Interroll Group with encouraging performance in fiscal 2011

Order intake rose from CHF 285.2 million in 2010 to CHF 288.7 million at the end of 2011. Expressed in local currency, this corresponds to growth of 13%.

Having spiralled during the first half of 2011, commodity prices stabilised over the course of the second six months. To some extent, Interroll managed to offset this trend by adjusting its own market prices. Above all, however, additional productivity improvements proved decisive within this area.

Result
Earnings before interest, taxes, depreciation and amortisation (EBITDA) edged up by 1.3 % year on year, reaching CHF 36.2 million at the end of 2011 (2010: CHF 35.8 million); the EBITDA margin rose from 12.6 % to 13.3 %. Earnings before interest and taxes (EBIT) remained at CHF 20.4 million, while the EBIT margin rose from 7.2 % to 7.5 %. For the first time, the EBIT figure included amortisation relating to SAP, amounting to CHF 1.2 million for the second half of 2011. Profit for the year increased by a considerable 26.1 %, up from CHF 14.4 million to CHF 18.2 million.

Financial position
The financial position of the Interroll Group remains solid, as illustrated by the balance sheet figures for the year under review. At the end of 2011, equity amounted to CHF 143.3 million (end of 2010: CHF 127.5 million); the equity ratio stood at 59.9 % (end of 2010: 60.3 %). Investments totalled CHF 19.6 million in the reporting year. They included, primarily, the continued roll-out of an SAP project that is of particular strategic importance to the company, as well as final extension work on the Centre of Excellence for Conveyor Rollers in Wermelskirchen (D) and the renewal of production systems.

Current assets, increased on the back of revenue growth and as a result of the significant level of order backlog, and the investment projects were among the reasons for the rise in net debt (from CHF 12.9 to CHF 17.6 million). Cash flow from operating activities totalled CHF 14.5 million (2010: CHF 18.7 million).

Product group "Drives"
The Drives product group (motors and drives for conveyor systems) generated sales of CHF 95.1 million in the year under review (2010: CHF 97.9 million). Expressed in local currency, sales rose by 8.4 %. Order intake stood at CHF 98.0 million, compared to CHF 100.7 million in the previous year. The company's RollerDrive EC310 and Synchronous Drum Motor, both of which are new products featuring recently developed intelligent control units, continued to capture market share over the course of the reporting period. As sales volumes have shown, Interroll's RollerDrive EC310 meets the full range of market requirements. Designed for energy-efficient conveyor systems, the RollerDrive was even honoured with the 'MM Logistik Award' at the world's leading logistics trade fair CeMAT in Germany. What is more, the new control units used in conjunction with this product received the coveted iF Product Design Award 2011.

Product group "Rollers"
Sales generated by the Rollers product group grew from CHF 79.2 million in 2010 to CHF 83.2 in 2011. Expressed in local currency, sales significantly rose by 16 %. In parallel, order intake expanded year on year, from CHF 81.8 million to CHF 86.7 million. In Europe, Interroll saw Roller sales rise by 7 %, while the Asian market generated growth of 12.7 %. In the United States, meanwhile, the Group managed to secure a new contract as an outsourcing partner for the production of conveyor rollers. Interroll produces approx. 10 million conveyor rollers each year and is acknowledged as the world's leading manufacturer of specialist rollers. This is a tribute to Group investments of more than CHF 10 million at the Centre of Excellence in Wermelskirchen (D) over the last three years as well as the considerable market success of Interroll-engineered rollers.

Product group "Conveyors & Sorters"
Sales within the Conveyors & S orters product group stood at CHF 42.8 million at the end of the year under review (2010: CHF 52.1 million). At CHF 51.2 million, order intake was slightly up on the previous year's figure (2010: CHF 51.0 million); expressed in local currency, it grew by 12.4 %. Online trading has been identified as one of the key growth drivers for Sorters, as this area of business is dependent on efficient distribution centres for dispatch and returns handling. The newly established regional Centre of Excellence in China celebrated a major milestone in 2011. The very first Sorter assembled at the site is destined for the Chinese postal service. The subsidiaries in Korea and Brazil secured initial contracts for Sorters. Meanwhile, Singapore Post took delivery of an Interroll Sorter. Within the area of airport security, Interroll companies based in the US secured large-scale contracts for Intelliveyor conveyor modules designed to increase passenger throughput within the security zones. Interroll also acquired another conveyor system project within the security segment for newly established Berlin-Brandenburg Airport.

Product group "Pallet & Carton Flow"
The Pallet & Carton Flow product group generated sales of CHF 50.8 million in the financial year under review (2010: CHF 53.9 million). Expressed in local currency, sales rose by 4.3 %. Order intake totalled CHF 52.8 million, which corresponds to an increase of 13.2 % expressed in local currency. In Europe, business relating to Carton Flow products was close to the level recorded in 2008. Within this area, the company's new roller tracks for improved throughput of totes in picking racks captured a significant share of the market. Manufactured in Canada, Pallet Flow and Carton Flow products supplied to the US came under increased pressure as a result of the unfavourable exchange rate. In response, Interroll is currently assessing the possibility of relocating central production from Canada to the United States and retaining a production site in Canada to serve the local market. The dynamic storage contracts secured by Interroll in connection with projects at Red Bull and Procter & Gamble are to be seen as a solid foundation for future business development. With references such as these, the company looks set to benefit from growing demand for Interrollengineered material handling solutions among customers served by system integrators and plant manufacturers.

Regional overview
Interroll's overall performance in Europe was very successful in the period under review. Expressed in the currency of consolidation, the Interroll in Europe generated sales of CHF 181.4 million (2010: CHF 188.7 million), which represents 66.7 % of Group sales. Expressed in local currency, sales rose by 6.6 %. Order intake stood at CHF 198.8 million, compared to CHF 186.3 million in the previous year.

Expressed in the currency of consolidation, sales revenue in America totalled CHF 59.0 million (2010: CHF 64.5 million), which represents 21.9 % of Group sales. Expressed in local currency, this corresponds to growth of 5.9 %. The US market developed well over the course of the year. The fledgling Interroll company in South America moved forward at an encouraging pace, securing its first Sorter contract in the period under review.

Sales generated in Asia totalled CHF 31.5 million which corresponds to 11.4 % of Group sales. Interroll China supplied a large consignment of Belt Curves and produced its first Sorter for the Chinese postal service. With its new facility in Suzhou (to the west of Shanghai), Interroll China has now evolved into a regional Centre of Excellence for Asia/Pacific.

Distribution of reserves from capital contributions
In view of the financial stability of the company and the encouraging results achieved during the financial year now ended, the Board of Directors will propose to the Annual General Meeting of Shareholders on 11 May 2012 a distribution of CHF 7.00 per registered Interroll share (2011: CHF 5.00 per registered Interroll share) out of reserves from capital contributions. This distribution of reserves from capital contributions (in place of a dividend) is usually tax-exempt for shareholders.

Outlook
Despite a good start to the new year, with economic conditions remaining volatile Interroll is adopting a watchful approach to the immediate future. We do not expect the situation to fundamentally improve during the current financial year: foreign exchange fluctuations are likely to continue along with rising commodity prices in some areas and the prospect of political upheaval. Our newly reorganised corporate structure accords with our long-term growth strategy, helping further strengthen our market position and increase market share, as well as allowing us to leverage market opportunities more effectively. We will continue to expand our global network in a targeted manner and to forge ahead with our activities in the United States and Asia. Tight cost management, ongoing increases in productivity and a solid financial base are other priorities. We will proceed with strategic projects as planned. Other investment in innovative products offering real added value for customers is also envisaged and is aimed at securing the future of the business.

Contact
Interroll-Holding SA Zona Industriale 6592 San Antonino Tel. 091 850 25 25 Fax 091 850 25 55 info@interroll.ch

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