IFRS business figures for January 1 - September 30, 2005 - Dürr lays the groundwork for better profitability

11/10/2005

• Order intake higher than previous year's
• Gross margin improved by 3 percentage points
• Financial structure will improve considerably by year's end
• Implementation of FOCUS going according to plan

Despite a continuing difficult market environment, new orders for the Dürr Group rose in the first nine months of 2005 to € 1,177.4 million (previous year: € 1,139.1 million). At € 1,153.7 million, sales revenues were down 15 % compared with the previous year (€ 1,356.1 million), which had seen above-average sales revenues, however, due to one large order. Dürr improved its ratio of cost-of-sales to sales revenues significantly, with a gross margin of 19.5 % on average for the year to date (previous year: 16.5 %). This improvement is due to efficiency gains in project management and purchasing.

Operating earnings (EBITDA) from January through September 2005 amounted to € 41.4 million after € 45.4 million in the previous year's period and were influenced by earnings declines in plant engineering business. Net income/loss was € -4.6 million (previous year: € +3.3 million), which was influenced by higher interest expenses (€ 27.9 million; previous year: € 18.0 million). Including discontinuing operations net profit stood at € 6.6 million (previous year: € 2.3 million).

Net financial debt held more or less steady in the third quarter, at € 312.2 million (June 30, 2005: € 299.6 million). One reason for this development was that prepayments received were up € 10 million for the first time in several quarters.

Financial structure improves

In the framework of its strategic realignment, Dürr is concentrating on its core business with the automotive industry. Operations that do not fit in with core business are therefore being sold. With the proceeds Dürr improves its financial structure substantially. The company sold its Development Test Systems business unit for € 27 million in the third quarter. The sale of the Measuring and Process Technologies business unit to Hg Capital will bring Dürr € 205 million by the end of 2005, most of which will be used to reduce financial liabilities.

Implementation of FOCUS going according to plan

The operational strengthening of core business that Dürr has begun with the group-wide FOCUS program is well under way. As part of the restructuring of the Paint and Assembly Systems division, which will yield annual savings of € 50-60 million beginning in 2007, about 300 of the 800 job cuts that are planned worldwide were completed by the end of October. Restructuring has begun in the loss-bringing activities in the United States and Mexico. In addition, important organizational improvements were made, including establishing a uniform group-wide sales organization for key accounts, closer coordination of market development activities in painting technology for automobile manufacturers and their suppliers, and an international competence-center structure for large-scale plant engineering. Another current emphasis of FOCUS is product harmonization.

"The sale of Measuring and Process Technologies successfully concludes our disposal of peripheral activities. The proceeds give us the liquidity we need to concentrate entirely on strengthening operating earning power in our core business," said Ralf Dieter, who will take over as Chairman of the Board of Management of Dürr AG on January 1, 2006. Dieter continued, "We are benefiting from growth in the automotive industry in Asia and Eastern Europe as well as from a growing diversity of vehicle models, which requires flexible production systems. Moreover, our great expertise in technology and project management makes us a key partner for the increasingly important remodeling and optimization of existing automobile factories."

Outlook

For the full year 2005, Dürr expects sales revenues of around € 1.7 billion (previous year: € 1.9 billion) for its continuing operations including Measuring and Process Technologies and new orders on the previous year?s level of € 1.6 billion. Weak capacity utilization in plant engineering will weigh on earnings in the fourth quarter. With the proceeds from the sale of peripheral activities, Dürr expects to reduce net financial debt to about € 200 million by the end of the year. The equity ratio is expected to reach about 20 %.

The implemented FOCUS measures will find expression in a more favorable cost structure as early as 2006. Interest expense will decline significantly. Dürr expects to achieve a net profit for that year. After conclusion of the 18-month FOCUS program, the company expects to achieve a pre-tax margin of 4 % and an EBITDA margin of 8 % in 2007.

in € millions	Jan. 1 - Sept. 30, 2005	Jan. 1 - Sept. 30, 2004	Q3 2005	Q3 2004
Incoming orders	1,177.4	1,139.1	321.0	274.3
Orders on hand (as of Sept. 30)	950.8	1,053.9	950.8	1,053.9
Sales revenues	1,153.7	1,356.1	396.9	466.3
EBITDA	41.4	45.4	18.0	15.1
EBIT	22.6	28.2	11.7	9.3
Net income/loss for the period	-4.6	3.3	2.1	-1.3
Cash flow from operating activities	-131.1	-106.3	-28.3	-5.2
Cash flow from investing activities	94.5	-7.5	20.3	-6.7
Cash flow from financing activities	69.3	-4.9	44.5	27.1
Total assets (as of Sept. 30)	1,383.8	1,404.0	1,383.8	1,404.0
Equity (excl. minority interests) (as of Sept. 30)	243.7	227.8	243.7	227.8
Net financial debt (as of Sept. 30)	312.2	240.6	312.2	240.6
Net working capital (as of Sept. 30)	260.3	120.1	260.3	120.1
Employees as of Sept. 30	7,103	7,387	7,103	7,387

Please note: All figures are for the Dürr Group’s continuing operations unless otherwise provided. The Measuring and Process Technologies business unit is included in the figures for the first nine months of 2005. The Premier Group and the Development Test Systems business unit are no longer included.

The Dürr Group is one of the world's leading suppliers of products, systems, and services for automobile manufacturing. Its range of products and services covers important stages of vehicle production. As a systems supplier, Dürr plans and builds complete paint shops and final assembly facilities. Dürr also delivers cleaning and filtration systems for the manufacture of engine and transmission components as well as balancing systems for vehicle components.