LAPEYRE FIRST-HALF 2000 CONSOLIDATED SALES AND EARNINGS

The Board of Directors met on September 14, 2000 and examined the consolidated financial statements for the six months ended June 30, 2000.

CONSOLIDATED SALES: UP 12.8%
SALES BY BUSINESS
June 30, 2000
June 30, 1999
 %
E m
FRF m
E m
FRF m
 Change
B2C Market
453,3
2.973,5
395,1
2.592,0
 14,7%
LAPEYRE-GME-K PAR K
436,9
2.865,9
379,7
2.490,8
 15,0%
LAPEYRE EUROPE
16,4
107,6
15,4
101,2
 6,2%
B2B Market
164,2
1.077,0
152,2
998,4
 7,9%
SGM - OXXO - LES ZELLES
102,9
675,0
85,3
559,5
 20,7%
SOFIPLAS - LAPEYRE DEUTSCHLAND ERG-OKFENS
61,3
402,0
66,9
 438,9 - 8,4%
TOTAL LAPEYRE GROUP
617,5
4.050,5
547,3
3.590,4
 12,8%


In France, business was good in a promising market. In the rest of Europe, Group companies suffered from market conditions that remained unfavorable in Germany and weakened in Poland. At comparable scope of consolidation, sales were up by 11.3% for the period

FIRST-HALF 2000 CONSOLIDATED EARNINGS

The new French consolidated accounting standards have been applied as from 2000. Although the change had no material impact on the accounts, first-half 1999 figures have been restated on the same basis.
CONSOLIDATED EARNINGS
First-Half 2000
First-Half 1999
 %
E m
FRF m
 E m
FRF m
 %
Sales
617,5
4.050,5
547,3
3.590,4
 12,8
Operating income
61,8
405,4
57,9
379,8
 6,7
Consolidated net income
31,3
205,3
32,1
210,6
 - 2,4


Operating income of the French companies rose by 17.6% in the first half. However, higher raw materials prices and underperformance in Germany and Spain held growth in consolidated operating income to just 6.7%. Net income for the period was down 2.4% due to non-operating expenses (related primarily to Lapeyre España and Deutschland) and to the amortization of goodwill on Lapeyre Deutschland.

Cash flow remained strong at _ 55.7 million or 9% of sales. Working capital requirement was stable as a percentage of sales. Net debt totalled _ 7.5 million. Shareholders’ equity amounted to _ 518.4 million.

OUTLOOK

In France, the favorable general economic environment should sustain strong sales and earnings at all Group companies. The reduced VAT rate on installation services will be especially beneficial to the B2C business. as installable product backlog is already deep.

In Brazil, a partnership agreement, with a majority interest, has been signed with Telhanorte, the country’s second largest building materials wholesaler.

Overall, growth in sales should be comparable to that reported in the first half, but operating income will be affected by the sharp decline in operating income from the German, Polish and Spanish subsidiaries.

20/09/2000