NSG Group Half Year Results Announced

17 November 2008
The NSG Group has announced results for the first half of FY09 (six months ending 30 September 2008). Group CEO Stuart Chambers said ‘The figures are in line with our previous forecast. We continue to make progress on our strategic objectives, with net debt reduced further, to 304 billion yen, and ahead of schedule’. He added, that ‘deteriorating conditions in most of the markets in which we operate have required the Group to reduce its forecast for the FY09 full year’.

Stuart Chambers and Mike Powell presented the figures at a meeting attended by 200 analysts in Tokyo on 14 November. Stuart said, ‘these results reflect a solid first quarter performance, but with some weakening in the second quarter. External costs, particularly of energy and commodities, contributed to a reduction in our margins over the period and this has continued into the second half of the financial year’.

‘In the coming year, we expect to face tough conditions in most of our markets. These half-year results show progress, but we anticipate that sales and profits will decline further in the second half of the financial year, remaining at similar levels through the following financial year. These deteriorating conditions in most of our markets have required us to reduce our official forecast for the FY09 full year’

He highlighted the dramatic drop in vehicle sales around the world, which is requiring suppliers to cut production in line with falling customer demand. In Building Products, sales and profitability have been impacted by depressed activity in the construction sector, particularly in Europe.

‘Despite all this, we expect to continue to make further progress on our strategic objectives. Our key target is to ensure that our debt is below 350 billion yen at the end of March 2010. There are good reasons for believing that we will not only weather the current storm, but also move ahead in Phase 2 of our journey, which starts in about 18 month’s time’.

The analysts meeting included a presentation on the Solar Energy business and prospects for the NSG Group within it. Stuart said ‘we have a sound technological base and have already identified some very exciting new areas in which we can develop, and which will help us to compensate for reduced profits in the existing businesses. Solar Energy is an important part of the mix. We have established a new business unit to exploit this area and we are already converting some of our plants to meet the expected demand’.

Key Features

NSG Group Results for 6 months to 30 September 2008

· Results in line with previous forecast

· Group Net Sales

431 billion yen (€2,660 million)[i]

Down 1%

· Group Operating Income (profit)

29 billion yen[ii] (€178 million)

Down 26%

· Income (profit) before tax

48.1 billion yen (€297 million)

Down 27%

· Net Income (profit)

27.3 billion yen (€168 million)

Down 47%

· Net income per share

40.83 yen (25 euro cents)

[i] Euro equivalents approximate for illustration only

[ii] Before amortisation