Bielefeld. World-wide, both economic development and demand for machine tools continued to be restrained. As previously announced, the third quarter went well for GILDEMEISTER. We were able to close the quarter on target and, compared with the rest of the industry, to maintain our current position in the continuing difficult economic environment. In the first nine months, sales reached Euro 701.5 million (-1%). The intake of new orders amounted to Euro 700.8 million (-5%). As announced, at Euro 19.4 million, EBIT (earnings before interest and tax) were positive. At Euro 1.1 million EBT (earnings before taxes) were also positive as at 30 September (previous year: Euro -17.5 million). At Euro 328.1 million, orders on hand continue to represent a satisfactory basic capacity utilisation.
GILDEMEISTER plans to close the fourth quarter with better results than the preceding quarters, as is customary in the industry. With an improved demand situation resulting from a fresh stimulus caused by the autumn trade fairs, particularly the EMO in Milan, we will be able to achieve our planned intake of new orders for the entire year in the face of the continuing difficult market situation. Sales might again exceed Euro 1 billion. Based on measures already initiated, we still expect an overall positive result for the financial year. The distribution of a dividend will only be considered once the group has obtained another adequate net profit for the year.
Group sales for the third quarter amounted to Euro 230.7 million, and by 30 September had reached Euro 701.5 million, which is almost the level for the corresponding period of the previous year (-1%). Compared with the rest of the industry (-7%) GILDEMEISTER was able to develop well. At 51% the export share remained constant. International sales amounted to Euro 355.5 million (previous year: Euro 359.0 million). Domestic sales reached Euro 346.0 million (corresponding period of the preceding year: Euro 353.1 million).
In the third quarter the intake of new orders of Euro 229.1 million was 6% below the figure for the previous quarter, which was due to the holiday season and customers' wait-and-see attitude in the run-up to the EMO. As of 30 September the intake of new orders totalled Euro 700.8 million. Domestic orders reached Euro 324.6 million. International orders amounted to Euro 376.2 million. The export share rose to 54% (same period of the preceding year: 53%). As planned, we continued to increase our export share in Asia, particularly in the PR of China.
On 30 September, 2003, the group's orders on hand amounted to Euro 328.1 million.
Despite the continuing difficult economic setting, GILDEMEISTER achieved the planned business targets for the third quarter. EBITDA amounted to Euro 45.7 million (previous year: Euro 29.0 million). Both EBIT (earnings before interest and taxes) of Euro 8.4 million (previous year: Euro -10.6 million) and EBT (earnings before taxes) of Euro 2.6 million (previous year: Euro -17.8 million) were positive in the third quarter. In the first nine months, EBIT amounted to Euro 19.4 million (previous year: Euro 0.5 million) and EBT also achieved a profit of Euro 1.1 million (previous year: Euro -17.5 million). With the application of the IFRS accounting principles and the setting up of deferred taxes, tax expenditure as of 30 September amounted to Euro 8.6 million (previous year: Euro 6.1 million). The reporting period still shows a net loss for the year of Euro 7.5 million (previous year: Euro -23.6 million). In the third quarter, the quality of performance has noticeably improved against the corresponding figure for the previous year. The improvement in performance (EBT) in the third quarter against the previous year amounts to Euro 20.4 million.
The GILDEMEISTER share recorded another price advance. The share that was quoted at Euro 3.35 on 31 March, reached Euro 4.80 by the end of the first six months and closed the third quarter at a price of Euro 5.75. It is currently quoted at Euro 6.25 (04.11.2003).
On 30 September, 2003, GILDEMEISTER employed 5,042 people, 207 of whom were trainees. Compared with the previous year this is a decrease of 46 employees. Whilst the production site in Shanghai and the sales and services companies in Asia, Europe and Germany were specifically reinforced, staff levels at the productions sites Geretsried, Bielefeld, Bergamo and Seebach were reduced in line with business development. In this financial year, the group's reconstruction along with the further strengthening of the service area and the internationalisation of our production, resulted in a relocation of staff capacity. One of the key aims of this measure was to safeguard the locations in Germany. Staff costs of Euro 199.8 million were below those for the same period of the preceding year (Euro 201.7 million).
FORECAST 2003: GILDEMEISTER continues to plan for the financial year 2003 with restrained optimism. Thanks to our innovative products and world-wide operating sales and services organisation, the DMG-Vertriebs- und Serviceorganisation, we are well prepared for any market recovery.
With respect to the intake of new orders we expect a gradual improvement in demand for machine tools. An indicator of this improvement was our success at the EMO trade fair in Milan. In all, 172 machines totalling almost Euro 30.3 million were sold. In addition, the number of project enquiries has steadily risen so that we expect to be close to our planned intake of new orders for the entire year.
In line with industry trends, we anticipate higher group sales figures for the fourth quarter so that sales could again exceed Euro 1 billion over the entire year.
Further activities to improve performance have been initiated. We intend to close the fourth quarter with a profit. For the overall year 2003 we expect earnings to be positive (EBT) and a balanced result after taxes. The distribution of a dividend will only be considered once the group has obtained another adequate net profit for the year.
The Executive Board