Hamburg, 28 April 2004. The wine trading group Hawesko Holding AG (HAW DE, HAWG.DE, DE0006042708) presented its financial statements for 2003 with the complete full year accounts as well as its three-month report for 2004 (for the period January to March) at today's annual results press conference in Hamburg. In the first three months of the current fiscal year, the Group increased its sales by 1% to Euro 64.5 million (previous year: Euro 63.8 million) as well as the operating result (EBIT) by 9% to Euro 1.8 million. Consolidated earnings after tax and minority interests declined due to non-cash financial expenditures by Euro 0.2 million to Euro 0.4 million. At the quarter's closing date of 31 March 2004 borrowings amounted to Euro 26 million, the lowest figure since 1999. In the first quarter of 2004, for the first time in the history of the company, a positive free cash flow was achieved for this quarter. This cash flow from current operations minus investments and interest paid amounted to over Euro 1.6 million.

The final year-end financial statements confirmed the already disclosed figures for 2003: despite the sustained economic slump and a 4% decline in the German wine market overall, Group sales rose by more than 4% to Euro 278.8 million, while the Group operating result (EBIT) rose proportionately higher, by 7%, to Euro15.1 million (previous year: Euro 14.1 million). Due to the significantly reduced financing expenditures, consolidated earnings after tax and minority interests also increased - by 34% to Euro 6.1 million (previous year: Euro 4.5 million). The earnings per share amounted to Euro 1.37 in 2003 (previous year: Euro 1.05). Due to the reduction in inventories, the balance sheet total declined by 6% to Euro 158.5 million. In 2003, free cash flow nearly doubled from Euro 8.9 million in the previous year to Euro 16.8 million, thus reaching the highest level ever posted by the Group.

Chief Executive Officer Alexander Margaritoff emphasised that the Hawesko Group had achieved growth as well as an increase in market share in 2003, despite the ongoing difficulties in the economy overall - which affected the situation in the wine sector as well as the general consumer climate.  Margaritoff went on to say that the world of wine had undergone some dramatic changes in the past several years, in that the worldwide production volume of high-quality wines had increased greatly, yet global demand had not kept up. In Germany, consumer restraint also played a role in the overall situation. Accordingly, large discounters and supermarkets had gained market share, while wines in the upper price categories had momentarily become significantly more difficult to sell. Thus on the one hand the more affordably priced offerings had introduced new customer groups to wine, while on the other hand the market was undergoing a shake-out. Hawesko viewed both of these events as opportunities. The Group was successful in defying the overall market trend at this time precisely because it had never lost sight of its long-term focus: the creation of successful route(s) to market, its powerful position in the market for premium wines, and its strong business and financial foundation.

Chief Financial Officer Sven Ohlzen used the full-year financial statements to show that the Hawesko Group succeeded in further strengthening this foundation in 2003: for instance, that the increased effectiveness of advertising measures or the increased efficiency of the delivery and logistics were reflected in the lower expenses posted under the corresponding items in the profit and loss statement. The intensive efforts over the last three years in working capital management also showed their positive influence in the balance sheet: since 2000, capital efficiency had steadily increased. Turnover of total assets in 2003 was 1.8 (previous year: 1.6), while borrowings had been reduced over the past three years by a total of more than Euro 25 million, and the equity ratio was increased to over 40%. Free cash flow had been positive for the last five years, and was maintained at a high level for the past three years. In 2003, Hawesko generated more than Euro 6 net in cash per Euro 100 in sales - a major prerequisite for consistently high dividends without eroding the assets of the company. "Financial strength," according to Ohlzen, "is one of the most important competitive advantages Hawesko has in such a difficult consumer environment as the present one."

In his outlook for 2004, Chief Executive Officer Alexander Margaritoff forecast another increase in sales and results with a consistently solid balance sheet for the Group. "Thus we will not only be able to weather the relatively dramatic changes in our market better than others - we will also be able to profit from them," said Margaritoff.  Over the longer term, he emphasised, the German wine market would play a significant role in the overall development of the world market for wine; with 11 million hectolitres, Germany is the largest wine importer in the world, ahead even of the United Kingdom and the United States. On the basis of its proven concepts, Hawesko would continue to build up its strong position in Germany - and at the appropriate time would also develop a similar position in the neighboring European countries.

Hawesko Holding AG is the leading supplier of premium wines and champagnes.  Its sales channels include mail order/e-commerce (particularly Hanseatisches Wein- und Sekt-Kontor), specialist wine-shop retail (Jacques' Wein-Depot) and wholesale (Wein Wolf und CWD Champagner & Wein Distributionsgesellschaft). The Group employed an average of 568 staff members during the past fiscal year. The shares of Hawesko Holding AG are listed on the Hanseatic Stock Exchange in Hamburg as well as in the SDAX segment of the Frankfurt Stock Exchange.

 

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The complete 2003 annual report and the three-month interim report are available online under http://www.hawesko.com, then click through "English" --> "Investor Relations" --> "Financial infos" --> "Financial reports".

 

Published by:
Hawesko Holding AG
Postfach 20 15 52
20205 Hamburg, Germany

Internet:
http://www.hawesko.com
(Company information)
http://www.hawesko.de  
(Online shop)
http://www.jacques.de   
(Locations and information about Jacques' Wein-Depot)

Press/Media:     
Vera Maria Bau,
VMB Consulting   
Tel.  +49 (0)228 4496 220    
Fax   +49 (0)228 4496 298    
E-mail:  vmb@nsag.de    

Investor Relations:
Thomas Hutchinson,
Hawesko Holding AG
Tel. +49 (0)40 30 39 21 00
Fax  +49 (0)40 39 21 05 05 
E-mail:  ir@hawesko.com