Key figures of the TAKKT group remain at high level despite a decline in turnover

Economic recovery in North America made itself felt in the second quarter

The B-to-B mail-order company for office, business and warehouse equipment, which has over 2.4 million corporate customers world-wide, was able to partially offset the effects of the weak economy by its global presence and the growth contributed by new business start-ups. In the second quarter, the economic recovery continued especially in the USA. The TAKKT group's second-quarter profit before tax was up 21.3 percent on the same period of the previous year. Georg Gayer, chairman of the management board of TAKKT AG, remained cautiously optimistic about the full year 2002: "If the economic recovery in North America continues and the business climate in Europe improves in the second half of the year, our key figures for 2002 will be up on the previous year."

In the first half of 2002, the TAKKT group delivered a relatively good performance in a difficult economic environment that saw retailers' and manufacturers' turnover decline throughout the world. Turnover declined by 6.9 percent to EUR 399.1 (428.7) million and is in line with the expectations.

The developments of the individual local markets and companies varied. While the economic recovery in the USA, which started at the beginning of the year, continued, economic activity in Europe remained inconsistent.

Gratifying earnings performance despite lower turnover
The profitability of the TAKKT group remained stable at a high level. The gross profit margin increased to 40.1 (39.4) percent in the first half of the year. Apart from the lower volume of discount-carrying large-scale orders, this is also attributable to the expansion of the European warehouse business. At 10.7 (11.2) percent, the EBITDA margin stayed within the long-term target corridor of 10-12 percent and gives proof of the earnings stability of the TAKKT business model. EBIT amounted to EUR 28.2 (34.1) million, while profit before tax stood at EUR 18.9 (22.7) million. The cash flow reached EUR 25.9 (26.9) million.

"If we only look at the second quarter, all key figures generated higher margins than in the same quarter of the previous year", said Dr. Felix A. Zimmermann, board member for finance of TAKKT AG. "On the one hand, this is due to the positive development in the USA, on the other hand, it shows that we were able to align our cost structures to our turnover. Consequently TAKKT is well positioned to benefit in terms of earnings and cash flow once the economy recovers", Dr. Zimmerman continued.

KAISER + KRAFT EUROPA to expand to Asia
In the first half of 2002, KAISER + KRAFT EUROPA reported a 9.0 percent decline in turnover to EUR 183.9 (202.1) million, which accounted for 46.1 percent of total group sales. On a quarterly basis, turnover declined by 6.2 percent in the second quarter, compared to 11.5 percent in the first quarter. An EBITDA margin of 16.2 (16.5) percent means that the group's strong profitability remained unchanged.

In May 2002, the third KWESTO company offering a catalogue in the local language established a presence in Slovakia, thus expanding its market presence in Eastern Europe in line with the group's strategy to transfer the system business to other geographical markets.

The focus of the planned expansion to Asia will initially be on Japan. The expansion activities will be managed by KAISER + KRAFT EUROPA. In the beginning, a selected product range will be offered, which will gradually be expanded in line with market requirements. The operational start is scheduled for early 2003. Preparations for mailing the first catalogue are on time and budget.

Topdeq exceeds expectations in the USA
Topdeq's first-half turnover decreased by 2.2 percent to EUR 39.1 (40.0) million, which represents 9.8 percent of group sales. As expected, the EBITDA margin was increased to 2.8 (0.8) percent, especially thanks to reduced start-up costs for new companies compared to the previous year.

With customers placing an extremely large number of repeat orders, the US business exceeded the company's expectations, partially offsetting the disappointing performance of the German and Swiss companies.

Hubert with positive effect on North American activities
K + K America's first-half turnover declined by 5.6 percent to EUR 176.1 (186.6) million, accounting for 44.1 percent of group sales. A particularly gratifying performance was delivered by Hubert, the mail-order specialist for supplies and equipment for food service retailers, restaurants and hotel industry, which was acquired in 2000. Hubert reported positive growth rates in the second quarter of 2002, not least thanks to Canadian customers' excellent response to the Hubert catalogue.

The mail-order activities of C&H Distributors, Conney Safety Products and Avenue Industrial Supply showed some signs of recovery due to the positive economic development. Accordingly, K + K America's turnover was down only 0.2 percent on a USD basis.

Capital market welcomes TAKKT's adoption of IAS
Just like the report on the first three months of 2002, the interim report for the period ended 30 June 2002 was established to International Accounting Standards (IAS), which is in line with the requirements of Deutsche Börse. The capital market expressly welcomed this step. The explanations on the changeover as well as the explanations on the resulting differences posted on the Internet are considered to be exemplary.

Outlook on the full year
TAKKT is cautiously optimistic about the further course of fiscal 2002. The stable B-to-B mail-order business model ensures that turnover and earnings will directly benefit from an economic recovery. "Provided that an economic recovery materialises, especially in Europe, we expect the TAKKT group's key figures for the full year 2002 to improve on the previous year", said Georg Gayer to outline the company's perspectives. 

Stuttgart, 8 August, 2002

Contacts:

Georg Gayer
Phone +49 (0)7 11.50 01-239

Dr. Felix A. Zimmermann
Phone +49 (0)7 11.50 01-861