Hanover, September 13, 2008. In view of the substantial worsening of the economic environment on the vehicle markets in North America and Europe in the third quarter and the unchanged high burdens from increased raw material cost, Continental AG, Hanover, no longer expects at present to fully attain the goals it set for fiscal 2008. Conditions have in part worsened significantly, especially in the automotive divisions, compared to the good development in the first six months of the current fiscal year. The rubber divisions are affected as well but not to the same extent.
From the current standpoint, an EBIT margin of around 8.5% is expected for fiscal 2008. This EBIT-margin is before the adjustment for amortization resulting from the purchase price allocation as well as integration and restructuring expense.
It should be noted positively that the planned reduction of indebtedness will be supported additionally by the high conversion rate that occurred in September for the convertible bond due in May 2011. As of today, more than 80% of the amount that was outstanding at the end of 2007, €377.1 million, has been converted.
A comprehensive interim reporting with more detailed statements will be provided when the figures for the first nine months are released on October 30, 2008.