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Press Release Stepken: Pace of acquisition of companies significantly stepped up in 2010 10 May 2010 TÜV SÜD continues its course of growth Munich. Despite the global financial and economic crisis, TÜV SÜD succeeded in significantly increasing its revenue in 2009. The international service group grew in its core competency areas and managed a good start to 2010. This is how President and CEO Dr Axel Stepken summarized the group's favourable situation at the annual balance sheet press conference at the corporate headquarters in Munich. In fiscal 2009, TÜV SÜD's revenue rose by 4.5 per cent to EUR 1.427 billion, while the consolidated income before taxes remained almost at the previous year's level at EUR 101 million. The number of employees throughout the world rose by almost 500, to 14,635. All divisions and all regions contributed to the positive result. The service group expects further growth at international level in fiscal 2010, fuelled in particular by the acquisition of companies. "We have succeeded in further consolidating our position in our key domestic market in Germany, in growing in our core competency areas at international level and in positioning ourselves proactively in three innovative fields of the future: e-mobility, renewable energies and energy efficiency", explained Stepken. In Germany, TÜV SÜD has increased its market share across all fields of activity. After becoming the sole owner of FleetCompany, TÜV SÜD Group is now the largest provider of fleet management services operating independently of car manufacturers and leasing companies. Through the acquisition of the former Technical Inspection Unit of DOW Olefinverbund GmbH, the service group further strengthened its market leadership in the chemical sector. Stepken also showed very pleased with developments in the Automotive division. After re-structuring, the division has been back in the black since late 2009. The CEO and President was also highly satisfied with TÜVTURK: "The establishment of a Turkey-wide network of vehicle inspection centres has been completed", explained Stepken. "At five million cars, we are already inspecting more cars in Turkey than in Germany." The introduction of German-style vehicle inspection has already demonstrably contributed to higher road safety and fewer fatalities on Turkish roads. Page 2 of 4 All strategic business segments contributed to the positive development The Europe region – including the Middle East and Turkey – was the strongest performer in 2009, generating 83.9 per cent of total revenue, followed by the Asia-Pacific region at 10.5 per cent and the Americas region at 5.6 per cent. "In a difficult economic environment, we managed to increase our revenue in 2009 by 5.4 per cent in Europe and even 7.2 per cent in the Asia-Pacific region, whereas it dropped by 8.4 per cent in the USA", explained Chief Financial Officer and Chief Information Officer Dr Peter Klein. "Fortunately, all three strategic business segments of TÜV SÜD Group again contributed to revenue growth and the group's excellent result in fiscal 2009." As in 2008, one-off effects again adversely impacted on the income before taxes of the service group. Higher contributions levied by the pension guarantee association Pensions-Sicherungs-Verein, for example, amounted to EUR 9 million alone. Nevertheless, adjusted return on sales remained almost at the prior year's level at 8 per cent and the adjusted EBITDA margin, at 12.9 per cent, was only 0.1 per cent lower than in the previous year. Greater growth through acquisitions TÜV SÜD has noticeably stepped up the pace of inorganic growth. "We made targeted acquisitions in Germany, Europe, the USA and Asia-Pacific to further strengthen our leading international position in the respective areas", reported Stepken. One of the most significant acquisitions in the history of TÜV SÜD was the purchasing of Global Risk Consultants Corporation (GRC) in the USA. Employing 350 staff in 14 countries, the company generates sales of USD 55 million. "At a market share of 34 per cent, we are now the global market leader in independent property-loss consulting", underlined Chief Operating Officer Dr Manfred Bayerlein. "As an unbundled service provider, the GRC group can provide their services to support not only industrial companies, but also insurance brokers and insurance companies", continues Bayerlein. "The market for these services is characterized by dynamic growth. As the market leader, we will obtain a major share of this growth." Significant acquisitions in 2009 included the acquisition of Korean company GNEC, the regional leader in provision of testing and inspection services for nuclear power stations. By acquiring US Mechanical Integrity, a specialist in the fields of non-destructive testing and mechanical integrity, the company extended its range of services in the chemical and petrochemical industry at international level. Another recent acquisition was PS Playground Certification in Detroit, USA, which now makes TÜV SÜD the world's leading provider of testing and certification services for playgrounds and playground equipment. Another central pillar of growth is the foundation of new legal entities in various regions to enhance the development of national and regional markets. Over recent months, new subsidiaries have been set up Page 3 of 4 in France, Ukraine and Sri Lanka. In France, the new legal entity was founded and new local staff recruited to gain further shares in the insulated French market. The same applies to Ukraine, where TÜV SÜD's activities so far have mostly been managed via its subsidiary in the Czech Republic. In Sri Lanka, a major textiles exporter, TÜV SÜD also expects to raise its market share significantly by founding an own legal entity. "We often work with clients who operate at international level", explains Axel Stepken. "Hence, it is becoming increasingly important that we are represented wherever they are and offer them local services from a single source." Playing an active part in innovative themes of the future – the innovation project e-mobility By covering the innovative themes of e-mobility, energy efficiency and renewable energies, TÜV SÜD set its course at an early stage for an active part in shaping themes that will take on increasing importance at international level. "The success of e-mobility very much depends on whether we will succeed in introducing this technology onto our roads soon and, above all, safely", emphasized Stepken. "Given this, we have bundled all of the group's competencies in this field in a group-wide innovation project. These competencies span the entire chain of e-mobility from selecting the primary energy used for e-mobility, designing mobility models and evaluating them for their sustainability to establishing safety standards for electric vehicles and batteries and ensuring environmentally friendly recycling. Our e-mobility innovation project makes us a partner in our clients' processes and the first point of contact for industry." Early this year, TÜV SÜD opened the first electric charging station at TÜV Hanse in Hamburg. By operating its own electric cars, the service provider collects experience as to their suitability for everyday use. Energy efficiency – potential for savings between 15 and 30 per cent Against the backdrop of the problems associated with CO2 and of rising energy costs, energy efficiency is increasing in importance. TÜV SÜD considers the potential for savings to range between 15 and 30 per cent in industrial companies, alone. Given this, the company developed a series of services to support clients in making full use of this potential. Examples of these services include "Complex Energy Consulting" and the groundbreaking "Energy Efficient Enterprise" and "Energy Efficient System" certification. Page 4 of 4 The same applies to renewable energies. TÜV SÜD has in-depth expertise and extensive experience in energy production and contributes significantly to improving the safety, reliability and cost-efficiency of innovative technologies. The company, for example, supports manufacturers and owners/operators in developing new wind turbines and realizing full-scale wind farms or in the testing and certification of photovoltaic modules. TÜV SÜD is also in high demand as a partner in the implementation of groundbreaking pilot projects. For example, the service company saw through a solar thermal demonstration power station with Fresnel collector technology in Spain from the design, approval and construction phases to commissioning. "We made a successful start to 2010 through numerous acquisitions and will keep up the pace", promised CEO and President Stepken. In the medium term, TÜV SÜD plans to raise the share of total revenue generated abroad to 40 per cent. "We registered 9 per cent growth in other European countries and over 7 per cent in the Asia-Pacific region", added Chief Financial Officer Klein. A global position is important in particular when individual regions display weaknesses. "In 2009, for example, we more than compensated for the problems experienced by many of our US clients by growth in other regions", emphasized Klein, who is confident that TÜV SÜD is on the right track after its good start to 2010. Media Relations: Wilfried Sauer Tel. +49 (0) 89 / 57 91 – 16 13 TÜV SÜD AG Fax +49 (0) 89 / 57 91 – 22 24 Corporate Communications E-mail email@example.com Westendstr. 199, 80686 München Internet www.tuev-sued.de/is i TÜV SÜD is a leading international service organization catering to the strategic business segments INDUSTRY, MOBILITY and PEOPLE. Around 15,000 employees are represented at more than 600 locations throughout the world. Optimizing technology, systems and know-how, the interdisciplinary specialist teams act as process partners to strengthen their customers' competitiveness.
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