20.04.2005 – 07:39

SW Umwelttechnik Stoiser & Wolschner AG

euro adhoc: SW Umwelttechnik Stoiser & Wolschner AG
Restructuring & Recapitalisations
SW Umwelttechnik announces results for 2004 and planned capital increase

Disclosure announcement transmitted by euro adhoc.
  The issuer is responsible for the content of this announcement.

20.04.2005

* POA more than trebled
* Order backlog up by 177%
* Recommended dividend EUR0.20 per share
* Capital increase to finance construction of two factories in   
  Romania

At a press conference today SW Umwelttechnik (Vienna Stock Exchange
symbol: SWUT) joint chief executives Heinz Wolschner and Dr. Bernd
Wolschner announced the company’s results for 2004 and unveiled plans
for a capital increase.

Heinz Wolschner told journalists: "Due to the excellent growth
prospects for all our business sectors — Water Conservation,
Engineering and Infrastructure — in Central and Eastern, and
Southeastern Europe, we intend to increase the Company’s issued
capital by up to 10%. We will be using the anticipated issue proceeds
of about EUR2.4 million (m) to build a new pipe works in Western
Romania this year, and put it into operation in 2006. We also plan to
build a factory in Bucharest next year — initially for our
Infrastructure sector."

Capital increase
The Management Board will issue up to 59,999 new shares, equal to up
to 10% of the company’s share capital, to finance further expansion
in Romania. The new ordinary bearer shares will be offered between 21
April and 9 May 2005. Dividend rights will be retroactive to 1
January 2004. The shares will be offered to existing shareholders and
prospective investors using a bookbuilding procedure. The price will
be determined by this procedure but will be limited to EUREUR.Initial
listing on the Vienna Stock Exchange is scheduled for 12 May 2005.
The issue will be lead managed by Erste Bank.

Trading performance in 2004
Summing up the company’s trading performance in 2004, Dr. Bernd
Wolschner said: "Financial 2004 was a year of successful
consolidation for SW Umwelttechnik, in preparation for further
expansion in Central and Eastern, and Southeastern Europe. In line
with our strong CEE and SEE focus, we built out our market positions
in Hungary, Romania and Slovakia and proceeded with our tough
consolidation programme in Austria. Helped by the positive trend in
the euro-forint exchange rate, we achieved a marked improvement in
earnings."

Revenue
Revenue increased by 1%, from EUR75.4m to EUR76.3m in financial 2004.
The revenue contribution of the Hungarian operations rose from 67% to
70%, and their revenue expanded by 6% in absolute terms due to the
positive trend in this market. The Water Conservation and
Infrastructure sectors recorded double-digit revenue growth in
Hungary while the Engineering business lost ground as a result of
delays in awards of public contracts for sewerage systems and
wastewater treatment plants.

The revenue share accounted for by the Austrian market was unchanged
at 25%. The flat demand for wastewater treatment plants and sewer
systems encountered by the Water Conservation sector was offset by
growth in the Engineering sector’s renewable energy business, which
has already won ten contracts for the design and/or construction of
biogas plants.

The combined revenue contribution of other EU member states, and
other CEE and SEE countries (Italy, Romania, Croatia, Germany,
Slowakia and Slovenia) was 5%.

There was a shift in the segmental breakdown of revenue, with the
contribution of the Infrastructure sector climbing from 39% to 42%
due to its good performance in Hungary. Order placement delays in
Hungary led to a drop in the share of revenue accounted for by the
Engineering sector from 33% to 31%. The contribution of the Water
Conservation sector edged down from 28% to 27%.

Earnings
EBIT was significantly impacted by three factors in 2004. A 50%
average run-up in steel prices reduced earnings by more than EUR1m in
2004, and it was not possible to pass on the increases until the
third quarter. Earnings were also hit by stiffening competition in
Austria and by hold-ups in contract awards to the Engineering sector
in Hungary. Together these influences cut EBIT from EUR3.4m to
EUR2.3m, and EBITDA from EUR7.2m to EUR6.2m.

Meanwhile however finance cost declined markedly, from EUR2.9m in the
previous year to EUR0.3m. This improvement reflected EUR1.3m in
exchange gains due to the fact that financing of the Hungarian
operations is predominantly euro denominated — a decision now seen to
be cutting long-term finance costs.

As a result, profit on ordinary activities more than trebled, jumping
by 280% from EUR0.5m in 2003 to EUR2.0m. There was also a marked
upturn in profit after tax, from EUR0.3m to EUR1.5m, owing to the
lighter tax burden. Reduced minority interests in subsidiaries
contributed to a swing from a net loss after minorities of EUR0.3m in
2003 into a net profit of EUR1.6m. Earnings per share rebounded to
EUR2.84, following a loss of EUR0.56 in 2003.

Asset and capital structure
There was a major improvement in the company’s balance sheet in 2004.
Reduced prefinancing by the Engineering sector in Hungary and strong
cash flows from operating activities cut financial liabilities from
EUR40.5m to EUR34.8m, and total equity and liabilities fell by 4.6%,
from EUR71.4m to EUR68.1m.

Capital and reserves advanced from EUR18.0m to EUR20.0m owing to the
positive earnings situation and the revaluation of the Hungarian
forint. This and lower total equity and liabilities meant that the
equity ratio rose from 25.2% to 29.4%.

Employees
The headcount fell from 755 to 723, lifting revenue per employee by
6%.

Capital expenditure and R&D
Following the completion of major investment programmes in the
previous year, the investment budget was slimmed to EUR3.5m in 2004.
The lion's share of investment — some 77% — went to the Hungarian
operations, most of it being channelled to the next expansion phase
at the South Budapest factory. Spending in Austria largely concerned
replacement investments. Direct R&D spending amounted to EUR0.4m
(2003: EUR0.5m) or 0.6% of revenue. The main R&D priorities were
surface water protection, separation and biogas system developments.

Dividend recommendation
Due to the positive earnings trend, and in order to enhance the
attractiveness of the company’s stock, the Management Board will be
recommending a dividend of EUR0.20 to the Annual General Meeting.
This will also be paid to holders of the new shares.

Outlook
Management plans to press ahead with expansion in the CEE and SEE
regions, as it is in these markets that the conditions are conducive
to rapid revenue and earnings growth.

Management continues to see the outlook for all the company’s
business sectors in the Hungarian, Romanian and Slovakian markets as
highly positive due to existing or impending EU membership. With
order backlog at balance sheet date almost trebled to EUR36m at
balance sheet date (2003: EUR13m) there is good reason for expecting
that SW Umwelttechnik will trade well in 2005.

In Austria, the acquisition of Alpha Umwelttechnik GmbH, Klagenfurt
from the Wienerberger Group on 1 January 2005 is expected to result
in a shake-out in the market served by the Water Conservation sector.

Investment will more than double to about EUR7.8 m in 2005. The main
focus will be on Hungary and Romania. Hungary’s most modern pipe
works is currently under construction at the company’s South Budapest
site, and is due to start up during the third quarter of 2005.

Following the establishment of a sales and marketing organisation in
Romania, a pipe works is to be built for the Water Conservation
sector in Ortisoara, near Timisuara during the second half of this
year. SW Umwelttechnik has already won its first major drinking water
supply and sewer network construction contracts in this important
growth market. The anticipated proceeds of the capital increase are
also to be used to build a factory for the Infrastructure sector, and
subsequently one in the Bucharest area for the Water Conservation
sector. Planning work is already under way.

end of announcement                    euro adhoc 20.04.2005 07:00:00 

Further inquiry note:

DI Heinz Wolschner, Vorstand der SW Umwelttechnik
Tel.: 0043/463/32109-0, Fax: 0043/463/37667
MMag. Christian Riel, Finanzen/Investor Relations
Tel.: 0043/664/4337105, Fax: 0043/1/3688686,
mailto:christian.riel@sw-umwelttechnik.at
Website: http://www.sw-umwelttechnik.at

Branche: Technology
ISIN: AT0000808209
WKN: 080820
Index: WBI, ATX Prime, ViDX
Börsen: Berliner Wertpapierbörse / free trade
Baden-Württembergische Wertpapierbörse / free trade
Börse Düsseldorf / free trade
Wiener Börse AG / official dealing