VERBIO expects better results not before 2008

3/19/2007, 9:46 AM (Source: GlobeNewswire)

VERBIO-2.82%

53.35
Chart for: VERBIO VER.BIOENERGIE  ON



2007 burdened with weak demand of ethanol despite of mandatory
blending, continuing margin pressure in the biodiesel business

Hamburg/Zörbig, March 18, 2007. - VERBIO Vereinigte BioEnergie AG
(ISIN DE000A0JL9W6), one of the leading producers and suppliers of
biofuels in Europe anticipates sales and earnings in 2007
substantially below the previous year's figures. The businesses will
not improve before 2008. However for 2006 the operating results were
fully achieved.

Based on the current existing negative industry and tax related
environment the Board of Management of VERBIO anticipates 2007 as a
difficult year in which the previous year's results won't be
achieved.The Board of Management has raised concerns that the
operating result of the Group in 2007 will be in the single-digit
million EUR range.
The bioethanol business is currently especially burdened due to the
very hesitant fulfilment of the mandatory blending and still high
crop prices. Furthermore large volumes of cheap ethanol were imported
from Brazil to Europe, produced out of low-priced sugar cane. This
has led to a stop of ununtil then positive price development of
ethanol.
The biodiesel business is still under pressure because of the weak
crude oil price and the high rapeseed oil price. Despite of the
difficult business conditions VERBIO is satisfied with the current
utilisation of the biodiesel capacity. In fact the overcapacity in
Germany leads to additional margin pressure but for VERBIO as cost
and technology leader it also offers opportunities to gain market
share and to play an active role during the consolidation process. In
addition VERBIO has a successful export business both in biodiesel as
in bioethanol. If the German legislation however sticks to its
taxation plans for pure biodiesel the B100-business could not be
carried on profitable from 2008 onwards.

VERBIO assumes that the economic situation of the biofuel industry
will improve in the second half of the 2007 due to declining rapeseed
oil and crop prices. The Board of Management expects a sustainable
and significant improvement not until 2008. Inspite of this the Board
of Management is strongly convinced that the long term growth trend
of the biofuel sector in Europe is fully intact.

Operating targets in 2006 achieved
Listed in the Prime Standard segment of the German Stock Exchange
(Deutsche Börse) since October 16, 2006, the company raised sales of
EUR 446.2 million in the full year of 2006. This represents an
increase of roughly 57% or EUR 161.6 million in comparison to 2005 as
a whole (EUR 284.6 million). In the same period, the operating result
before special items rose to 55.5 million EUR (EBIT-Marge 12.4%)
after 25.0 million EUR for 2005 (EBIT-Marge 8.8%). After special
items the operating result for 2006 was 44.1 million EUR (EBIT-Marge
9.9%) and 23.9 million EUR in 2005 (EBIT-Marge 8.4%).

Sales in the 4th quarter of the calendar year (2nd quarter of the 2nd
abbreviated financial year 1 July - 31 December 2006) was 120.5
million EUR and thus slighty above the sales figure of the 3rd
quarter of the calendar year (1st quarter of the 2nd abbreviated
financial year 1 July - 31 December 2006: 120 million EUR). The
operating result of the 4th quarter of the calendar year was burdened
due to declining prices for biodiesel and high prices for crop and
energy. In addition not liquidity-related special items in the amount
of 5.6 million EUR had an negative impact especially on the operating
result of the ethanol segment.

In total the results in 2006 were seriously influenced by not
liquidity-related special items in the amount of 11.4 million EUR.
They apply with 4.6 million EUR to adjustments of claims in respect
of investment grants and subsidies, with 6.3 million EUR to
depreciations of orders on hand in the context of initial
consolidation and with 0.5 million EUR for costs due to the
establishment of the corporation.

The profit before tax for 2006 amounts to 38.8 million EUR (2005:
17.8 million EUR). The profit after tax accounts for 26.6 million EUR
(2005: 11.6 million EUR).

Please find an overview in the pdf document attached to this press
information.

Segments

Sales in the Biodiesel and Bioethanol segments grew to 302.0 million
EUR (2005 as a whole: 205.8 million EUR) and 123.2 million EUR (2005
as a whole: 55.7 million EUR ), respectively. The operating result
before special items in the Biodiesel segment was 45.7 million EUR
(2005 as a whole: 36.2 million EUR ), after special items 41.0
million EUR (2005 as a whole: 35.1 million EUR). In the biodiesel
segment the reduction of the tax relief starting from August 1, 2006
and the more than 20% declined crude oil price diluted the result.
The operating profit before special items in the bioethanol segment
was 8.7 million EUR, after special items 2.0 million EUR. In 2005 the
operating result was minus 12.4 million EUR.

Please find an overview in the pdf document attached to this press
information.

In the next years the company will invest about 300 to 400 million
EUR in order to extend its leading market position in Europe. Apart
from expanding one of its current facilities, this is to be achieved
above all by building up new locations.

The annual report of the VERBIO Vereinigte BioEnergie AG will be
published at the press conference on March 29, 2007.

Contact
VERBIO Vereinigte BioEnergie AG
Alexandra Mühr
Tel.: (+49) 34956 / 303 90
Fax: (+49) 34956 / 303 99
E-mail: pr@verbio.de


Information on VERBIO Vereinigte BioEnergie AG
The VERBIO Group is one of the leading producers and suppliers of
biofuels and also the only industrial-scale producer of biodiesel and
bioethanol in Europe. Nominal capacity currently amounts to around
400,000 tons of biodiesel and 300,000 tons of bioethanol per year.
The company has developed its own processes and innovative
technologies for the production of biodiesel and bioethanol. It
supplies its products directly to European mineral oil corporations,
mineral oil traders, independent gas stations and haulage companies.
VERBIO AG also markets high-quality pharmaglycerin for the consumer
goods and cosmetic industries (glycerin is a by-product of biodiesel
production). Within the Group, VERBIO AG acts as the management
holding company. The Group's operating business is run by its
subsidiaries: MUW Mitteldeutsche Umesterungswerke, NUW
Nordbrandenburger Umesterungswerke, MBE Mitteldeutsche BioEnergie,
NBE Nordbrandenburger BioEnergie and SBE Swiss BioEnergy.
Important Note
This Ad hoc announcement contains forward-looking information, which
is based on assumeptions and estimates of the company management of
VERBIO Vereinigte BioEnergie AG. Even though company management
believes that these assumptions and estimates are correct, the actual
future development and actual future results can deviate
substantially from these assumptions and estimates due to many
factors. For example, these factors can include alteration of the
economic situation, legal and regulatory constraints in Germany and
the EU, and changes in the industry. VERBIO assumes no liability and
provides no warranty that future developments and actual future
results will agree with the assumptions and estimates expressed in
this interim report.


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