TAKKT AG firmly on growth track

Management lifts turnover forecast for 2006

TAKKT AG has recorded good growth in the first half-year 2006. The leading B2B mail order group for business equipment in Europe and North America generated a turnover of EUR 471.6 (H1 2005: 377.5) million. This marks an increase of 24.9 percent against the same period last year. Adjusted for effects of the NBF acquisition and currency changes the increase was 9.2 percent. Earnings have also developed positively: EBITDA was up by 16.9 percent to EUR 58.0 (49.6) million. Cash flow set a new record with EUR 38.8 (33.2) million.

“The good figures for the first six months of the year impressively document the success of our business model and highlight that TAKKT is firmly on the growth track”, comments Georg Gayer, CEO of TAKKT AG. “Management is very optimistic for the full year 2006 and has therefore raised its turnover forecast. We are now expecting currency-adjusted top-line growth of about 20 percent.”

Operative profit EBITDA increases 16.9 percent
EBITDA, earnings before interest, tax, depreciation and amortisation, was up by 16.9 percent to EUR 58.0 (49.6) million. The EBITDA margin however fell from 13.1 to 12.3 percent. This can mainly be attributed to the first-time consolidation of National Business Furniture (NBF) Group. In January 2006, TAKKT took over the US market leader for office furniture mail order. As expected NBF is generating up to now below-average EBITDA margins. Excluding the NBF Group, the EBITDA margin is at previous year's level with 13.2 percent.

Liabilities increased as a result of the NBF acquisition. This is the main reason for higher interest expenses. Despite that profit before tax increased significantly to EUR 45.0 (39.9) million, which corresponds to a growth of 12.8 percent. Cash flow, calculated as profits before minority interest plus depreciation and deferred taxes, reached a new record at EUR 38.8 (33.2) million. The margin was 8.2 (8.8) percent.   

“We are very pleased with the results of the first six months”, explains Dr Florian Funck, CFO of TAKKT AG. “For the full year 2006, we are expecting the EBITDA margin to be at the top end of our target corridor of ten to twelve percent, despite the first-time consolidation of NBF Group as well as the planned start-up expenses for newly founded companies.”  

KAISER + KRAFT EUROPA increases profitability 
Turnover at KAISER + KRAFT EUROPA was up 10.5 percent to EUR 219.5 (198.7) million against the previous year on the back of the positive economic climate. Good growth rates were recorded in almost all countries, especially in Japan, Eastern Europe, Scandinavia, Spain and Switzerland. Business development at the new companies in China and France as well as at young companies in Turkey and Romania exceeded expectations.  

Despite anticipated start-up expenses for newly founded companies, the EBITDA of KAISER + KRAFT EUROPA increased overproportionately by 13.2 percent to EUR 41.2 (36.4) million, which corresponds to an EBITDA margin of 18.8 (18.3) percent. 

Topdeq's earnings develop positively
The division Topdeq also developed well in the first half-year. Turnover was up by 5.3 percent to EUR 41.7 (39.6) million. At unchanged exchange rates the increase in turnover would have been 4.3 percent. All companies with the exception of Topdeq Germany contributed to this growth, where higher order values were not able to fully compensate for falling order numbers as a consequence of the repositioning of Topdeq as a premium brand. Business at the new company in Belgium is extremely satisfactory and order intake clearly exceeds expectations.

The earnings development of the division continues to be positive. EBITDA was up by 33.3 percent to EUR 1.6 (1.2) million, with an EBITDA margin of 3.8 (3.0) percent. 

Very positive increase in turnover recorded at K + K America
K + K America was able to increase turnover against the previous year by 44.7 percent to USD 258.5 (178.6) million amid a stable economic development in North America. Excluding the NBF acquisition turnover in USD was up 9.4 percent. Translated into the reporting currency of euro turnover was up by 51.1 percent to EUR 210.4 (139.2) million. 

Hubert in the USA and C&H in Mexico continued to develop extremely well. Integrating the NBF Group is within plan and business development in the first half-year exceeded the expectations of the TAKKT management.   

The division K + K America was also able to improve its EBITDA considerably and reported EUR 20.1 (16.1) million, a figure which is 24.8 percent above the previous year. As anticipated the EBITDA margin slipped from 11.6 to 9.6 percent. This is mainly due to consolidating the NBF Group.  

Another award for investor relations work 
TAKKT AG has again been commended by reputed German business magazine “Capital” for its excellent investor relations work. As in the previous year, TAKKT came third in the SDAX segment at the renowned IR award. In the overall ranking of 196 German and European companies from the EUROSTOXX 50, DAX, MDAX, TecDax and SDAX the Group came in a very respectable 10th place. This success underpins the excellent IR work of TAKKT. Their objective is to provide different capital market addressees with information about the business development and prospects for TAKKT in a continuing, transparent, timely and comprehensive manner.

IFRS figures of TAKKT AG for H1 2006

Conference call
We would like to invite you to put questions personally to our Management Board. A telephone conference is arranged for 3 August 2006 at 3:00 pm (CEST) in which we will be delighted to answer your questions. Please dial in on +49 30 20223191.

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 areas business and warehouse equipment, traditional and design-oriented office furniture and accessories, occupational safety products and 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 two million customers worldwide and distributes more than 65 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, 3 August 2006

Contacts:

Georg Gayer, CEO
Phone +49 711 34658-201

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