Roth & Rau AG / Key word(s): Preliminary Results07.11.2011 18:30Dissemination of an Ad hoc announcement according to § 15 WpHG, transmittedby DGAP - a company of EquityStory AG.The issuer is solely responsible for the content of this announcement.---------------------------------------------------------------------------Roth & Rau AG: Difficult market climate and one-off items weigh onquarterly earningsHohenstein-Ernstthal, 7 November 2011 - The marked deterioration in thesolar energy market climate in recent months has impacted significantly onoperations and key earnings figures at Roth & Rau AG. Based on preliminaryfigures, consolidated sales for the first nine months of 2011 amounted toEUR 146 million (2010: EUR 189.2 million), while earnings before interestand taxes (EBIT) amounted to EUR -76 million (2010: EUR 3.0 million).One-off items of EUR 58 million represent the prime cause of these highlynegative earnings figures for the current financial year to date.In the first half of the year, Roth & Rau AG had still expected the marketto stabilise at a low level. However, the uncertainty surrounding thefuture structure of solar promotion programmes in key European markets inthe third quarter led to a further drastic decline in demand for solarmodules and systems. In conjunction with existing surplus market capacity,numerous international cell and module manufacturers have substantially cutback their production capacities. Furthermore, financing terms for newsolar projects have deteriorated significantly on account of increasedglobal economic risk and uncertainty on the financial markets, as a resultof which companies have postponed or even cancelled planned capacityexpansion investments.Against this backdrop, it was not possible to complete most of the projectscurrently underway in the third quarter of 2011 on schedule, as severalcustomers delayed final acceptance of the products. This impacted on thecompany's sales and earnings strength. It was also not possible toimplement the sale of inventories budgeted for the third quarter in the wayoriginally planned, thus leading to impairment requirements. A furtherconsequence of the market turbulence is that the creditworthiness ofseveral customers has deteriorated significantly, as a result of which Roth& Rau has been obliged to review and adjust the value of individualreceivables. Based on preliminary figures, consolidated sales amounted toEUR 54 million in the third quarter of 2011, thus falling 24% short of theprevious year's figure (2010: EUR 70.4 million). Preliminary EBIT, whichamounted to EUR -52 million, was negatively affected by one-off items ofEUR 45 million. This figure includes write-downs of trade receivables andinventories, as well as provisions for contractual risks and structuralmeasures to be implemented. Furthermore, it was necessary to postimpairments of intangible assets.The Management Board cannot exclude the possibility of further earningsrisks arising in the current fourth quarter. These could lead to additionalone-off items of around EUR 15 million.Countermeasures already in implementation Roth & Rau has already reacted to the significant downturn in demand andintroduced short working hours in its production divisions, initially for alimited period of half a year. This means that the company will be able torespond flexibly, and at short notice if need be, to any potential recoveryin its customers' willingness to invest.The CRiSP cost and structure optimisation programme is now under review bythe new Management Board at Roth & Rau AG, with its main components beingmaintained and accelerated. The programme was introduced with the aim ofcreating more flexible long-term cost and organisational structures toenhance the company's ability to cushion increasingly frequent fluctuationsin demand in the solar industry.Roth & Rau AG will be publishing its detailed interim report as of 30September 2011 on 15 November 2011.Contact:Roth & Rau AGProf. Dr. Silvia RothTel.: +49 (0) 3723/671-3333E-mail: investor@roth-rau.de07.11.2011 DGAP's Distribution Services include Regulatory Announcements,Financial/Corporate News and Press Releases.Media archive at www.dgap-medientreff.de and www.dgap.de--------------------------------------------------------------------------- Language: EnglishCompany: Roth & Rau AG An der Baumschule 6-8 09337 Hohenstein-Ernstthal GermanyPhone: 03723 6685-0Fax: 03723 6685-100E-mail: info@roth-rau.deInternet: www.roth-rau.deISIN: DE000A0JCZ51WKN: A0JCZ5Listed: Regulierter Markt in Frankfurt (Prime Standard); Freiverkehr in Berlin, Düsseldorf, München, Stuttgart End of Announcement DGAP News-Service ---------------------------------------------------------------------------
