News

LEONI Histral® - 100% Cadmium free alloy wire - 6th November 2006

After years of development, LEONI has successfully created a 100% cadmium free alloy wire. It is superior to conventional copper cadmium wire, both in terms of its electrical and mechanical properties.

Until now copper cadmium has been used for electrical conductors which have to exhibit high mechanical strength. Since EU law has now banned the use of cadmium in any form in motor vechicles and domestic appliances, LEONI has developed its own high strength cadmium free alternative alloy, which is free of harmful substances - LEONI Histral®.

LEONI Histral® is a registered trademark of LEONI Draht GmbH.

Leoni remains on expansion course - 2nd November 2006

• Sales rise 35 percent in the first nine months of 2006
• Consolidated net income up by disproportionately strong 77 percent
• New orders from the automotive and the commercial vehicle industry

Nuremberg – Leoni AG succeeded in maintaining its dynamic pace of growth so far in 2006. Compared with the same period of last year, sales in the first nine months rose by nearly 35 percent to EUR 1,525.6 million (from the previous year’s EUR 1,134.2 million). Organic growth accounted for about twelve percentage points of the increase, while the new subsidiaries provided approximately ten percentage points and the remaining 13 percentage points were due to the increased price of copper. Thanks to the larger volume of business as well as increased efficiency, Leoni also further improved its earnings: Consolidated earnings before interest and taxes (EBIT) grew by about 47 percent to EUR 103.8 million in the first three quarters of 2006 (EUR 70.7 million in the previous year). Consolidated net income was up by a disproportionately strong 77 percent to EUR 60.7 million in the period under report (EUR 34.3 million in the previous year).

Leoni’s consolidated sales in the third quarter of 2006 were up by just over 38 percent on the pre-year period to EUR 536.7 million (EUR 388.2 million). EBIT climbed by about 34 percent to EUR 37.7 million in the same period (from the previous year’s EUR 28.2 million) and consolidated net income was up more than 43 percent to EUR 22.3 million (EUR 15.5 million). Group-wide, the number of employees stood at 34,753 on 30 September 2006 (31,401 in the previous year). Of this total, 3,803 people (3,087 in the previous year) were employed in Germany and 30,950 (28,314) in other countries.

Extensive new orders for the Wiring Systems Division

During 2006 Leoni’s Wiring Systems Division succeeded in gaining further large-scale orders from, among others, customers Audi, BMW Group, DaimlerChrysler and General Motors as well as from the commercial vehicle industry. At their peak, these orders will amount to sales of more than EUR 400 million. About half involve new projects from which Leoni will generate considerable additional sales. The other orders involve key follow-on projects that will also ensure utilisation of Leoni’s capacity over the medium term. In the first nine months of 2006, sales in the Wiring Systems Division rose by nearly ten percent year on year to EUR 710.6 million (from EUR 646.4 million), while EBIT was up by 25 percent to EUR 50.8 million (from EUR 40.6 million). The ongoing major projects for BMW Group, DaimlerChrysler, General Motors and Land Rover continued to be the mainstays of sales. Leoni also succeeded in substantially expanding the volume of its business with component suppliers and commercial vehicle manufacturers.

Wire & Cable Division making strong gains

Underpinned by the good order situation in all segments, successful integration of new subsidiaries and the increased price of copper, the Wire & Cable Division’s sales grew by about 67 percent to EUR 815.0 million in the first three quarters (from EUR 487.8 million in the previous year). EBIT improved by almost 77 percent to EUR 53.0 million (EUR 30.0 million). Studer Draht- und Kabelwerk AG, the Switzerland-based special cables company acquired at the end of July 2006 and which was also the focal point of capital spending, already contributed to the Wire & Cable Division’s business success in the third quarter. With Studer Leoni AG will, among other things, expand its position in the market for industrial and transport engineering cables. The Wire & Cable Division will in the future obtain further beneficial impetus from Leoni HighTemp Solutions GmbH, the high temperature cable specialist based in Halver, North-Rhine Westphalia that will shortly commence production, and from the Austrian, Gmünd-based NBG Fiber-Optic GmbH, acquired in early October, which will strengthen the glass fiber cable systems business.

Growth forecasts for 2006 reaffirmed

Leoni remains confident about 2006 as a whole: The Wiring Systems Division is forecast to generate sales growth to approximately EUR 930 million (from EUR 879.4 million in the previous year). From today’s perspective, the Wire & Cable Division will substantially increase the volume of its business to more than EUR 1 billion (from EUR 668.6 million). On this basis, the Leoni Group is likely to record a sales increase of about 30 percent to roughly EUR 2 billion (EUR 1.55 billion in the previous year) and thus to reach the upper end of the forecast range, which the Company had already raised at the end of the first half. Consolidated operating earnings (EBIT) should also show a significant gain (from the previous year’s EUR 102.8 million) to the upper end of the projected range between EUR 125 and 130 million. The same applies to consolidated net income, which will probably rise to between EUR 72 and 75 million (from EUR 56.1 million).