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Wienerberger AG (0GIK)

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Friday 06 November, 2009

Wienerberger AG

Wienerberger records clearly positive cash flow...



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-    Revenues -26% to ¤ 1,416.7 million; operating EBITDA -51% to ¤
177.5 million
-    Cost savings of ¤ 135 million realized during the first nine
months
-    Inventories reduced by more than ¤ 100 million
-    Free cash flow totals ¤ 110 million
-    Net debt declines to ¤ 540 million

Vienna, November 6, 2009 - Wienerberger AG, the world's largest
producer of bricks, was impacted by the continuing effects of the
global economic and financial crisis during the first nine months of
this year. Bank constraints on project financing for housing and
above all the decline in consumer confidence triggered a sharp drop
in new residential construction. Against this backdrop, Wienerberger
recorded a 26% decrease in revenues to ¤ 1,416.7 million and 51%
lower operating EBITDA of ¤ 177.5 million (before restructuring
costs) and a drop in operating EBIT of 83% to ¤ 36.7 million. Due to
restructuring costs of ¤ 81.4 million (comprising ¤ 29.3 million of
cash expenses and ¤ 52.1 million of special write-downs) as well as
the half-year recognition of ¤ 28.2 million in impairment charges to
property, plant and equipment and also, of ¤ 124.4 million to
goodwill profit before tax was clearly negative at ¤ -225.3 million.
Profit after tax totaled ¤ -198.2 million as a result of positive tax
effects, and adjusted earnings per share equaled ¤ -0.01.

Liquidity remains top priority

"The year got off to a weak start in all our markets. Sales volumes
fell dramatically, especially in Central-East Europe and North
America, and new residential construction continued to contract
across Western Europe - above all in Great Britain, the Netherlands
and France" explained Heimo Scheuch, Chief Executive Officer of
Wienerberger AG, the developments in the challenging operating
environment." An analysis by quarter shows a slower decline in
revenues over the course of the year: the third quarter decrease was
slightly smaller than the decrease in the second quarter, partly
because of the lower comparative values for the third quarter of the
previous year. "Although volume declines were more moderate during
the summer, September remained below expectations - especially in the
USA and Eastern Europe - and there are no signs that the downturn in
the operating business will soon bottom out. The only improvement in
volumes was reported by Great Britain, with a slight increase over
the (low) prior year level in September, which still cannot be
interpreted as a change in trend. For these reasons, cash
preservation and reduction in fixed costs will remain our top
priority", emphasized Heimo Scheuch, underscoring the Wienerberger
strategy.

Cost structures adjusted as part of action plan 2009

Wienerberger reacted to the sharp decline in demand during the first
quarter with an extensive action plan. After removing 27 plants from
the production network in 2008, the measures originally defined for
2009 involve the shutdown or mothballing of another 26 plants to
match market conditions as well as active working capital management
to reduce inventories by at least ¤ 100 million, a decrease in fixed
costs through restructuring in sales
and administration, and a cutback in investments to a minimum.

Action plan extended to five more plants

The development of business after the summer remained less favorable
than expected. Consequently the action plan was expanded to include
the closure or mothballing of five additional plants in Hungary,
Germany, Poland and the USA. An estimated 31 plants are to be closed
or mothballed during 2009 at a cost of ¤ 120 million (¤ 50 million of
cash expenses and ¤ 70 million of special write-downs) - 24 of these
plants were shut down during the first nine months. In addition,
extensive temporary standstills are planned to reduce inventories.
These measures affected a
total of 1,660 employees during the reporting period. The temporarily
closed locations and mothballed production lines represent a
substantial capacity reserve that can be reactivated quickly as
needed.

Cost savings of ¤ 135 million already realized

The measures implemented to date led to a year-on-year decrease of
roughly ¤ 135 million in personnel and maintenance costs during the
first nine months of 2009. In addition, active capacity management
supported a reduction of more than ¤ 100 million in inventories
compared with the first three quarters of 2008. Investments were also
cut by a significant amount: maintenance costs fell by one-half to
approx. ¤ 37 million, while the ¤ 68 million in growth investments
that were required to complete projects started in 2008 were 76% less
than in 2008.

Free cash flow of approx. ¤ 110 million

The success of the action plan has already been reflected in free
cash flow generation: despite weaker operating results and a
difficult operating environment, both cost savings and the reduction
of inventories allowed Wienerberger to generate an impressive free
cash flow of ¤ 109.9 million for the reporting period (2008: ¤ 122.2
million).

Approx. ¤ 155 million of cost savings expected in 2009

Cost savings for the full reporting year are forecasted to total ¤
155 million. In 2010 additional savings of at least
¤ 35 million are expected from the measures implemented during the
second half of 2009, which represents a cumulative reduction of ¤ 190
million in fixed costs compared with 2008.

Net debt reduced to ¤ 540.5 million

In order to increase financial flexibility, Wienerberger carried out
a capital increase in September and strengthened its equity base by
roughly ¤ 320 million with the issue of 33.6 million new shares (40%
of share capital). Equity subsequently rose by 4% to ¤ 2,587.4
million. Net debt was reduced from ¤ 978.6 million in June to ¤ 540.5
million as of September 30, 2009, with roughly ¤ 320 million of this
reduction coming from the capital increase and nearly
¤ 118 million from cash flow. Gearing improved from 43,3% to 20.9%
during the same period.

Higher cash flows and earnings expected in 2010

"Given the weak condition of new residential construction on all our
markets, I do not expect any significant improvement in earnings by
year-end 2009. Operating EBITDA for the second half of 2009 should
therefore reflect the level recorded for the first six months",
summarized Wienerberger CEO Heimo Scheuch. "Bank constraints on
financing, rising unemployment and the high number of foreclosures in
the USA are working against a turnaround in new residential
construction. It is too early to speak of recovery from today's
perspective because the economic environment is still difficult, but
the measures we have implemented lead me to be more optimistic about
2010.
Even if demand remains weak, I expect the coming year will bring
considerable improvement in earnings and cash flow due to the cost
savings realized through our action plan and an improved  utilization
of capacity in our plants."

Earnings Data


                                    1-9/      1-9/    Chg.   Year-end
                                    2008      2009    in %       2008
Revenues                 in ¤    1,926.8   1,416.7     -26    2,431.4
                         mill.
Operating EBITDA 1)      in ¤      364.7     177.5     -51      440.1
                         mill.
Operating EBIT 1)        in ¤      212.4      36.7     -83      239.8
                         mill.
Profit before tax        in ¤      160.9    -225.3   <-100      123.1
                         mill.
Profit after tax 2)      in ¤      133.0    -198.2   <-100      103.3
                         mill.
Earnings per share       in ¤       1.28     -2.68   <-100       0.81
Adjusted earnings per    in ¤       1.65     -0.01   <-100       1.69
share 3)
Free cash flow 4)        in ¤      122.2     109.9     -10      195.4
                         mill.
Maintenance capex        in ¤       71.7      36.6     -49       98.4
                         mill.
Growth investments       in ¤      282.2      67.7     -76      407.2
                         mill.



Balance Sheet Data


                                   31.12.2008   30.9.2009   Chg. in %
Equity (incl.         in ¤ mill.      2,497.2     2,587.4          +4
hybrid capital)
Net debt              in ¤ mill.        890.2       540.5         -39
Capital employed      in ¤ mill.      3,252.2     2,991.1          -8
Balance sheet total   in ¤ mill.      4,383.9     4,450.2          +2
Gearing               in %               35.6        20.9           -
Ø Employees                            15,162      12,922         -15



Segments 1-9/2009


in ¤ mill.   Central-    Central-    North- West     North      Investments
and %       East Europe West Europe   Europe 5)      America    and Other 6)
                            5)
Revenues    462.6 (-35) 300.1 (-13)   562.5 (-22) 118.3   (-35) -26.8  (+26)
Operating    87.2 (-58)  28.9 (-21)    85.4 (-32)  -9.0 (<-100) -15.0  (+19)
EBITDA 1)
Operating    39.7 (-75)   3.0 (-63)    36.3 (-48) -25.7 (<-100) -16.6  (+23)
EBIT 1)
Total        48.2 (-65)   8.7 (-67)    33.5 (-76)   9.0   (-73)   4.9  (-83)
investments
Capital     821.8  (-6) 432.3 (-18) 1,181.8 (-15) 510.0   (-10)  45.2 (>100)
employed
Ø Employees 5,300 (-10) 2,176 (-10)   4,098 (-15) 1,105   (-47)   243  (+10)



Segments 7-9/2009


                            Revenues            Operating EBITDA 1)
in ¤ mill.            7-9/    7-9/   Chg. in    7-9/   7-9/   Chg. in
                      2008    2009         %    2008   2009         %
Central-East         261.4   187.1       -28    73.8   38.7       -48
Europe
Central-West         125.1   117.7        -6    18.4   17.5        -5
Europe 5)
North-West Europe    225.0   182.3       -19    35.2   24.0       -32
5)
North America         63.4    42.0       -34     5.3   -1.1     <-100
Investments and      -11.7   -10.6        +9    -3.6   -2.2       +39
Other 6)
Wienerberger Group   663.2   518.5       -22   129.1   76.9       -40


1) Adjusted for non-recurring income and expenses
2) Before non-controlling interests and accrued hybrid coupon
3) Adjusted for non-recurring income and expenses; after hybrid
coupon
4) Cash flow from operating activities minus cash flow from investing
activities plus growth investments
5) Cross-border trading activities of the Netherlands and Germany
were transferred to the Central-West Europe segment as of January 1,
2009 (previously: North-West Europe); the comparable figures from the
prior year period were adjusted accordingly
6) Including Group eliminations and holding costs; negative revenues
are due to the offset of inter-company sales

Note: In the table of segment data, changes in % to the comparable
prior year period are shown in brackets


Visit www.wienerberger.com to download the Report on the First Three
Quarters with detailed information and view a live Internet
transmission of the teleconference with analysts at 2:00 p.m. CET.


For additional information contact:
Barbara Braunöck, Head of Investor and Public Relations
T +43(1)60192-467 | communication@wienerberger.com


Legal Disclaimer:
This press release serves marketing purposes in Austria. The offer of
securities of Wienerberger AG in Austria is being made solely by
means and on the basis of the published prospectus in accordance with
the provisions of the Austrian Capital Markets Act, which has been
published at the homepage of the company under www.wienerberger.com
and is available free of charge at Wienerberger AG (Wienerbergstraße
11, A-1100 Vienna).
This press release is not for distribution in or into the United
States of America and must not be distributed to U.S. persons (as
defined in Regulation S under the U.S. Securities Act of 1933, as
amended ("Securities Act")) or publications with a general
circulation in the United States. This press release does not
constitute an offer or invitation to purchase any securities in the
United States. The securities of Wienerberger AG have not been
registered under the Securities Act and may not be offered, sold or
delivered within the United States or to U.S. persons absent
registration under the Securities Act or an applicable exemption from
the registration requirements of the Securities Act. There will be no
public offer of securities of Wienerberger AG in the United States.
This press release is directed only at persons (i) who are outside
the United Kingdom or (ii) who have professional experience in
matters relating to investments falling within Article 19(5) of the
Financial Services and Markets Act 2000 (Financial Promotion) Order
2005 (as amended) (the "Order") or (iii) who fall within Article
49(2)(a) to (d) ("high net worth companies, unincorporated
associations etc.") of the Order (all such persons together being
referred to as "Relevant Persons"). Any person who is not a Relevant
Person must not act or rely on this communication or any of its
contents. Any investment or investment activity to which this
communication relates is available only to Relevant Persons and will
be engaged in only with Relevant Persons.


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Wienerberger AG
Wienerbergstraße 11 Vienna Austria

WKN: 83170; 
ISIN: AT0000831706; Index: WBI, ATX , ATX Prime;
Listed: Prime Market in Wiener Boerse AG;