Continental AG Draws Consequences from the Significant Downturn in the Industry
Continental AG / Profit Warning/DividendRelease of an Ad hoc announcement according to § 15 WpHG, transmitted byDGAP - a company of EquityStory AG.The issuer is solely responsible for the content of this announcement.----------------------------------------------------------------------Hanover, December 10, 2008. Continental AG, Hanover, is drawing furthernecessary consequences for the closing fiscal year 2008 following anextensive analysis of the substantial negative development in theautomotive industry in the last six weeks.Based upon these adjustments and the latest figures available, an EBITmargin of 7.5% to 8.0% is viewed to be attainable for fiscal 2008. ThisEBIT margin figure is before the adjustment for amortization anddepreciation resulting from the purchase price allocation (PPA) as well asintegration and restructuring expenses.Furthermore, it is considered to refrain from paying dividends for fiscal2008 to bolster the consistent reduction of financial liabilities. In 2008,the company paid a dividend of €2 per share for fiscal 2007.Furthermore, goodwill impairment of up to one billion euros is possible inthe Automotive Group already on the 2008 balance sheet, in view of thedrastic drop in car sales predicted for 2009, especially in the markets inWestern Europe and North America.Thanks to the continuing strong business development in the Rubber Group, asubstantial free cash flow is expected for 2008 on the whole. In additionto the cash flow provided by the sale of company units undertaken to date(including the EMD business to Brose) and the extensive conversion of theconvertible bond with an original maturity date of May 2011, these freefunds noticeably help reduce the net financial indebtedness despite theadverse market climate.10.12.2008 Financial News transmitted by DGAP---------------------------------------------------------------------- Language: EnglishIssuer: Continental AG Vahrenwalder Straße 9 30165 Hannover DeutschlandPhone: +49 (0)511 938-1068Fax: +49 (0)511 938-1080E-mail: ir@conti.deInternet: www.conti.deISIN: DE0005439004WKN: 543900Indices: DAXListed: Regulierter Markt in Frankfurt (Prime Standard), Hannover, Hamburg, Luxembourg, Stuttgart; Freiverkehr in Berlin, München, Düsseldorf; Terminbörse EUREX; Foreign Exchange(s) SWX End of News DGAP News-Service ---------------------------------------------------------------------------