Klett Annual Report 2009: Remaining on Solid Ground Despite the Crisis

Germany’s largest education company – the Klett Group – emerges even stronger from crisis ridden year 2009. This is corroborated by the Group’s 2009 Annual Report, which was published today. Chief Financial Officer Arthur Zimmermann takes a cautiously optimistic look forward into 2010 as well.

"We have not been paralysed by the uncertainties of early 2009; we took them on as challenges. Hence, we were able to move forward throughout the year despite all of the obstacles rather masterfully," comments Arthur Zimmermann, Ernst Klett AG CFO, as he contemplates the positive business results.

The difficult economic climate notwithstanding, the 2009 revenues of the Klett Group reflected a growth rate of 6.1 percent and rose to EUR 465.7 million. The profit totalled approximately EUR 14 million. The cash flow from regular business operations was reported to total EUR 19.1 million. The Klett AG equity capital quota was once again on a very high level, just like it had been in previous years: 42.7 percent. Consequently, the Klett Group did render proof in 2009 that it is indeed in a position to prevail and retain its positioning in the market place – even in times of general economic strive.

By the end of the fiscal year, Klett Group employed a workforce of 2,796. In 2009, the enterprise rolled out 2,688 new publications and boasted a portfolio of around 42,300 available titles.

The Klett Group generated most of its gains in the professional information segment as well as in adult and continued education. The Forum Institut für Management in Heidelberg, a new addition to the Group, which was integrated in 2009, has proven itself as an ideal complement and expansion to the Klett portfolio and has made notable contributions to the boost in revenues, even if its existing customer roster included some companies who had been severely rattled by the crisis. The business with text books, which continues to be the strongest pillar of the Klett Group, also developed positively. The economic crisis did have a more noticeable effect in the advertising market environment and in the business with Eastern Europe. Nonetheless, the stable overall situation of the remaining business segments compensated for these challenges. Consequently, all Klett Group companies were able to prove their resilience in the markets last year. The management board team of four considers this a clear sign that the decentralised structure of the company is working in its favour. "Our decentralised organisational structure composed of many entrepreneurs and companies who make up the Klett Group gives us the special level of flexibility that is essential in ever changing markets and ensures that the company is supported by several sturdy pillars," explains Zimmermann. "Managing this economic crisis has strengthened us further so that we are looking toward the future with cautious optimism."

In the summer of 2009, Klett emitted the second corporate bond in its corporate history and gave investors an opportunity to participate in the growth of a stable enterprise that is steeped in tradition. The demand for the bond - Bildungswertpapier II – was huge so that the total volume of EUR 50 million attained a 100 % subscription rate in just a few weeks – just like the first bond had in 2005.