The full report is accessible via the Internet at:
http://www.flsmidth.com/f.l.smidth/English/Investor+Relations/Reports/default.htm
The main conclusions are as follows:
FLS Group overall
- Earnings before tax (EBT) amounted to DKK 202m as against DKK -717m for the same period last year.
- The FLS Group's total earnings before interest and tax (EBIT) were DKK -353m as against DKK -123m for the same period last year.
- Cash flow from operating activities were DKK -54m as against DKK 771m compared to the same period last year. Cash flow from operating activities for the first half-year 2003 were expected to be significantly below last year's level. However, due mainly to the development in FLS miljø, cash flow from operating activities were lower than anticipated.
- The FLS Group's interest-bearing debt amounted to DKK 2.0bn by the end of the first half-year 2003 (end of first half-year 2002: DKK 3.6bn).
- The strategic plans announced on 29 August 2002 are being followed. As previously announced, the transition period is expected to run until the end of 2003.
- On 1 January 2004, CEO Jørgen Huno Rasmussen will take up the post of Group President and CEO of the FLS Group.
Core activities
- The FLS Group's core activities organised within F.L.Smidth Group and FLS Building Materials posted total earnings before interest and tax (EBIT) of DKK 3m, (DKK 190m in the first half-year 2002). Net of one-off items, the EBIT result of FLS Building Materials was an improvement on last year. F.L.Smidth's earnings before interest and tax (EBIT) were down DKK 161 on the same period last year.
- The F.L.Smidth Group was successful in receiving orders of DKK 4.9bn (DKK4.1bn), the highest level ever, and expects an increase in the market for newly contracted production capacity in 2003. Total turnover within the core activities reached DKK 5.3bn (DKK 5.3bn), F.L.Smidth Group accounting for DKK 3.55bn (DKK 3.35bn) and FLS Building Materials DKK 1.75bn (DKK 1.91bn).
- The core activities recorded a positive cash flow from operating activities of DKK 360m as against DKK 281m for the same period last year.
Other activities
- FLS Aerospace posted negative earnings before interest and tax of DKK 23m in the first six months of the year - an improvement on the same period in 2002 (DKK -27m).
- FLS miljø is proceeding with the completion of a desulphurisation project in the UK. Increasing costs of completion for this project resulted in a total operating loss of DKK 325m (DKK -223m).
Prospects for the overall FLS Group in 2003
- The FLS Group anticipates a consolidated turnover of just over DKK 15bn, provided that its main currencies USD and GBP remain at the current exchange rate level. The previous expectation was about DKK 15bn.
- The FLS Group now expects earnings before interest and tax (EBIT) around the level of DKK -50m to DKK -100m as against the previous expectation of DKK 300m to 400m.
- Earnings before tax (EBT) are now expected to be around the level of DKK -200m to DKK
-250m, exclusive of the effect of acquisition and disposal of undertakings, against the previously anticipated DKK 250m to 350m.
Prospects for the individual activities in 2003
- The F.L.Smidth Group and FLS Building Materials' core activities downgrade expectations for the EBIT result from around DKK 0.5bn to around DKK 0.4bn.
- FLS Aerospace maintains its expectations for the year, whereas FLS miljø lowers its expectations. These activities combined with the costs of the parent company are expected to have a DKK 0.5bn adverse effect on the EBIT result.
- The earnings forecast is still subject to uncertainty with regard to the prospects of the non-strategic activities. The Group's focusing strategy will be implemented, inter alia, through a number of corporate divestments. The results, the sequence and the timing of these divestments may significantly influence the prospects, negatively and positively, and have not been included in the above figures.
FLS Industries A/S
Corporate Public Relations
The main conclusions are as follows:
FLS Group overall
- Earnings before tax (EBT) amounted to DKK 202m as against DKK -717m for the same period last year.
- The FLS Group's total earnings before interest and tax (EBIT) were DKK -353m as against DKK -123m for the same period last year.
- Cash flow from operating activities were DKK -54m as against DKK 771m compared to the same period last year. Cash flow from operating activities for the first half-year 2003 were expected to be significantly below last year's level. However, due mainly to the development in FLS miljø, cash flow from operating activities were lower than anticipated.
- The FLS Group's interest-bearing debt amounted to DKK 2.0bn by the end of the first half-year 2003 (end of first half-year 2002: DKK 3.6bn).
- The strategic plans announced on 29 August 2002 are being followed. As previously announced, the transition period is expected to run until the end of 2003.
- On 1 January 2004, CEO Jørgen Huno Rasmussen will take up the post of Group President and CEO of the FLS Group.
Core activities
- The FLS Group's core activities organised within F.L.Smidth Group and FLS Building Materials posted total earnings before interest and tax (EBIT) of DKK 3m, (DKK 190m in the first half-year 2002). Net of one-off items, the EBIT result of FLS Building Materials was an improvement on last year. F.L.Smidth's earnings before interest and tax (EBIT) were down DKK 161 on the same period last year.
- The F.L.Smidth Group was successful in receiving orders of DKK 4.9bn (DKK4.1bn), the highest level ever, and expects an increase in the market for newly contracted production capacity in 2003. Total turnover within the core activities reached DKK 5.3bn (DKK 5.3bn), F.L.Smidth Group accounting for DKK 3.55bn (DKK 3.35bn) and FLS Building Materials DKK 1.75bn (DKK 1.91bn).
- The core activities recorded a positive cash flow from operating activities of DKK 360m as against DKK 281m for the same period last year.
Other activities
- FLS Aerospace posted negative earnings before interest and tax of DKK 23m in the first six months of the year - an improvement on the same period in 2002 (DKK -27m).
- FLS miljø is proceeding with the completion of a desulphurisation project in the UK. Increasing costs of completion for this project resulted in a total operating loss of DKK 325m (DKK -223m).
Prospects for the overall FLS Group in 2003
- The FLS Group anticipates a consolidated turnover of just over DKK 15bn, provided that its main currencies USD and GBP remain at the current exchange rate level. The previous expectation was about DKK 15bn.
- The FLS Group now expects earnings before interest and tax (EBIT) around the level of DKK -50m to DKK -100m as against the previous expectation of DKK 300m to 400m.
- Earnings before tax (EBT) are now expected to be around the level of DKK -200m to DKK
-250m, exclusive of the effect of acquisition and disposal of undertakings, against the previously anticipated DKK 250m to 350m.
Prospects for the individual activities in 2003
- The F.L.Smidth Group and FLS Building Materials' core activities downgrade expectations for the EBIT result from around DKK 0.5bn to around DKK 0.4bn.
- FLS Aerospace maintains its expectations for the year, whereas FLS miljø lowers its expectations. These activities combined with the costs of the parent company are expected to have a DKK 0.5bn adverse effect on the EBIT result.
- The earnings forecast is still subject to uncertainty with regard to the prospects of the non-strategic activities. The Group's focusing strategy will be implemented, inter alia, through a number of corporate divestments. The results, the sequence and the timing of these divestments may significantly influence the prospects, negatively and positively, and have not been included in the above figures.
FLS Industries A/S
Corporate Public Relations