DJ DGAP-Adhoc: Loewe AG: Half-year figures for 2010 / Changes in the Executive Board

DJ DGAP-Adhoc: Loewe AG: Half-year figures for 2010 / Changes in the Executive Board

Loewe AG / Change in Forecast/Change of Personnel

29.07.2010 08:00

Dissemination of an Ad hoc announcement according to § 15 WpHG, transmitted by

DGAP - a company of EQUITYSTORY AG.

The issuer is solely responsible for the content of this announcement.

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- New forecast for 2010:

- Continued moderate growth in sales projected

- Negative EBIT for 2010 not ruled out due to higher

procurement costs

- Restructuring started

- Löhrer resigns on own volition

- Seidl assumes chairmanship of Executive Board

Kronach, July 29, 2010 - Sales of the Loewe Group in the second quarter of

2010, at EUR 74.0 million, were 4% higher than the 2009 figure of EUR 71.0

million. In the first six months of 2010, Group sales increased moderately

by 3% from EUR 143.8 million to EUR 147.4 million. While first half sales

in Germany at EUR 84.0 million equaled those of the previous year, export

sales grew by 5% to EUR 63.4 million. Despite this moderate increase in

sales volume, Loewe recorded an EBIT loss of EUR 4.9 million in the second

quarter of 2010 compared to positive EBIT of EUR 0.7 million in the same

period of 2009. For the first six months of 2010, EBIT amounts to a loss of

EUR 4.1 million, down from positive EBIT of EUR 1.4 million in H1 2009.

Price adjustments in the entry level TV segment and higher procurement

costs (especially for the LCD panels highly in demand), enabled Loewe to

achieve a gross margin of 22.9% in the first six months of 2010. This

amount is accordingly 4.8 percentage points lower than the high level of

27.7% in the 2009 period. Furthermore, problems with suppliers prevented

Loewe from launching the new Individual TV family in the key European

markets until the FIFA World Cup had already started.

Generally, the business associated with the FIFA World Cup in South Africa

fell short of Loewe's expectations. The departing Loewe CEO, Frieder C.

Löhrer, has accepted responsibility for the current business development

and requested the Supervisory Board to accept his resignation with

immediate effect. Loewe is responding to the changed market and framework

conditions with a restructuring program that has already been initiated in

cooperation with an external partner in order to make the company more

efficient for the future. Chief Financial Officer Oliver Seidl will assume

responsibility for the complete restructuring as CEO and will provisionally

be responsible for marketing and sales.

A purchasing offensive will result in improvements in earnings in the short

term through a review of purchasing conditions. For the medium and long

term, Loewe will use increased bundling of volume to key suppliers, the

systematic use of platform concepts and improved utilization of potentials

in Asian procurement markets to reduce cost of materials on the procurement

side on a sustained basis. Furthermore, the CENTRAL divisions of

development, marketing and sales are currently being restructured to ensure

more rapid availability of the products in the market and more EFFECTIVE

marketing of products. Generally, increased cost discipline is a priority

for Loewe across all divisions. All investments not having product,

distribution or brand relevance will come under scrutiny.

Loewe will intensify the LED product offensive already started by launching

the Individual 55 and 32 inch LCD TVs and two TV product lines with the

most advanced LED backlighting in the second half of 2010. Loewe will

present 3D-capable televisions and the first BluRay player for 3D

television at the most important trade show, IFA 2010. These two products

will then be launched on the market in the first quarter of 2011. Loewe

will also present user friendly solutions for connecting televisions to the

Internet based on the new HbbTV standard at the IFA.

The possibility of sustained weakness of the euro could also result in

future risks arising from the purchasing volume for flat panel displays,

which are for the most part settled in U.S. dollars. Accordingly, an

appreciation of the U.S. dollar in relation to the euro will lead to higher

procurement costs. Hedging instruments are used to hedge a defined

purchasing volume on a rolling basis for a period of about 18 months. From

the present perspective, however, it cannot be ruled out that the weakness

of the euro will have a negative IMPACT on the gross margin in the future.

Loewe continues to expect sales to grow moderately in the current fiscal

year 2010. Despite the positive stimuli expected from the International

Consumer Electronics Fair in Berlin, the launch of new, innovative home

entertainment solutions and the early initiation of the restructuring

program, it is impossible to rule out negative EBIT for 2010 as a whole

from the present perspective. This primarily results from currency and

procurement risks. Loewe anticipates slight sales growth and a positive

earnings trend for fiscal 2011. The company's sound CAPITAL structure and

multiyear financing agreements make it well positioned for the future.

Information and Explaination of the Issuer to this News:

ATTENTION PLEASE: In this connection Loewe is announcing a conference call

with Mr. Oliver Seidl, CEO, TODAY at 10:00h a.m. local time. Please

ir@loewe.de to receive the dial in details.

Loewe AG

Industriestrasse 11

96317 Kronach, Germany

Investor Relations, Axel Gentzsch

phone: +49 9261 99-240

fax: +49 9261 99-994

mail: axel.gentzsch@loewe.de

Public Relations, Dr. Roland Raithel

phone: +49 9261 99-217

fax: +49 9261 99-444

mail: roland.raithel@loewe.de

29.07.2010 Ad hoc announcement, Financial News and Press Release distributed by DGAP.

Media archive at www.dgap-medientreff.de and www.dgap.de

Language: English

Company: Loewe AG

Industriestrasse 11

96317 Kronach

Deutschland

Phone: +49 (0)9261 99-984

Fax: +49 (0)9261 99-994

E-mail: ir@loewe.de

Internet: www.loewe.de

ISIN: DE0006494107

WKN: 649410

Indices: SDAX

Listed: Regulierter Markt in Frankfurt (Prime Standard); Freiverkehr

in Berlin, Düsseldorf, München, Hamburg, Stuttgart

End of News DGAP News-Service

(END) Dow Jones Newswires

July 29, 2010 02:01 ET (06:01 GMT)

Quelle: DJ-Newswire