RATIONAL (RAA) Q4 2012 earnings summary

Executive summary

• Record 2012 sales of €435.0m, up 11% YoY (9% after FX adjustment); EBIT rose 20% to €122.7m, with growth across all regions.

• Efficiency gains, stronger product demand and positive FX supported earnings; Q4 sales were flat YoY against an unusually strong Q4 2011 comparison.

Financial highlights

• Revenue €435.0m, up €43.3m or 11% YoY; appliance sales were 77% of revenue, with accessories, spare parts and care products at 23%.

• Gross profit increased 12% to €261.7m; gross margin was 60.2% versus 59.8% in 2011.

• EBIT rose 20% to €122.7m; group earnings increased 18% to €93.3m and EPS rose 18% to €8.20.

• Operating cash flow reached €111.4m, up 65%; free cash flow was €102.0m after €9.4m of investment.

• Sales growth was primarily volume-led with average prices largely stable; positive currency effects contributed ~2 percentage points to growth.

Outlook and guidance

• Expected sales and EBIT growth in 2013 and 2014 in a comparable range to recent years, supported by untapped market potential and strong product acceptance.

• 2013 FX effect expected to be neutral or slightly negative, versus a positive contribution in 2012.

• 2013 investment budget ~€10m, including maintenance and completion of the Landsberg office and training building; funded from internal funds and borrowings.