07/05/08

Würth Group successfully closes business year 2007 - Sustainable revenue guarantees long-term success

  • Consolidated sales increase by 9.6 percent to EUR 8.49 billion
  • Operating result perked up by 24.3 percent to EUR 640 million
  • Over 63,000 employees worldwide (+16.0 percent)
  • Equity ratio is at 42.3 percent

Künzelsau/Stuttgart. On 7 May 2008, the Künzelsau-based Würth Group presented the consolidated financial statement for the fiscal year 2007 at their press conference in Stuttgart.

The Würth group of companies, which is active in 86 countries of the world with over 400 companies, can look back on a highly successful business year 2007. The company stepped up its sales volume by 9.6 percent on the previous year, reaching a total of EUR 8.49 billion. This growth rate was attained despite a weak economic development in the United States and the currency effects caused by the weak U.S. dollar. Adjusted for currency exchange rates, the sales increase even came up to 10.5 percent. The Group’s figures soared also in terms of the operating result. At 24.3 percent, the operating result grew at a faster pace than sales, rising to EUR 640 million.

Highest sales volumes in Metal and Auto divisions - Construction division records greatest sales increase

The 136 Würth Line companies trading in assembly and fastening materials in the Group’s core business grew by an average of 9.2 percent in 2007, pushing their sales volume to EUR 4.94 billion. The Metal and Auto divisions recorded the strongest sales volumes in the business year 2007. The Metal division achieved a sales figure of EUR 1,469 million, while the Auto division attained EUR 1,315 million. In percentage terms, the Construction division achieved the highest sales increase at 13.9 percent (sales volume: EUR 500 million).

The Würth Group’s 264 Allied Companies, who operate in business fields adjacent to assembly and fastening material, displayed dynamic growth in the business year 2007, increasing their worldwide sales volume by 10.1 percent to EUR 3.55 billion.

“Thanks to our decentralized structure, we demonstrate a high degree of adaptability in all business units and regions, helping us to use various levers in a flexible manner to be successful. Amongst other things, this is reflected in the sales structure and our product range which we adapt flexibly to our customers’ requirements in the respective markets,” Robert Friedmann describes the Würth Group’s strategy.

Double-digit sales growth in Germany

The German Würth Group companies generated EUR 3.45 billion last year, corresponding to sales growth by 10.4 percent. This means that Germany contributes over 40 percent to the total sales volume generated by the group of companies. The Würth Group’s parent company, Adolf Würth GmbH & Co. KG, has played a central role in this success. It was the first individual company to generate over one billion euros in sales including Group-internal sales within one business year.

The international companies improved their sales figure by 9.0 percent to EUR 5.04 billion. 86 percent of the Würth Group’s sales volume were generated within Europe. The Würth Group attained considerable growth rates in all regions save the U.S. The sales volume in the U.S. companies decreased by 4.7 percent to EUR 746 million. The reasons underlying this development were firstly the weak performance showed by the U.S. dollar against the Euro and secondly the uncertainty in the U.S. marketplace brought about chiefly by the crisis in the real estate market.

Over 1,000 new jobs created in Germany

The Würth Group hired new employees again in 2007. All in all, the number of employees increased by 16.0 percent to 63,699, with 5,282 colleagues being added by virtue of company acquisitions. What is particularly pleasant is that the Würth Group managed to create over 1,000 new jobs in Germany for the second year in a row.

The Group, whose success is primarily founded on a strong direct-selling team, attaches particular importance to the development of its sales force. The number of sales reps increased by 5.6 percent to 30,650 in 2007.

Above-average equity ratio

The Würth Group invested EUR 479 million in its markets in the past business year. This is EUR 54 million more than in the previous year. EUR 227 million (47.4 percent) were spent in Germany. The focus of the capital expenditure was placed on new warehouse buildings and warehouse expansions in the sales companies as well as the expansion of technical plants and machines in the production companies.

As in previous years, the capital expenditure could be covered in their entirety from self-generated funds. The Würth Group’s gross cash flow amounted to EUR 745 million (2006: EUR 605 million). The ratio between capital expenditure and gross cash flow showed a slight improvement on the previous year at 64.3 percent (2006: 70.2 percent). The cash flow from operative activities increased slightly on the previous year by 23.0 percent to EUR 506 million.

In the business year 2007, the Würth Group’s equity grew by EUR 124 million to EUR 2.40 billion. This means that the Group has an equity ratio of 42.3 percent, which continues to be far above the average of European trading companies. The Würth Group’s very good financial position and the Group’s positive future prospects were corroborated by the leading rating agencies Standard & Poor’s and Fitch Ratings, who confirmed the rating “A / outlook stable” in 2007.