Group

In the wake of the global financial crisis, economies around the world will continue to weaken. Economic forecasters are currently expecting the growth of the global domestic product for the year 2009 to be half that of 2008. Even a business like ours cannot remain immune to the adverse economic climate. However, as a result of our global presence and our stable business model, we will be much better able to cushion the impact of the expected economic downturn than would have been the case prior to the reorganisation of the Group. In particular, our excellent position in the growth markets and in the established core regions such as Germany, the UK and Scandinavia will help us to absorb some of the impact of the probable downturn. Our order books at the end of September are well-filled and we continue to expect orders to be processed on schedule.

Against this background, we confirm our outlook for the current financial year 2008 and expect sales growth and an above-average increase in earnings.

Our medium-term target of achieving an operating profit of more than EUR 3 bn and a return on capital employed of at least 13 percent for the 2010 financial year must now be seen against the background of a more uncertain and significantly weaker economic environment. We also assume that exchange rates, on average, will remain at around their current levels.

In order to meet our medium-term targets even despite these more difficult conditions, we will put into action with speed and vigour the new programme for sustainable process optimisation and productivity improvement (HPO = High Performance Organisation) that was already set up at the beginning of the year. This integrated programme will result in a gross cost reduction of EUR 650 m to EUR 800 m in the next four years, from 2009.

HPO follows on directly from the synergy programme we devised when we acquired BOC. On the basis of this programme, cost synergies of EUR 250 m per annum will be achieved as planned in full for the first time in the 2009 financial year.