31-Dec Sales EBITDA Net Income EPS

Euro M Euro M Euro M Euro

2000 A 703
2001 A 636 107 48 1.1
2002 A 671 43 -30 0.1
2003 E 668 111 -81 1.0
2004 E 698 173 92 1.8

Profitability
Profitability
2001 2002 2003
Gross Margin (%) 60.3 55.3 62.6
Operating Margin (%) 10.1 (6.1) (47.2)
Net Profit Margin (%) 7.6 (4.5) (30.9)
Basic Earning Power 0.1 (0.0) (0.4)

Liquidity & Working Capital

2001 2002 2003
Quick Ratio 60.3 55.3 62.6
Current Ratio 10.1 (6.2) (47.2)
LT Debt / Equity 0.0 0.3 0.4
Total Debt / Equity 0.0 0.3 0.5
Total Debt / Total Assets 0.3 0.5 0.7
Days Receivable (Days) 115.0 122.0 127.0
Days Inventory (Days) 212.0 212.0 171.0
Days payables (Days) 128.0 101.0 94.0
Cash Conversion Cycle (Days) 199.0 233.0 204.0

Financial Structure
2001 2002 2003
TIE 24.7 (9.8) (60.6)
Working capital /turnover 0.5 0.3 0.4

WACC (%) 12.55%

Beta 1.4
cost of debt 5.50%
cost of equity 12.55%

Stockholder Return
2001 2002 2003
Earnings Per Share 0.9 (0.5) (3.7)
Sales Per Share 11.4 12.1 12.0
Book Value 9.2 8.2 4.5
Cash Flow 1.4 0.2 (3.0)
Cash Per Share 0.5 0.5 0.4

Value Creation
2001 2002 2003
Sales Growth (%) - 5.5 -
Return on Equity (%) 0.1 (6.2) (58.2)
Return on Assets (%) 0.1 (3.6) (23.0)
Return on Investments (%) 0.1 (5.4) (43.8)
ROCE (%) 0.1 (0.1) (0.6)
EVA
MVA

S/H Equity 2001 2002 2003

Total Equity (€ million) 509.2 457.8 251.6
Shares o/s (million) 55.6 55.6 55.6
Sales / Share (€) 11.44 12.07 12.03
Share Price (€) 40.43
Book Value / Share (€) 9.17 8.24 4.53
Price / Sales (€) 3.36
Price / Book (€) 8.93

Analyst Recommendations
Current 4 weeks ago 8 weeks ago 13 weeks ago
Buy 3 3 3 3
Outperform 2 2 2 2
Hold 2 1 1 1
Underperform 5 4 4 4
Strong Sell 3 5 5 5

Median Underperform

Comparison Estimates
Source Target (€) Date
DKW € 28.20 5/25/2004
AHORRO CORP SA  € 28.50 5/13/2004
FORTIS BANK  € 30.10 5/3/2004
ESPIRITO SANTO € 30.99 3/16/2004
BANESTO BOLSA  € 35.75 8/4/2004
GRUPO SANTANDER  € 37.00 4/21/2004
MORGAN STANLEY  € 40.00 3/18/2004
CAI CHEUVREUX  € 42.30 1/31/2004
CSFB € 46.00 5/17/2004
DEUTSCHE BANK € 47.00 5/26/2004
 ROIC P/E R/E rel
% x %

10.7 34.0 218

0.0 266.8 1,365
12.8 37.5 261
21.4 20.2 162

3 yr
Average
59.4 Gross Profit / Sales x 100 2003 = 396/632.6*100
(14.4) Operating Income / Total Revenu x 100 2002 = ((41) / 670) x 100
(9.3) Income after tax / total revenue 2003 = (206)/668 = -0.308 2002 = ((29.9)/670 =
(0.1) Ebit / total assets

3 yr
Average
59.4 (current assets - inventories) / current liabilities
(14.4) current assets / current liabilities
0.2
0.3 Total Debt / Total Assets 2003 = 129 / 881
0.5

3 yr
Average
Ebit / interest expenses

3 yr
Growth
(4.6)
0.6
(4.6)
(4.4)
(0.2)

3 yr
Average
 1.8
(21.4)
(8.8)
(16.4)
(0.2) Nopat * (1-tax) / (LTD + Eq)
2002 = ((41) / 670) x 100 = -6.119403
2002 = ((29.9)/670 = -0.045
BALANCE SHEET ANALYSIS

Balance Sheet
(millions) 2001 2002 2003
ASSETS
Fix Assets 148.0 170.8 235.4
Receivables 195.0 221.2 243.7
Goodwill & Intangibles 40.9 181.7 149.9
Inventories 317.6 305.0 211.6
Other 27.6 11.0 17.2
Cash 27.7 28.2 23.2
756.8 917.9 881.0
LIABILITIES & EQ
LTD 3.1 128.7 95.8
Eq 509.2 457.8 251.6
Min Int 1.7 2.0 0.9
Payables 163.5 213.9 178.4
Other Current Liabilities 67.7 88.1 318.0
Other Liabilities 11.6 27.4 36.3
756.8 917.9 881.0

Income Statement
(millions) 2001 2002 2003
Revenue 635.5 670.7 668.3
Operating Expenses 571.3 712.0 983.5
Op Income 64.2 (41.3) (315.2)
Interest Expense (2.6) (4.2) (5.2)
EBT 61.6 (45.5) (320.4)
Provision for tax 13.7 (15.6) (113.8)
IAT 47.9 (29.9) (206.6)
Minority Interests 0.1 3.6
Net Income 47.9 (29.8) (203.0)

Cash Flow

Potential Cash Flow

Stockholders equity structure

Number of shares (million) 55.6 55.6

Basic earning per share (euro) -0.54 -3.65
Dividends per share 0 0

Valuation Ratios
Share Price euros 40.43
Total Sh Equity euro millions 2246.129
Total Sales 668.3

###
EBITDA 2001 2002 2003 2004 E
Total Revenue 635 671 668 700
Cost of Revenue 232 285 237 250
GROSS REV 403 386 432 450

SGA Exp 118 141 145 144

Other Expenses 175 204 181 181
EBITDA 110 42 106 125

Depreciation 29 43 42 42
Unusual Expenses 18 40 379 50

EBIT 64 -41 -315 34

Common Size Balance Sheet
2001 2002 2003
ASSETS
Fix Assets 20% 19% 27%
Receivables 26% 24% 28%
Goodwill & Intangibles 5% 20% 17%
Inventories 42% 33% 24%
Other 4% 1% 2%
Cash 4% 3% 3%
100% 100% 100%
LIABILITIES & EQ
LTD 0% 14% 11%
Eq 67% 50% 29%
Min Int 0% 0% 0%
Payables 22% 23% 20%
Other Current Liabilities 9% 10% 36%
Other Liabilities 2% 3% 4%
100% 100% 100%

Working capital

WC 112.9 LTD + Eq +Min int - FA

WCR 276.9 Inv + rec - pay
SUMMARY: NPV / SHARE GROWTH (10yr)
ZERO MID (1.25% HIGH (2.5%
+0% € 24.24 € 26.46 € 28.89

EBITDA
2004 ∆
€ 26.85 € 29.28 € 31.96

2003
+10%
+15% € 28.15 € 30.70 € 33.50
+20% € 29.45 € 32.11 € 35.03

ZERO GROWTH 2004 / ZERO GROWTH ONWARDS

EBITDA 125 (million, see sheet EBITDA)
Growth Rate 0.00% (yrs 1-10 = Excess Return Period Yrs 11+ = Normal Mkt Growth)

2004 2005 2006 2007 2008

EBITDA € 125.00 € 125.00 € 125.00 € 125.00 € 125.00
Terminal Value
Exceptional € 108.00
Cashflows € 17.00 € 125.00 € 125.00 € 125.00 € 125.00

NPV € 1,345.59
PER SHARE € 24.24

ZERO GROWTH 2004 / 1.25% ONWARDS

EBITDA 125 (million, see sheet EBITDA)
Growth Rate 1.25% (yrs 1-10 = Excess Return Period Yrs 11+ = Normal Mkt Growth)

2004 2005 2006 2007 2008

EBITDA € 125.00 € 126.56 € 128.14 € 129.75 € 131.37
Terminal Value
Exceptional € 108.00
Cashflows € 17.00 € 126.56 € 128.14 € 129.75 € 131.37

NPV € 1,468.48
PER SHARE € 26.46

ZERO GROWTH 2004 / 2.5% ONWARDS

EBITDA 125 (million, see sheet EBITDA)
Growth Rate 2.50% (yrs 1-10 = Excess Return Period Yrs 11+ = Normal Mkt Growth)

2004 2005 2006 2007 2008

EBITDA € 125.00 € 128.13 € 131.33 € 134.61 € 137.98
Terminal Value
Exceptional € 108.00
Cashflows € 17.00 € 128.13 € 131.33 € 134.61 € 137.98

NPV € 1,603.60
 PER SHARE € 28.89

10% GROWTH 2004 / 0% GROWTH ONWARDS

EBITDA 137.5 (million)
Growth Rate 0.00% (yrs 1-10 = Excess Return Period Yrs 11+ = Normal Mkt Growth)

2004 2005 2006 2007 2008

EBITDA € 137.50 € 137.50 € 137.50 € 137.50 € 137.50
Terminal Value
Exceptional € 108.00
Cashflows € 29.50 € 137.50 € 137.50 € 137.50 € 137.50

NPV € 1,490.12
PER SHARE € 26.85

15% GROWTH 2004 / 0% GROWTH ONWARDS

EBITDA 143.75 (million)
Growth Rate 0.00% (yrs 1-10 = Excess Return Period Yrs 11+ = Normal Mkt Growth)

2004 2005 2006 2007 2008

EBITDA € 143.75 € 143.75 € 143.75 € 143.75 € 143.75
Terminal Value
Exceptional € 108.00
Cashflows € 35.75 € 143.75 € 143.75 € 143.75 € 143.75

NPV € 1,562.38
PER SHARE € 28.15

20% GROWTH 2004 / 0% GROWTH ONWARDS

EBITDA 150 (million)
Growth Rate 0.00% (yrs 1-10 = Excess Return Period Yrs 11+ = Normal Mkt Growth)

2004 2005 2006 2007 2008

EBITDA € 150.00 € 150.00 € 150.00 € 150.00 € 150.00
Terminal Value
Exceptional € 108.00
Cashflows € 42.00 € 150.00 € 150.00 € 150.00 € 150.00

NPV € 1,634.65
PER SHARE € 29.45

10% GROWTH 2004 / 2.5% GROWTH ONWARDS

EBITDA 137.5 (million)
Growth Rate 2.50% (yrs 1-10 = Excess Return Period Yrs 11+ = Normal Mkt Growth)

2004 2005 2006 2007 2008

EBITDA € 137.50 € 140.94 € 144.46 € 148.07 € 151.77
Terminal Value
 Exceptional € 108.00
Cashflows € 29.50 € 140.94 € 144.46 € 148.07 € 151.77

NPV € 1,773.93
PER SHARE € 31.96

MOST LIKELY
15% GROWTH 2004 / 2.5% GROWTH ONWARDS
EBITDA 143.75 (million)
Growth Rate 2.50% (yrs 1-10 = Excess Return Period Yrs 11+ = Normal Mkt Growth)

2004 2005 2006 2007 2008

EBITDA € 143.75 € 147.34 € 151.03 € 154.80 € 158.67
Terminal Value
Exceptional € 108.00
Cashflows € 35.75 € 147.34 € 151.03 € 154.80 € 158.67

NPV € 1,859.09
PER SHARE € 33.50

20% GROWTH 2004 / 2.5% GROWTH ONWARDS

EBITDA 150 (million)
Growth Rate 2.50% (yrs 1-10 = Excess Return Period Yrs 11+ = Normal Mkt Growth)

2004 2005 2006 2007 2008

EBITDA € 150.00 € 153.75 € 157.59 € 161.53 € 165.57
Terminal Value
Exceptional € 108.00
Cashflows € 42.00 € 153.75 € 157.59 € 161.53 € 165.57

NPV € 1,944.26
PER SHARE € 35.03

10% GROWTH 2004 / 1.25% GROWTH ONWARDS

EBITDA 137.5 (million)
Growth Rate 1.25% (yrs 1-10 = Excess Return Period Yrs 11+ = Normal Mkt Growth)

2004 2005 2006 2007 2008

EBITDA € 137.50 € 139.22 € 140.96 € 142.72 € 144.50
Terminal Value
Exceptional € 108.00
Cashflows € 29.50 € 139.22 € 140.96 € 142.72 € 144.50

NPV € 1,625.30
PER SHARE € 29.28

15% GROWTH 2004 / 1.25% GROWTH ONWARDS

EBITDA 143.75 (million)
Growth Rate 1.25% (yrs 1-10 = Excess Return Period Yrs 11+ = Normal Mkt Growth)
 2004 2005 2006 2007 2008
EBITDA € 143.75 € 145.55 € 147.37 € 149.21 € 151.07
Terminal Value
Exceptional € 108.00
Cashflows € 35.75 € 145.55 € 147.37 € 149.21 € 151.07

NPV € 1,703.71
PER SHARE € 30.70

20% GROWTH 2004 / 1.25% GROWTH ONWARDS

EBITDA 150 (million)
Growth Rate 1.25% (yrs 1-10 = Excess Return Period Yrs 11+ = Normal Mkt Growth)

2004 2005 2006 2007 2008

EBITDA € 150.00 € 151.88 € 153.77 € 155.70 € 157.64
Terminal Value
Exceptional € 108.00
Cashflows € 42.00 € 151.88 € 153.77 € 155.70 € 157.64

NPV € 1,782.11
PER SHARE € 32.11
 No. Shares 55.5 (million)
WACC 8.4% (percent)

2009 2010 2011 2012 2013 2014

€ 125.00 € 125.00 € 125.00 € 125.00 € 125.00 € 125.00
€ 1,372.01

€ 125.00 € 125.00 € 125.00 € 125.00 € 125.00 € 1,497.01

No. Shares 55.5 (million)

WACC 8.4% (percent)

2009 2010 2011 2012 2013 2014

€ 133.01 € 134.67 € 136.36 € 138.06 € 139.79 € 141.53
€ 1,553.48

€ 133.01 € 134.67 € 136.36 € 138.06 € 139.79 € 1,695.02

No. Shares 55.5 (million)

WACC 8.4% (percent)

2009 2010 2011 2012 2013 2014

€ 141.43 € 144.96 € 148.59 € 152.30 € 156.11 € 160.01
€ 1,756.28

€ 141.43 € 144.96 € 148.59 € 152.30 € 156.11 € 1,916.29

 No. Shares 55.5 (million)
WACC 8.4% (percent)

2009 2010 2011 2012 2013 2014

€ 137.50 € 137.50 € 137.50 € 137.50 € 137.50 € 137.50
€ 1,509.21

€ 137.50 € 137.50 € 137.50 € 137.50 € 137.50 € 1,646.71

No. Shares 55.5 (million)

WACC 8.4% (percent)

2009 2010 2011 2012 2013 2014

€ 143.75 € 143.75 € 143.75 € 143.75 € 143.75 € 143.75
€ 1,577.81

€ 143.75 € 143.75 € 143.75 € 143.75 € 143.75 € 1,721.56

No. Shares 55.5 (million)

WACC 8.4% (percent)

2009 2010 2011 2012 2013 2014

€ 150.00 € 150.00 € 150.00 € 150.00 € 150.00 € 150.00
€ 1,646.41

€ 150.00 € 150.00 € 150.00 € 150.00 € 150.00 € 1,796.41

No. Shares 55.5 (million)

WACC 8.4% (percent)

2009 2010 2011 2012 2013 2014

€ 155.57 € 159.46 € 163.44 € 167.53 € 171.72 € 176.01
€ 1,931.91
€ 155.57 € 159.46 € 163.44 € 167.53 € 171.72 € 2,107.92

No. Shares 55.5 (million)

WACC 8.4% (percent)

2009 2010 2011 2012 2013 2014

€ 162.64 € 166.71 € 170.87 € 175.15 € 179.52 € 184.01
€ 2,019.73

€ 162.64 € 166.71 € 170.87 € 175.15 € 179.52 € 2,203.74

No. Shares 55.5 (million)

WACC 8.4% (percent)

2009 2010 2011 2012 2013 2014

€ 169.71 € 173.95 € 178.30 € 182.76 € 187.33 € 192.01
€ 2,107.54

€ 169.71 € 173.95 € 178.30 € 182.76 € 187.33 € 2,299.55

No. Shares 55.5 (million)

WACC 8.4% (percent)

2009 2010 2011 2012 2013 2014

€ 146.31 € 148.14 € 149.99 € 151.87 € 153.77 € 155.69
€ 1,708.83

€ 146.31 € 148.14 € 149.99 € 151.87 € 153.77 € 1,864.52

No. Shares 55.5 (million)

WACC 8.4% (percent)
 2009 2010 2011 2012 2013 2014
€ 152.96 € 154.87 € 156.81 € 158.77 € 160.75 € 162.76
€ 1,786.50

€ 152.96 € 154.87 € 156.81 € 158.77 € 160.75 € 1,949.27

No. Shares 55.5 (million)

WACC 8.4% (percent)

2009 2010 2011 2012 2013 2014

€ 159.61 € 161.61 € 163.63 € 165.67 € 167.74 € 169.84
€ 1,864.18

€ 159.61 € 161.61 € 163.63 € 165.67 € 167.74 € 2,034.02

 2001 2002 2003 2004 E
Total Revenue 635 670.7 668.5 700
Cost of Revenue 231.7 284.5 236.7 250
GROSS REV 403.3 386.2 431.8 450

SGA Exp 118.4 141.1 145 144

Depreciation 28.8 42.7 41.5 41.5
Unusual Expenses 17.6 40.2 379.2 50
Other Expenses 174.7 203.5 181 181
OPERATING INCOME 63.8 -41.3 -314.9 33.5

EBITDA 110.2 41.6 105.8 125

EVA

[EBT x (1 - T)] - [(Debt + Equity) x

Basic profitability ratios

Liquidity ratios
2003 2002
Current ratio 1.36 1.74 current assets / current liabil
Quick ratio 0.82 0.80 (current assets - inventories)

Asset Management ratios

2003 2002
Inv turnover 1.72 1.18 Sales / inventory
Avrg collection period 208.79 186.62 Receivables / daily sales
FA turnover 0.99 1.02 Sales / net fixed assets
Assets turnover 0.40 0.39 Sales / total assets

Debt ratios
2003 2002
Debt ratio 57.0% 49.9% Debt / total assets
TIE 7.9 - 0.6 Ebit / interest expenses

Additional profitability ratios

2003 2002
Basic earning power ratio 3.0% -0.11% Ebit / total assets
ROA -11.7% -2.7% Net income / total assets

Market value ratios

2003 2002
Price to earning (PER) Price per share / earning per
Market book ratio 0.14 0.09 Market price per share / boo
Book value per share 6,439.9 8,241.2 Common equity / shares out

Assumption Price per sha 912 754

Dividend Yield 0.0% 0.0% Dividend D1 / Price share P0
DPO (dividends pay out) 0.0% 0.0% Dividend / net income
 WACC] 352.6
-118.4
-28.8
-17.6
-174.7
13.1

current assets / current liabilities

(current assets - inventories) / current liabilities

Sales / inventory
Receivables / daily sales
Sales / net fixed assets
Sales / total assets

Debt / total assets

Ebit / interest expenses

Ebit / total assets

Net income / total assets

Price per share / earning per share

Market price per share / book value per share
Common equity / shares outstanding
Dividend D1 / Price share P0
Dividend / net income