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<strong>Melitta</strong> counters raw material price risks by concluding<br />
long-term procurement contracts and using derivative<br />
financial instruments.<br />
The monitoring and controlling of financial risks is<br />
entrusted to the Group’s treasury division. Foreign<br />
exchange and interest hedging instruments (options,<br />
swaps, futures and interest derivatives) are used where<br />
necessary to hedge against specific risks from existing<br />
or foreseeable underlying transactions. Liquidity risks<br />
and risks from cash flow fluctuations are countered by<br />
group-wide and ongoing liquidity planning.<br />
No recognizable risks jeopardizing the company<br />
Based on an analysis of the current risk situation, it can<br />
be stated that there are no risks at present which might<br />
jeopardize the Group’s continued existence. There are<br />
also no currently recognizable risks which might jeopardize<br />
the Group’s continued existence in future.<br />
Start of 2011 and outlook<br />
Positive external conditions<br />
<strong>Melitta</strong> got off to a successful start in 2011. The macroeconomic<br />
conditions are promising on the whole. In<br />
Germany, we expect consumer spending to benefit from<br />
the more favorable economic climate. Our markets in<br />
North and South America also provide encouraging conditions<br />
for further growth: we intend to expand our business<br />
in Brazil with the further regional extension of the<br />
<strong>Melitta</strong> sales system. Our investment in a new roasting<br />
plant in the USA has also created sufficient capacity to<br />
drive our business in this region.<br />
We expect to make further encouraging progress in our<br />
specialist paper business. There is considerable potential<br />
in Germany and abroad which we aim to exploit not<br />
only with our business in Neu Kaliss, but as of late <strong>2010</strong><br />
also with our newly founded company Neukölln Spezialpapier<br />
in Berlin. <strong>Melitta</strong> will invest approx. € 15 to € 18<br />
million up to 2012 in the expansion and modernization<br />
of its paper plant in Berlin via the new company. This<br />
will result in further expansion of the Group’s industrial<br />
business.<br />
No material changes in the Group’s structure are<br />
planned for 2011.<br />
Group Management <strong>Report</strong><br />
Under consideration of the prorated investment in the<br />
new paper machine, capital expenditures of around € 35<br />
million will far exceed depreciation in 2011.<br />
At the end of the year, we expect net bank liabilities to<br />
reach approximately € 35 million. This figure includes<br />
the aforementioned capital expenditures, funds to<br />
finance current operating activities and scheduled withdrawals<br />
by the owners. The funds required will be covered<br />
by the use of our existing short- and long-term borrowing<br />
facilities.<br />
We expect the balance sheet to remain healthy in 2011<br />
with a strong equity base and low level of debt.<br />
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