HORNBACH continues to outperform the sector

28 juni 2007Successful first quarter of 2007/2008: DIY megastores with garden centers achieve like-for-like sales growth of 4.6 percent / Pleasing earnings performance in core business / Expansion maintained with three new store openings Bornheim, June 29, 2007. HORNBACH, one of Europe's largest DIY groups, continued to generate significantly higher growth than the sector as a whole in the first quarter of the 2007/2008 financial year (March 1 to May 31, 2007). The DIY megastores with garden centers achieved like-for-like sales growth of 4.6 percent. The company has continued its expansion across Europe with three new store openings (in Munich, Darmstadt and Alblasser-dam/Netherlands). Sales at the overall HORNBACH HOLDING AG Group rose by 5.2 percent in the first quarter to reach Euro 732.7 million (compared with Euro 696.7 million in the equivalent period in the previous year). The HORNBACH-Baumarkt-AG subgroup improved its sales by 5.6 percent to Euro 696.0 million (previous year: Euro 659.4m). "The like-for-like sales growth of 4.6 percent is especially pleasing. We have therefore latched seamlessly onto the dynamic sales performance seen in the previous two quarters and are yet again growing more rapidly than the sector", commented Albrecht Hornbach, Chairman of the Board of Management of HORNBACH HOLDING AG. Disproportionate earnings growth excluding one-off items "In its core retail business, the HORNBACH Group has shown a very pleasing performance on an operating level", stressed Albrecht Hornbach. In spite of the marked increase in pre-opening expenses, operating earnings (EBIT) in the retail segment of the HORNBACH-Baumarkt-AG subgroup improved by 2.1 percent. However, one-off non-operating items meant that overall earnings figures fell short of the equivalent figures for the previous year. The operating earnings (EBIT) of the overall Group amounted to Euro 38.8 million, compared with Euro 46.3 million in the first quarter of the previous year. This decline is solely due to one-off non-operating charges of Euro 7.8 million in the real estate segment. Whereas disposal profits of Euro 6.0 million had been generated on the sale of real estate in the previous year, no real estate was sold during the period under report. Moreover, the Group reported extraordinary depreciation and incurred losses on the disposal of an investment project not subject to further development. Not only that, increased costs of Euro 3.3 million due to the three new store openings also left their mark. These so-called pre-opening expenses were thus Euro 2.4 million higher than in the first quarter of the previous year, in which no new stores were opened. "Excluding the one-off items relating to the sale of real estate and pre-opening expenses, the overall Group generated disproportionate earnings growth": The non-operating items meant that the decline in EBIT was accompanied by a reduction in the other key earnings figures. Earnings before interest, taxes, depreciation and amortization (EBITDA) amounted to Euro 58.0 million at HORNBACH HOLDING AG, compared with Euro 65.0 million in the first quarter of 2006/2007. Earnings before taxes amounted to Euro 30.6 million, as against Euro 37.2 million in the same period in the previous year. A reduced tax rate meant that consolidated net income has shown only a slight decline - from Euro 22.6 million in the first quarter of the previous year to Euro 21.4 million. Marked increase in investment The increased pace of expansion is also reflected in the Group's investments. HORNBACH invested a total of Euro 68.8 million in the first quarter, mainly in land and buildings (75 percent), compared with a mere Euro 17.1 million in the first quarter of the previous year. The total workforce of the HORNBACH Group has risen over the past year from 12,082 to 12,587 employees (as of May 31, 2007). New store opening planned in Olomouc/Czech Republic Following the opening of the first HORNBACH DIY megastore with a garden center in Bucharest in June, one further new store opening is scheduled to take place in the Czech town of Olomouc before the end of the current financial year on February 29, 2008. "In the coming 2008/2009 financial year, we will then further step up the speed of our expansion and open up to nine new DIY megastores with garden centers in Germany and abroad", announced company boss Albrecht Hornbach. The most important key figures can be found in the following tables. The extensive interim reports of HORNBACH HOLDING AG and HORNBACH-Baumarkt-AG have been published in the Investor Relations section of the internet pages of the HORNBACH Group at www.hornbach-group.com. Key Figures at a Glance HORNBACH HOLDING AG Group Key Figures of the HORNBACH HOLDING AG 1st Quarter 1st Quarter Change Group (in ¤ million, unless otherwise 2007/2008 2006/2007 in % stated) Net sales 732.7 696.7 5.2 of which in other European countries 260.7 234.2 11.3 Gross margin (as % of net sales) 36.0% 35.6% EBITDA 58.0 65.0 -10.7 Earnings before interest and taxes (EBIT) 38.8 46.3 -16.2 Consolidated earnings before taxes 30.6 37.2 -17.7 Consolidated net income 21.4 22.6 -4.9 Basic earnings per preference share (¤) 2.18 2.29 -4.8 No. of employees 12,587 12,082 4.2 Investments 68.8 17.1 302.3 Total assets 1,966.5 1,862.7 5.6 Shareholders' equity 652.9 582.2 12.1 Shareholders' equity as % of total assets 33.2% 31.3% HORNBACH-Baumarkt-AG Group Key Figures of the 1st Quarter 1st Quarter Change HORNBACH-Baumarkt-AG Subgroup (in ¤ million, unless otherwise 2007/2008 2006/2007 in % stated) Net sales 696.0 659.4 5.6 of which in other European countries 260.7 234.2 11.3 Like-for-like sales growth 4.6% 1.4% Gross margin (as % of net sales) 36.5% 36.2% EBITDA 48.6 55.8 -12.9 Earnings before interest and taxes (EBIT) 32.4 40.9 -20.7 Consolidated earnings before taxes 27.3 35.0 -22.0 Consolidated net income 19.5 21.8 -10.3 Basic earnings per share (¤) 1.26 1.43 - No. of employees 12,005 11,509 4.3 Investments 23.3 11.4 104.4 Total assets 1,410.7 1,353.5 4.2 Shareholders' equity 491.8 437.7 12.4 Shareholders' equity as % of total assets 34.9% 32.3% No. of stores 123 122 0.8 Sales area as per BHB (in 000 m²) 1,351 1,312 3.0 Average store size (in m²) 10,981 10,755 2.1 Rounding up or down may lead to discrepancies between totals and percentages. About HORNBACH The HORNBACH Group is one of Europe's largest operators of DIY megastores with garden centers. In addition to the largest operating subgroup, HORNBACH-Baumarkt-AG (DIY megastores with garden centers), the overall HORNBACH HOLDING AG Group also comprises the subgroups of HORNBACH Baustoff Union GmbH (regional builders' merchant and construction materials business) and HORNBACH Immobilien AG (real estate and location development). The HORNBACH DIY megastores with garden centers have an average size of almost 11,000 square meters, a figure unmatched by any other competitor in Europe. Founded in 1877, the family-run company, which has its roots in the Palatinate region, was first publicly listed in 1987. HORNBACH currently operates 124 DIY megastores with garden centers in nine countries, of which 91 are in Germany. The other countries are Austria, the Netherlands, the Czech Republic, Switzerland, Sweden, Slovakia, Luxembourg and, since June 2007, Rumania. HORNBACH's sales concept and product range are entirely tailored to the needs of project and professional customers. HORNBACH guarantees its customers permanently low prices and is thus the price leader in the sector. The high quality of advice and excellent service provided by the company have been attested in numerous independent tests and studies. In the past year, HORNBACH was also awarded the "Management Achievement of the Year 2006" German Retail Prize by the Association of German Retailers. Pioneering achievements, such as the first combined DIY store with a garden center (1968), the first megastore (1980) and the first DIY store with a drive-in facility (2003), provide proof of HORNBACH's ongoing innovative power. Since 2001, a strategic partnership has been in place with the British retail group Kingfisher. HORNBACH has acted as "job machine" for decades, with more than 12,000 employees now participating in the success of the company. HORNBACH HOLDING AG generated sales of more than Euro 2.5 billion and operating earnings (EBIT) of Euro 119 million in the 2006/2007 financial year, which ended on February 28, 2007. By 2016, the HORNBACH Group aims to double its sales to Euro 5 billion. --- End of Message --- HORNBACH HOLDING AG Le Quartier Hornbach 19 Neustadt an den Weinstraße Germany WKN: 608343; ISIN: DE0006083439 ; Index: CDAX, Prime All Share, SDAX; Listed: Prime Standard in Frankfurter Wertpapierbörse, Amtlicher Markt in Frankfurter Wertpapierbörse;