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| Dräger reports positive nine-month figures for 2006/Group continues growth story |
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- EBIT up 12.4 percent*
- Order intake up 12.7 percent
- Revenues up 9.5 percent
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| Lübeck, Germany, November 14, 2006 – The Dräger Group, a global leader in medical and safety technology, reported another significant increase in EBIT, order intake and revenues in the first nine months of 2006. The foreign business of the two subgroups Dräger Medical and Dräger Safety was strong, accounting for 79.4 percent of consolidated revenues. |
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| Q1-Q3/2006
| Q1-Q3/2005
| Change
| Order intake |
€1,365.6 million |
€1,211.5 million |
12.7% |
| Revenues |
€1,219.5 million |
€1,114.2 million |
9.5% |
EBIT before non-recurring
expenses |
€75.0 million |
€66.7 million |
12.4% |
| EBIT margin |
6.2% |
6.0% |
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| Net profit |
€30.4 million |
€23,5 million |
+29.4% |
Headcount as of
September 30 |
9,897 |
9,645 |
+2.6% |
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**The figures have not been audited. |
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| EBIT increased 12.4 percent, up from EUR 66.7 million (before non-recurring expenses) in the prior-year period to EUR 75.0 million. The gross margin dropped slightly to 48.6 percent (9M/2005: 49.3 percent), which was chiefly due to the completion of projects. Functional costs developed as planned, rising proportionately less than revenues. The research and development costs included in this figure come to EUR 85.9 million or 7.0 percent of revenues. The tax expense decreased against the prior-year period due to the change in legal form of Dräger Medical. Overall, the first three quarters of the year saw net profit climb by 29.4 percent to EUR 30.4 million. |
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| At the end of the third quarter of 2006, both order intake and revenues were substantially higher. Order intake rose by 12.7 percent to EUR 1,365.6 million (9M/2005: EUR 1,211.5 million). This is more than three quarters of the revenues budgeted for the year. The two subgroups Dräger Medical and Dräger Safety contributed equally to the Group’s strong performance. Consolidated revenues climbed 9.5 percent to EUR 1,219.5 million (9M/2005: EUR 1,114.2 million). |
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| Growth was primarily generated in Europe excluding Germany (revenues up 11.7 percent to EUR 489.7 million) and the Americas (revenues up 22.4 percent to EUR 275.0 million). Despite conditions remaining difficult, order intake increased in Germany, with our home market developing particularly well for Dräger Safety. |
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| The Dräger Group’s equity dropped slightly by EUR 4.6 million to EUR 498.2 million, which translates into an equity ratio of 31.7 percent (December 31, 2005: 32.7 percent). The change in equity is primarily attributable to net profit as well as to the payment of dividends and the share in net profit of minority shareholders for the prior year. |
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Dräger Medical |
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- Double-digit growth in order intake and revenues in the first nine months/Business continues to grow much faster than the market
- EBIT up 8.7 percent*
- Order intake up 12.1 percent
- Revenues up 11.1 percent
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| Dräger Medical closed the first nine months of 2006 with EBIT (before non-recurring expenses) of EUR 53.5 million. Compared to the prior year, this corresponds to an increase of 8.7 percent (9M/2005: EUR 49.2 million). At 6.4 percent, the EBIT margin was slightly lower than in the same prior-year period (2005: 6.6 percent). |
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| Order intake rose by 12.1 percent from EUR 821.4 million in 2005 to the current EUR 920.4 million. Revenues climbed 11.1 percent to EUR 830.1 million (2005: EUR 747.4 million). Changes in exchange rates only had a marginal effect on the rise in order intake and revenues, contributing around 0.2 percent in each case. |
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| In the first nine months of the year, the Americas and Europe excluding Germany were again the growth drivers for the company. At EUR 231.3 million, order intake in the Americas grew the most out of all the regions, climbing 26.3 percent on the prior-year period. Revenues from this region increased by 28.1 percent to EUR 210.2 million, in the US, revenues rose by 12.4 percent. |
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| At EUR 189.0 million, order intake in Germany was up 1.3 percent on the prior-year period, while revenues fell slightly by 1.2 percent to EUR 170.6 million. These developments reflect the current inertia on the domestic market. |
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| Europe excluding Germany continues to perform well. Order intake is up 15.9 percent to EUR 356.3 million, while revenues climbed 16.5 percent to EUR 310.5 million. |
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| In Asia/Pacific, order intake dropped 12.4 percent to EUR 83.6 million and revenues by 11.4 percent to EUR 83.1 million. |
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| All in all, Dräger Medical continues to grow faster than the market. Estimates of global growth in the acute point of care (“APOC”) sector including home respiration remain in the region of two to three percent per annum. The reasons for Dräger Medical’s growth rate include the further expansion of its global sales structure and the ongoing drive to improve internal processes as well as a product portfolio that meets customers’ requirements. |
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| The company generated further synergies by introducing a shared services structure for its US operations. Alongside the realignment of the US subsidiaries, SAP was successfully implemented at both US locations and in all business areas. SAP was also implemented in Italy and Austria, spreading the use of standardized software to more key countries. This will improve the transparency of business processes. |
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| The patient monitoring business also played a significant role in the third quarter. The company’s therapy units with integrated monitoring sold well in all regions, with demand for CareArea™ solutions in the perioperative field remaining the strongest. |
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| The progress made by the innovation campaign is evidenced by renewed high research and development expenditure of EUR 63.9 million, which corresponds to 7.7 percent of revenues. Investments increased by 27.8 percent to EUR 19.3 million. |
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| Regardless of the global developments in the healthcare sector, the company sees itself well positioned to continue its market success. At Medica 2006, the largest medical trade fair in the world, Dräger Medical plans to present an important innovation which will help the company to tap a new market segment. |
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Dräger Safety
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- EBIT still growing faster than revenues
- EBIT up 13.7 percent
- Order intake up 11.7 percent
- Revenues up 4.1 percent
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| In the first nine months of 2006, Dräger Safety generated EBIT of EUR 36.5 million. The subgroup thus improved EBIT by 13.7 percent on the prior year. |
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| Order intake rose by 11.7 percent to EUR 463.0 million (9M/2005: EUR 414.6 million). The delivery dates requested by customers are partly in the fourth quarter of 2006 or next year, such that a portion of this high order intake can only be recognized as revenue in 2007. |
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| Dräger Safety’s global revenues rose year on year by 4.1 percent to EUR 407.4 million in the first nine months of 2006 (9M/2005: EUR 391.3 million). This growth in order intake and revenues was again achieved through core business, but also on the back of projects in all regions and product divisions. |
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| The market position in the Americas was expanded, both in terms of order intake (up 5.5 percent) and revenues (up 7.1 percent) year on year. The current trend was again driven by the subgroup’s core business. |
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| In Germany, the strained financial situation and the resulting tight rein on public spending and a tougher competitive environment persisted in the first nine months of 2006. During the period under review, however, order intake and revenues in Dräger Safety’s core business increased by four percent and nine percent, respectively. |
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| In Europe (excluding Germany), order intake was up 19.1 percent, with revenue growth of 4.2 percent. |
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| In Asia/Pacific, order intake rose by 15.8 percent and revenues by 11.6 percent, allowing the company to expand its market position further. |
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| Investments in the first nine months of 2006 amounted to EUR 18.4 million (9M/2005: EUR 19.1 million). Research and development expenditure amounted to 5.3 percent of revenues (9M/2005: 4.6 percent) or EUR 21.5 million, and was largely channeled into new products. |
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| Dräger Safety’s two new strategic business units, Dräger Safety Solutions and Compliance, are performing well. Both business units displayed the highest growth in order intake in the first nine months of 2006. Dräger Safety Solutions is responsible for planning, developing and delivering customized system solutions, e.g. workshop, training, breathing gas management and rescue systems. Compliance is engaged in core business, selling industrial occupational safety products, e.g. small-scale respiratory protection equipment, via dealers. |
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| If the market environment remains the same, Dräger’s Executive Board forecasts revenue growth of seven to ten percent for Dräger Medical and three to five percent for Dräger Safety. Overall, the Dräger Group expects to achieve revenue growth of six to eight percent as well as a slightly greater increase in EBIT (before non-recurring expenses) and net profit. The subgroups also expect the increase in EBIT (before non-recurring expenses) to be somewhat higher than revenue growth. |
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*(compared with 9M/2005 before non-recurring expenses) |
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This press release contains forward-looking statements regarding the development of the Dräger Group. No assurance can be given as to the content of these statements as they are based on assumptions and estimates that entail certain risks and uncertainties. |
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