Rieter shareholders agree to split of the Rieter Group

Shareholders at 120th Annual General Meeting of Rieter Holding Ltd approved all proposals by the Board of Directors, also including a split of the Rieter Group by separating the Textile Systems and Automotive Systems divisions into independent listed companies. They furthermore voted Erwin Stoller to the Board of Directors for another 3-year term of office.

The 120th Annual General Meeting of Rieter Holding Ltd was attended by 813 shareholders representing 51% of share capital. They approved all Board proposals, the Annual Report with the annual accounts and consolidated financial statements for 2010, formal discharge of the Board of Directors and Group management team members for the business year 2010, and change of company purpose required in connection with the Group split. Consultative approval of the Compensation Report was confirmed by some 90% of those present. Shareholders furthermore voted Erwin Stoller to the Rieter Board of Directors for another 3-year term of office.

Board Chairman Erwin Stoller opened the meeting by pointing out its historical importance: shareholders were asked to approve a split of the Rieter Group by separating the textile machinery and automotive supply businesses into independent listed companies. 99% of shareholders present approved this proposal, which included payment of a special dividend to Rieter Holding Ltd shareholders in the form of registered shares in Autoneum Holding Ltd.

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Striking growth at Rieter Textile Systems

As a leading supplier to the textile machinery and automotive markets, Rieter successfully exploited the improved market environment in the first half of 2010 to generate organic growth. Compared with the same period of the previous year, Rieter’s order intake increased by 92% to 1'615.3 million CHF (840.0 million CHF in 2009) and sales grew by 34% to 1'201.3 million CHF (899.8 million CHF in 2009).

The Rieter Group and both divisions returned to profit at the operating level. The Rieter Group achieved an operating result before interest and taxes (EBIT) of 14.6 million CHF in the first six months. Rieter will reach the announced turnaround and expects to reaffirm the positive half-year operating result for the 2010 financial year as a whole. Furthermore, Rieter already aspires to a positive net result for the current year.

Rieter’s markets revived significantly again in the first half of 2010, thus continuing the trend recorded in the second half of 2009. As a leading supplier to the textile and automotive industries, Rieter exploited this market recovery, which was especially pronounced in the textile machinery sector, to generate growth in all regions.

The ongoing restructuring programs, which will for the most part be completed at the end of 2010, continued to be implemented in the first six months. They have made a significant contribution to the improvement in results. At the same time Rieter pressed on with important projects for the further expansion of capacity in both divisions in Asia and the development of market-specific products manufactured locally.

In the context of restructuring measures and the strategy of focusing on the core business, the sale of the nonwovens activities announced in the fourth quarter of 2009 and the disposal of automotive design and engineering firm Idea Institute were completed on March 9 and June 30, 2010, respectively.

Orders received at the Rieter Group rose by 92% to 1'615.3 million CHF (840.0 million CHF in 2009). This was mainly attributable to striking growth at Textile Systems, where orders increased four-fold, and orders were also 35% higher at Automotive Systems. Adjusted for exchange rate fluctuations the increase for the group as a whole amounted to 94%. There covery in the markets, which gained momentum in the course of the period under review, affected all regions.

Group sales rose by 34% to 1'201.3 million CHF (899.8 million CHF in 2009). Expressed in local currencies, the increase amounted to 35%. This growth was equally attributable to the improved trend of business at both Textile Systems and Automotive Systems.

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