GESCO AG increases annual forecast


Wuppertal, 31 October 2006 – The partners of Gewerbepark Wilthener Straße GmbH, Bautzen, in which GESCO AG holds a 40% participation, have sold the company to ANTAN Real Estate with effect from today. In light of this event, GESCO AG is increasing its forecast for the full year.

The participation in Gewerbepark Wilthener Straße GmbH did not fall within the industrial focus of GESCO AG and came about as a result of the economic restructuring in the former East Germany following the reunification. In 1992, GESCO AG launched an initiative for the renovation of an industrial wasteland area in Bautzen of 65,500m² in 1992, which was successfully built into a business park. This business park is now a base for over 40 companies with more than 1,000 jobs and training placements. The property has demonstrated sustained rental quotas of well over 90% and is seen as a showcase property far beyond Saxony.

Based on the one-off earnings from the sale, GESCO AG is increasing its forecast for group net income for financial year 2006/2007 (01.04.2006 – 31.03.2007) from around EUR 9.8 million to around EUR 11.8 million, equating to an increase in earnings per share from EUR 3.56 to EUR 4.29. The liquidity inflow resulting from the sale is intended to assist in the further reduction of net indebtedness and additionally optimise the already favourable balance sheet figures.

GESCO Chairman, Dr. Hans-Gert Mayrose commented, “As a small contribution to ‘rebuilding the East’, the business park represented an exception to our usual investment strategy. While we would normally acquire majority holdings in small and medium-sized manufacturing companies on a long-term basis, here we entered into a minority participation on a time-limited basis in view of the situation following the reunification. The level of economic success shows that the decision to enter into this deal was the right one.