Sto AG, Stühlingen Consolidated interim management report on the first three months of 2012 in accordance with Section 37x of the German Securities Trading Act (WpHG) At a glance: Sto consolidated turnover up by 4.7% to EUR 187.0 million in the first three months of 2012 Growth in foreign business Usual Q1 shortfall higher than usual (as expected) Group's workforce increases from 4,412 to 4,670 employees Outlook for 2012 as a whole unchanged: moderate rise in consolidated turnover and declining EBIT anticipated Industry environment Regional discrepancies in the development of the international building industry continued into 2012. Despite the restrictive measures put in place by its government, demand continued to grow in China. The situation in the US building sector appears to have stabilised at a low level. Development in Europe remained sluggish in the opening months of 2012. Business continued to suffer the adverse effects of the sovereign debt crisis in Southern and Eastern European countries in particular. By contrast, the markets in Northern and Western Europe largely showed signs of growth. However, this growth was modest in most cases due to unfavourable weather conditions. All in all, the German building industry got off to a good start in 2012. As disclosed by the German Federal Statistical Office, total turnover increased by 3.8% to EUR 8.7 billion in 1
the opening months of 2012 despite lagging sales in February as a result of poor weather conditions. The rise in construction orders by 12.4% in total shows that the basic trend remains a positive one. The number of building construction orders grew by 9% in January and February. According to the German Construction Industry Federation, demand remained high in the residential and public construction sectors in particular. However, the federation also reported that sales in the commercial construction sector were disappointing. Rise in consolidated turnover Sto AG saw consolidated turnover grow by 4.7% in the first quarter of 2012 compared to the same period last year to EUR 187.0 million. This growth was driven by foreign business, which rose by 10.5% to EUR 106.9 million. The consolidation of STOMIX, the Czech manufacturer and direct distributor of external wall insulation systems that was acquired in July 2011, made a small contribution to this increase in turnover. The percentage of Group turnover generated abroad was 57.2% compared to 54.1% in the first three months of 2011. At EUR 80.1 million, Sto's domestic turnover fell by 2.2%. This moderate decrease can be predominantly attributed to the deconsolidation of Inotec GmbH, after Deutsche Amphibolin-Werke of Robert Murjahn Stiftung & Co KG (DAW) took a 45% share in Inotec GmbH, Waldshut-Tiengen as part of a capital increase as previously reported. Sto AG has retained 45% of the shares in the joint venture company. The remaining 10% of the Inotec shares are owned by FAB Fördertechnik und Anlagenbau GmbH. The net effects of consolidation totalled EUR 0.4 million in the first quarter of 2012. Currency factors contributed EUR 1.8 million to Group turnover, which can mainly be attributed to amounts exchanged from the following currencies: Swiss franc, US dollar and Chinese renminbi. Excluding these effects, turnover grew by 3.5%. Business development in Germany remained sluggish in April 2012, which was also as a result of unfavourable weather conditions. Growth abroad continued at a steadier pace. 2
Result lower than in previous year Due to the distinct seasonal nature of the facade business, we do not generally generate a positive result in the opening months of any given fiscal year. The shortfall in the first quarter of 2012 was, as expected, higher than the previous year s figure for the same period. This was due to increased costs for raw material, personnel and logistics on the one hand, which had a very negative impact on earnings, and pressure from the competition on the other. Increased investment spending Investments in property, plant and equipment and intangible assets in the first quarter of 2012 amounted to EUR 4.9 million across the Group (previous year: EUR 2.3 million). The company's two major projects, namely the extension of the logistics centre in Weizen and the construction of the new sales centre in Vienna, were continued. Furthermore, funds were once again allocated to Retrofit measures, by means of which older production facilities at Sto AG are to be gradually brought into line with the latest technological standards. We will also make further substantial investments within the scope of this project over the course of the year. In addition to the usual replacement investments made by the company, the construction of a new headquarters in Belgium is also planned. Positive asset situation unchanged The asset situation of the Sto Group was unchanged as at 31 March 2012 and remains sound. Changes in individual balance sheet items compared to year end 2011 fell within normal expectations and largely reflected the typical run of business in the first quarter. Rise in workforce numbers As at the end of March, we employed 4,670 employees across the Group compared to 4,412 on the same day of the previous year. The 258 extra employees (+5.8%) resulted from the expansion of the foreign workforce by 283 employees to a total of 2,244 (+14.4%). Of these, 209 were employed by STOMIX companies and had not yet been 3
included in the previous year's value. A targeted approach was taken to reinforce other international Sto companies in line with our earnings-oriented growth strategy. A total of 2,426 employees were working for Sto in Germany at the end of the quarter compared to 2,451 employees a year ago. The reason for the loss of 25 employees was the deconsolidation of Inotec GmbH with an 86-strong workforce. We have also expanded our domestic workforce independently of this. The percentage of the Group's workforce employed abroad rose to 48.1% at the end of March 2012 (previous year: 44.4%). Outlook for 2012 as a whole unchanged Our outlook for 2012 as a whole remains unchanged and we anticipate that consolidated turnover will rise by approximately 3.5% to around EUR 1,145 million. At present, it is expected that this increase will result primarily from high demand in the America/Asia segment. Here we expect to see percentage growth in the mid single digit range. Forecasts indicate that the Western Europe segment will see slight percentage growth in the low single digit range. We anticipate that, in net terms, business in Northern/Eastern Europe will remain stable. However, this overall moderate growth in consolidated turnover will be accompanied by high increases in procurement, logistics and personnel costs throughout the year. This is the reason why, at present, consolidated earnings before interest and taxes (EBIT) are expected to be lower than the 2011 result of EUR 104.5 million. Stühlingen, May 2012 Executive Board 4
Key figures (in EUR million) Sto Group (IFRS) Q1 2011 Q1 2012 Difference Turnover 178.6 187.0 4.7 % - thereof in Germany 81.9 80.1-2.2 % - thereof outside Germany 96.7 106.9 10.5 % Investments (not including financial assets) 2.3 4.9 113.0 % Employees as at 31 March 4,412 4,670 5.8 % - thereof in Germany 2,451 2,426-1.0 % - thereof outside Germany 1,961 2,244 14.4 % 5