Heckler & Koch Financial Results 2012

26.07.2013
Oberndorf, July 2013: The following general statement pertains to the financial statements of Heckler & Koch Beteiligungs GmbH (HKB) and of Heckler & Koch GmbH (HKO) for the years 2011 and 2012.

The Heckler & Koch Group (“HK”) does not require a “financial assistance” and is not “looking for investors” as speculated in some media. The current mid term business plan of HK forecasts profitability which will enable the individual entities and the group of companies to strengthen equity and reduce net debt.

With respect to the Financial Statements a distinction has to be made between HKB and HKO. HKB owns 100% of the share capital of HKO and 55% of its own shares (treasury shares). Owning treasury shares is quite common, especially stock listed companies use the instrument of redeeming shares. HKB can sell these shares, or parts thereof, to third parties. Such a sale is an appropriate instrument to raise equity and is thus comparable to a capital increase but would only be possible with the approval of all current shareholders. Based on positive business development such sale is neither necessary nor intended.

The balance sheets of HKO and HKB, based on German GAAP, show liabilities exceeding assets therefore negative equity. This has no impact with regards to insolvency law due to the auditors having confirmed a going concern status.

During the year 2012, the HKO-group generated a turnover of € 235 million, earnings from operations of € 42 million (EBIT) and profit before tax of € 9 million (PBT). The Consolidated Financial Statement for HKO-Group as per 31.12.2012, according to IFRS, is stating positive equity.

The current high level of debt and the negative equity of HKB and HKB-Group have nothing to do with the defence technology related activities of HKO as it is the result of value adjustments regarding investments of HKB in shares and securities triggered by the financial and economic crisis of 2008 and 2009.

The HKB/HKO - Group is solely financed by the corporate bond of € 295 million notes which are due in 2018. Net debt amounts to approximately € 270 million.

In its current business plan, HKO forecasts that it will continue its sound financial performance of the year 2012 in future years. Moreover, with strong profitability it plans to reduce debt and strengthen HK’s equity capital base. The interim financial statement of HKO (single entity) as of 30.6.2013 based on German GAAP states a positive equity in the two-digit millions.

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HECKLER & KOCH GmbH
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Germany

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