EANS-Adhoc: Mühlbauer takes stock: economy-related sales and earnings decline despite growth in the core business Cards & TECURITY® - stable dividend of EUR 1.00 per share scheduled

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ad-hoc disclosure pursuant to section 15 of the WpHG transmitted by euro
adhoc with the aim of a Europe-wide distribution. The issuer is solely
responsible for the content of this announcement.
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17.03.2010

Roding, 17 March 2010 - Against the background of the economically
difficult market environment, the internationally active Mühlbauer
technology group, listed in the Prime Standard, did not achieve its
ambitious goal of a stable sales and earnings development in the 2009
financial year. While the core business area Cards & TECURITY® proved
extremely robust in face of economic trends, as expected - with
further growth in earnings of 11.8%, to EUR 112.8 million (PY: EUR
100.9 million) - this was, however, unable to compensate for the
weakness recorded as a result of the dramatic economic decline in the
industry business. Thus, due to the lack of readiness to invest,
sales in Semiconductor Related Products dropped to EUR 29.5 million
(PY: EUR 34.9 million), while Traceability and Precision Parts &
Systems had to accept a decline to EUR 5.8 million (PY: EUR 17.7
million) and EUR 12.7 million (PY: EUR 19.4 million) due to the
economic slump. In view of this development, the consolidated sales
proceeds posted in respect of the year under review totaled EUR 160.5
million after deductions (EUR 0.3 million). Compared with the good
development of sales in the previous year (PY: EUR 172.6 million),
this corresponds to a 7.0% drop.

Furthermore, the unfavorable overall economic conditions experienced
in the reporting period, led to the discontinuation by the technology
group of its positive earnings development of previous years. Apart
from the decline in sales, the special effects in respect of the cost
of sales, caused by economic trends, were thus primarily responsible
for the fact that the EBIT of EUR 9.6 million in respect of the year
under review lagged behind the previous year´s value by EUR 14.7
million (PY: EUR 24.3 million). These special effects largely include
the lower utilization of production capacity and resultant idle
costs, as well as the EUR 5.7 million higher non-cash value
adjustments on inventory assets. Furthermore, higher
investment-related fixed costs in production, higher product
guarantees and the further rise in legal fees in connection with
patent disputes had a negative effect on income. The latter have,
however, been amicably settled since 15 January 2010. In Q1 2010, the
company records the discontinuation of attributable legal fees of EUR
2.0 million, resulting from the settlement, with an effect on the
income statement. Altogether, the EBIT developments described
previously and a financial result of EUR 0.1 million, which remained
unchanged year-on-year, led to a reduction of earnings before taxes
to EUR 9.7 million, after EUR 24.4 million in the previous year. This
corresponds to a profit margin of 6.0% (PY: 14.1%). At EUR 7.3
million, the Group´s net earnings were EUR 11.0 million lower
year-on-year (PY: EUR 18.3 million), which amounts to earnings per
share of EUR 0.50 (PY: EUR 1.24).

The personally liable shareholder and the Supervisory Board intend to
continue the dividend policy of past years, which was characterized
by continuity and reliability, and will propose the payment of an
unchanged dividend of EUR 1.00 per share in respect of the year under
review to the Annual General Meeting.

Cashflow from operating activities rose to EUR +30.2 million in the
reporting period due to the considerably higher inflows from the
disposal of short-term securities for the financing of investment and
financing activities as well as the reduction of financial resources
tied up in working capital. This corresponds to a EUR 8.2 million
increase against the same period of the previous year (PY: EUR
+22.0). Additionally, cashflow from investment activities increased,
which rose by EUR -9.7 million from EUR -6.0 million to EUR -15.7
million, in the course of the rise in gross investment volume from
EUR 10.4 million in 2008 by EUR 8.9 million to EUR 19.3 million. In
the year under review the adjusted free cashflow totaled EUR +3.3
million after EUR +6.3 million year-on-year, while net liquidity
dropped EUR 9.3 million, from EUR 35.1 million to EUR 25.8 million,
largely due to the progressive internationalization of the company
and the dividend payments made. At 77.9% (PY: 77.5%), the company´s
equity ratio remained virtually unchanged year-on-year.

The order income achieved by the technology group in the year under
review amounted to EUR 155.8 million, due to the natural volatilities
occurring in connection with government projects and the economically
weak industry business, thus lagging the previous year´s value (PY:
EUR 189.2 million) by 17.7%. At the same time, order backlog dropped
from EUR 80.8 million at the end of the previous year by 12.3%, to
EUR 70.9 million to the end of the year under review.

Mühlbauer´s business model is based on a solid foundation. Its unique
characteristic and the good positioning of the technology group
should therefore, on principle, enable the company to increase sales
and earnings on a year-on-year basis in the current financial year
and to achieve further growth in the following year - irrespective of
project-based fluctuations on the government-related TECURITY® market
and the risk that the economy may not recover sustainedly.
Furthermore, the company will continue its strategy of developing a
leading position in the Cards & TECURITY® area as a system partner
for worldwide ID solutions.

Contact and additional information: Investor Relations, Tilo
Rosenberger, Phone: +49 (0) 9461-952-1653, Fax: +49 (0)
9461-952-8520, investor-relations@muehlbauer.de, Mühlbauer Holding AG
& Co. KGaA, Josef-Mühlbauer-Platz 1, 93426 Roding, Germany,
www.muehlbauer.de

end of announcement euro adhoc
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ots Originaltext: Mühlbauer Holding AG
Im Internet recherchierbar: http://www.presseportal.de

Further inquiry note:

Hubert Forster

CFO

+49(0)9461-952-1141

hubert.forster@muehlbauer.de

Branche: Machine Manufacturing
ISIN: DE0006627201
WKN: 662720
Index: CDAX, Prime All Share, Technology All Share
Börsen: Frankfurt / regulated dealing/prime standard
Berlin / free trade
Hamburg / free trade
Stuttgart / free trade
Düsseldorf / free trade
München / free trade