated in the third quarter (previous year € 2.2 million), down 3.3 percent on the reference period. The net income for the nine-month period was € 6.85 million (previous year € 6.95 million, -1.4 percent). The basic earnings per share are consequently € 1.00 (previous year € 1.04).

Since the start of the year the number of employees in the group has risen from 752 to 834, an increase of 10.9 percent. The employee total in Germany has actually grown by 64 individuals or 12.5 percent.

The Board of Management resolved to buy back a number of treasury shares on August 30, with the extent of this measure initially capped at 5 percent until the end of 2007. By the end of the quarter, a total of 21,527 shares had been acquired via the stock market at a weighted average price of € 19.23. No decision has yet been reached on how these treasury shares are to be used.

“The significant increase in employees in our Group as well as the share buy-back should be regarded as proof of management’s firm believe, that the company will continue its growth strategy. Sooner or later the future positive development will also be reflected in the valuation,” Heinz Harling, Chairman of the Board of Management of technotrans AG, pointed out.

Revenue in the Technology segment reached € 29.3 million in the third quarter, 1.4 percent more than in the corresponding prior-year period (€ 28.9 million). This brought the revenue for the segment up to € 87.7 million for the first nine months of the 2007 financial year (previous year € 87.2 million, +0.6 percent). The result for the segment was again diminished by various factors in the third quarter (acquisition of rotoclean, new releases, etc.), with the result that it was well down on comparable quarters at € 1.8 million. The rate of return for the segment was consequently only 6.2 percent. The overall result for the segment after nine months was € 6.7 million (previous year € 8.1 million, -17.0 percent) and the rate of return for the segment thus 7.6 percent.

The Services segment generated revenue of € 9.2 million in the third quarter. This mirrors the high level of the corresponding prior-year quarter and shows an increase on the preceding quarters (€ 9.1 million in each case). The nine-month revenue figure thus reached € 27.4 million, up 3.9 percent on the previous year (€ 26.4 million). The result for the segment also made pleasing progress. The figure for the third quarter was € 1.6 million, equivalent to a rate of return for the segment of 17.4 percent and therefore on a par with the figure for the excellent prior-year quarter. Overall, the result for the segment after nine months rose to € 4.4 million, a gain of 20.4 percent compared with the corresponding prior-year figure. The rate of return for the segment was therefore 16.0 percent and, after an initial dip in the margin in the first half of the year, returned to a satisfactory level.

“As already described in the first-half report, various structural changes lay behind these figures,” Dirk Engel, Chief Financial Officer, explains. “Relinquishing trade revenue in the USA left us needing to compensate for an amount in the high single-digit millions in 2007. We were able to achieve this in part through the acquisition of rotoclean and its technologies in the domain of cleaning systems. We have moreover continued to enjoy sound growth in our organic business. Taking into account also the exchange-rate effects we are overall entirely satisfied with the slight growth that we are able to report.”

“We had hoped for a slightly more dynamic development in the second half of the year,” says Heinz Harling. “But this proved unfeasible in the current industry environment.” As matters stand Management therefore expects that technotrans will not quite reach the revenue target of € 160 million for 2007 and that the total will rather be in the order of € 154 million. “This difference of some 4 percent will also have an impact on our year-end earnings,” says Dirk Engel. “We expect that the EBIT margin will reach 10 percent as planned in spite of the burden from the acquisition of around € 2 million but in absolute numbers will reach rather € 15.5 million than €17.5 million for the year. As a result, instead of the planned net income of € 10.5 million we will probably close the year on a figure between € 9.0 and € 9.5 million.” The Group’s performance is a reflection of the state of the printing industry in general, which has now stabilised at the current level following years of disproportionately high growth.

“We regard this as an amply positive signal, because there has evidently been no significant dip in investment propensity in the run-up to the forthcoming drupa industry exhibition in May 2008. We are now looking to next year with some anticipation because we know from experience that the orders clinched during drupa by printing press manufacturers are sufficient to fill their books until well into the year,” Heinz Harling explains. “As in the case of our cleaning systems, we nevertheless do not build such "hopes" into our budgets for the coming year, preferring to put our faith in the successful progress of our core business,” adds Dirk Engel. “Our overriding goal here is to secure a steady improvement in our profitability.” Furthermore he expects that technotrans will be able to profit from virtually all the tax cuts being introduced under the umbrella of Germany's corporate tax reform from 2008.