A tough market and building new wiring systems facilities in Eastern Europe characterised the 3rd quarter of 2003 for LEONI AG. As LEONI’s quarterly report shows, sales for the 3rd quarter of 2003 of about EUR 266 million meant that the Company almost managed to maintain the level recorded in the same quarter of 2002 (EUR 269 million). In so doing, the Company registered consolidated sales of EUR 817 million after nine months of 2003, a figure down by only a small 1.7 percent margin on the previous year’s EUR 831 million. On a currency-adjusted basis there would even have been an increase by about three percent. Heavy pressure on prices in fiercely contested markets and substantial advance outlays on new production facilities in Eastern Europe did squeeze earnings as expected, however. Earnings before taxes (EBT) therefore amounted to EUR 31.6 million on 30 September 2003, or about five percent less than in the previous year.

The company’s management reaffirms the sales and earnings forecasts already provided in the 2003 half-year report. Overall, consolidated sales are thus likely to be down about two to three percent on the previous year, which even equates to a small increase on a currency-adjusted basis. Net income will likely be down about 15 percent year on year because of heavier advance expenses arising in the 4th quarter of 2003 in connection with the Wiring Systems Division’s major projects. There is the risk, however, that it may not be possible to adhere to this level if persisting weak demand were to call for further measures to restructure the Wire Division before the end of 2003, thus affecting consolidated earnings.