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April 22, 2005

GERMANY: Beru Q1 results won’t be as expected

German automotive supplier Beru reportedly will fall short of its operating profit forecast for the year to March 31 due to lower than expected sales and warned on Friday that net profit would be hit by a tax charge.

German automotive supplier Beru reportedly will fall short of its operating profit forecast for the year to March 31 due to lower than expected sales and warned on Friday that net profit would be hit by a tax charge.

Beru said in a statement cited by Reuters that net profit would be hit by a €10 million ($US13 million) extraordinary charge following a tax audit going back to fiscal 1997/1998 and that 2004/2005 sales would rise by about 9%.

A spokeswoman reportedly said a weaker than expected fourth quarter performance meant the company would also miss its €51 million earnings before interest and tax (EBIT) target.

She told the news agency the shortfall would be “moderate” but declined to be more specific.

“The businesses with tyre pressure monitoring systems and auxiliary heating systems didn’t reach their growth targets for the final quarter and this will have an impact on our profit target,” she told Reuters.

The news agency noted that Beru, majority-owned by US-based supplier BorgWarner, had forecast sales to grow by 10% and EBIT to dip to €51 million from €53.4 million the previous year due to €5 million in costs related to BorgWarner’s takeover.

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