TAKKT AG continues internationalisation drive

Profitability increased yet again

“We have by far exceeded our targets for the financial year 2005.” This was the conclusion drawn by TAKKT CEO Georg Gayer at the Annual General Meeting held on 31 May. The leading B2B mail order company for business equipment increased its turnover by 6.3 percent and therefore exceeded its own expectations. Profitability was also increased.

Gayer highlighted that one key factor for the Group’s success was its focus on internationalisation. TAKKT AG started five new companies on three continents last year. Its presence in Shanghai is an important milestone. TAKKT is the first Western Group in B2B mail order to be granted a licence to sell office and business equipment throughout China. Gayer announced that TAKKT will continue to found new companies.

Success driven by new catalogue strategy   
Thanks to superior service levels and a new catalogue strategy TAKKT was able to expand its customer base in 2005. The number of orders was up, as were average order values. “Online orders are gaining significance and now account for more than nine percent of turnover”, Gayer explained at the Annual General Meeting. In 2005 TAKKT also optimised the catalogue strategy in the division KAISER + KRAFT EUROPA to strengthen and expand the traditional catalogue sales channel. Instead of mailing two catalogues a year the brand KAISER + KRAFT is now mailing three catalogues per year. “In addition to creating an additional purchase impulse we can place new products more quickly and can adjust prices to market conditions”, noted Gayer. 

Record profits and cash flow 
TAKKT generated its highest profit on record with EUR 50.4 (33.0) million. Equity increased substantially from EUR 181.1 to 230.6 million. The equity ratio was 46.1 (39.6) percent and total assets amounted to EUR 499.9 (457.8) million. TAKKT set up a new cash flow record with EUR 65.5 (60.5) million, higher than ever before. “We have used the cash flow to invest in further growth, to reduce our borrowings and to pay a significantly higher dividend to our shareholders as in the prior year”, Gayer noted.

Dividend proposal confirmed by large majority 
The Management and Supervisory Boards again proposed a dividend of 15 cent per share to ensure shareholders participated in the success of the company. The Annual General Meeting confirmed this with a large majority. “The considerable increase in the equity ratio will be used to fund the NBF acquisition and a possible further acquisition in 2006”, Gayer noted.  

New Management Board members
TAKKT aims to strengthen the individual divisions and pay tribute to the increasing internationalisation of TAKKT Group. Therefore the Supervisory Board appointed Didier Nulens to the Management Board with the responsibility for Topdeq and Thomas Loos to the Management Board with the responsibility for the K + K America Group. The new members have been appointed for three years. They both have long experience within the TAKKT Group. Currently they are responsible for the operative business of the respective divisions.

Alfred Milanello, CIO, is retiring. The Management Board of TAKKT AG now consists of the two newly appointed members – Belgian Didier Nulens and American Thomas Loos – as well as the already serving members, Swiss Franz Vogel (responsible for KAISER + KRAFT EUROPA), Dr Florian Funck (CFO) and Georg Gayer (CEO) from Germany.

Authorised capital renewed 
As was the case last year, the Annual General Meeting authorized the Management Board of TAKKT AG to buy up to ten percent of TAKKT shares on the capital market. This gives TAKKT AG financial leeway to buy companies, company shares or participations. 

Growth in new and existing markets  
In 2006, TAKKT AG will continue to roll out its business model into promising markets. After a successful start in China in February 2006, the first Gaerner France catalogue was mailed in May. September will see Topdeq starting operations in Austria as the third company. The Group intends to continue growing in existing markets by optimising its product range, offering high service levels and increasing its catalogue circulation. Georg Gayer sees great potential in Asia. Compared to other regions TAKKT is generating comparatively low turnover there up to now.     

Positive forecast for 2006  
Despite the unbalanced economic environment TAKKT’s CEO is very positive for the current financial year. The B2B mail order Group will grow by at least four to five percent in 2006, excluding the NBF acquisition and currency effects. All in all Georg Gayer is expecting turnover to increase by at least 18 percent. “We are planning an EBITDA margin at the top end of our target corridor, i.e. between 11.5 and twelve percent.”  

Actions of Management and Supervisory Boards ratified
The Annual General Meeting ratified the actions of the Management and Supervisory Boards. The Annual General Meeting also agreed to all other proposals made by the Management and Supervisory Boards on the agenda.     

Short profile of TAKKT AG  
TAKKT AG is the leading B2B mail order company for office, business and warehouse equipment in Europe and North America. The Group is represented in more than 25 countries with its brands. More than 100,000 products make up the product range of its subsidiaries and cover the following areas: business and warehouse equipment, traditional and design-oriented office furniture and accessories, occupational safety products, sales promotion articles for retailers as well as the food service and hotel market.   
  
TAKKT AG employs about 2,000 members of staff, has more than 2 million customers worldwide and distributes more than 55 million catalogues and mailings every year.  

The company is listed on the SDAX and was admitted to Deutsche Boerse’s Prime Standard on 1 January 2003.

Stuttgart, 31 May 2006

Contacts:

Georg Gayer, CEO
Phone +49 711 34658-201

Dr Florian Funck, CFO
Phone +49 711 34658-207