Interim report as per 30 September 2007

Quarterly figures confirm growth trend

KSB profited from the continued strength of the mechanical engineering sector in the first nine months of 2007. Global demand for pumps, valves and related systems was correspondingly buoyant. Towards the end of the quarter, however, order growth was much greater in the Americas and the Middle East than in the Group´s European domestic market and in Asia.

KSB Group

 

01-09/2007

01-09/2006

Change

Order intake

€ million

1,523.7

1,328.9

+ 14.7 %

Sales revenue

€ million

1,295.9

1,161.0

+ 11.6 %

Employees
(30 Sept.)

 

13,930

12,988

+ 7.3 %



Order intake and sales revenue development

Order intake in the Group increased by approximately €195 million year-on-year in the period from January to September 2007. This represents growth of 14.7 percent - to which the European Group companies made the largest contribution in terms of volume. However, KSB´s companies outside Europe achieved the highest percentage increases.

The Group´s three largest American companies in the USA and Brazil recorded high growth rates on the back of strong demand from the industrial and energy sectors, as well as from the mining industry. KSB´s companies in China, India and Pakistan exploited their excellent market positions to achieve strong growth as well.

The somewhat more restrained project business reported by the European companies impacted the strong overall order intake in the third quarter. The German parent company, KSB AG, improved its order intake by 8.1 percent in the first nine months, mainly due to orders from the industrial sector.

The consolidated sales revenue of the Group rose by approximately € 135 million or 11.6 percent as against the first three quarters of 2006. KSB AG recorded above-average sales revenue growth of 16.6 percent due to the invoicing of several major orders.

Another factor to be taken into account is the first-time consolidation of four operating KSB companies based in Belgium, Brazil, Dubai and Thailand as at 1 January 2007. Without these newly consolidated companies, the order intake would have risen by 12.8 percent and sales revenue by 10.1 percent.


Change in number of employees

KSB companies in all Regions recruited new staff in Sales, Production and Service to cope with the sharp increase in order volume. The increase in the headcount of 942 to 13,930 is also due to the inclusion of the four new Group companies, which employed a total of 368 people as at the reporting date of 30 September 2007.


Results of operations and financial position

The Group´s results of operations were again encouraging in the third quarter, with earnings before tax up significantly on the previous year. The Group´s financial position also remains very positive.

We are continuing to forecast a year-on-year improvement in consolidated earnings before tax for full-year 2007 (2006: € 90.2 million) and therefore an increase in the return on sales (2006: 5.6 percent). From today´s perspective, KSB AG will also exceed its prior-year earnings.

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