Belron's External Sales Up 7 Percent for First Half of 2008

For the first half of 2008, Belron sales grew by 7 percent to approximately $1,570 million U.S. dollars (1,068 million Euros), consisting of 6 percent organic growth and 7 percent acquired growth, according to a press release issued this morning by parent company D'Ieteren. The acquired growth was offset by a currency translation impact of 6 percent, mainly due to the strength of the Euro against the U.S. dollar and GB pound, according to the company. The company reported that total repair and replacement jobs grew by 11 percent to 4.6 million.

In Europe, after both acquisitions and currency translation, sales growth amounted to 2 percent, which comprised growth of 6 percent offset by an adverse currency impact of 4 percent due to the weak GB pound, D'Ieteren reports.

The company attributes its sales growth to increased radio advertising and its relationships with insurers and fleet partners.

Outside Europe, after both acquisitions and currency translation, sales growth amounted to 16 percent. This comprised 18 percent due to the acquisition of Safelite Group Inc., which, in 2007, was effective only from the beginning of March, as well as organic growth of 6 percent. There was an offsetting currency impact of 8 percent due to the weak U.S. dollar, according to the release.

Belron's operating result grew from $118 million to approximately $128 million for the first half of 2007-an increase of 8.5 percent.

"The increase in operating result is largely attributed to sales increases across the portfolio of businesses together with operational efficiency gains," reads the release. "The investment in marketing costs, particularly radio, and branch expansion in order to drive sales offset market declines as a result of a mild winter."

Net finance costs amounted to approximately $22 million, compared to approximately $26 million for the first half of 2007. The company reports that current net finance costs increased from approximately $24 million from the first half of 2007 to approximately
$25 million due to "additional borrowings used to finance the Safelite purchase offset by improved working capital."

The company's current results before taxes rose by 11.9 percent, to approximately $79 million from approximately $72 million.

"The outlook for the remainder of the year is for continued organic sales growth as Belron remains committed to delivering outstanding service to its customers, its key insurance and fleet partners, and improving its operational efficiency," reads the release. "The impact of the Diamond Glass acquisition will be minimal on the second half operating profit during the initial integration phase. The investment required to close branches and merge the Diamond Glass back office functions into existing operations is currently under review."

CLICK HERE to view full text of press release from D'Ieteren.

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