A breakdown of sales by application shows that all the segments in which the Group operates have been affected by the severe crisis that hit the world economy and especially the automotive industry. Applications for commercial vehicles decreased by 37.2%, the racing segment by 22.9%, the motorbike segment by 19.5% and car segment by 18.5%. The passive safety segment grew by 5.3% in 2009, thanks to the change in consolidation area.

Breaking down performance by geographical area, growth in Asia (with India growing by €18.5 million), which benefited both from the change in consolidation area and a positive market trend, marked a sharp contrast to the trend in the rest of the world; China grew by 87.5% to €22,5 million. Brazil also continued to grow, closing the year at €53.3 million, up 22.9% compared to 2008.

The traditional main markets of operation of the car industry inevitably bore the impact of the global severe economic crisis: Italy -32.4%, Germany -29.2%, France -28.1%, UK -29.1%, Japan -54.6%, Nafta -12.1%, although during the fourth quarter of the year the latter showed the first signs of recovery.

In financial year 2009, the cost of sales and other operating costs amounted to €539.6 million, representing 65.3% of sales, compared to 66.8% for the same period in the previous year. Personnel expenses for 2009 amounted to €185.1 million, with a ratio of 22.4% to sales, increasing 19.9% compared to the previous year, due to several nonrecurring expenses incurred for reorganisation initiatives and the natural increasing trend in labour costs.

The workforce numbered 5,417 at 31 December 2009 (5,847 at 31 December 2008). Like-for-like in terms of consolidation area, Group personnel decreased by 6.7% (- 383 people) compared to 31 December 2008. EBITDA for the year totalled €101.2 million (12.3% of revenues), compared to €140.9 million of 2008.

Net of certain non-recurring items recognised in the year, adjusted EBITDA was €108.4million (13.1% of revenues). Depreciation, amortisation and impairment losses amounted to €78.5 million, up 18.7% compared to €66.2 million for 2008. This item includes certain nonrecurring impairment losses that lead to an adjusted EBIT of €39.4 million (4.8% of revenues); taking into account such non-recurrent items, EBIT was €22.6 million (2.7% of revenues).

Net interest expenses in 2009 were €10.6 million (€19.4 million in 2008) and consist of exchange rate losses of €1.5 million (€6.3 million in 2008) and net interest expenses of €9.1 million (€13.1 million for the previous year). The decrease in net interest expenses resulted from a reduction in the interest rates applied and a careful management of financial leverage. The company reported an income before taxes of €10.7 million (€53.6 million for 2008). Estimated taxation, calculated based on the tax rates applicable for the year under current tax regulations, amounted to €1.2 million (€17.4 million in 2008), with a tax rate of 10.8% compared to 32.4% of 2008.

The tax rate decreased as the Group companies that posted positive results for the year benefited from tax reliefs and other companies that reported losses prudentially recognised deferred tax assets. The period ended with a net income of €10.5 million. Net debt as of 31 December 2009 decreased by 24.4% to €255.0 million, down by €82.4 million compared to 2008 (€337.4 million) and by €31.4 million compared to 30 September 2009 (€286.4 million). The improvement in net financial position is the result of the steps taken to reduce net working capital and the downsizing of the investment policy in order to react to declining demand.

Results of the Parent Company Brembo S.p.A.

Revenues of the Parent Company Brembo S.p.A. amounted to €459.7 million for 2009, down 28.7% compared to the previous year. Net income amounted to €21.1 million (€16.7 million for 2008). The Shareholders’ Meeting will propose the following distribution of net income:

It will also be proposed that dividends should be paid as of 6 May 2010, excoupon No.18 that will be completed on 3 May 2010.

Director co-opted

During today’s meeting of the Board of Directors, a new Director has been co-opted. Bruno Saita, who has collaborated with the Group for several years, takes up the position of non-executive Director.

Significant Events After Year-End

On 15 January 2010, Brembo Nanjing Foundry Co. Ltd. (100% held by Brembo SpA) and Donghua Automotive Industrial Co. Ltd. (part of the Saic Group, China's top manufacturer of cars and commercial vehicles) finalised agreements for the purchase of foundry plants and equipment. The agreements will strengthen the Brembo Group's presence in China by creating an integrated production centre in Nanjing, including a foundry and a production facility for brake callipers and discs (for cars and commercial vehicles) that will be able to offer the Chinese market braking systems built to meet Brembo's standards of performance, style and comfort.

On 12 March 2010, Brembo announced they will invest € 83 million in the period 2010-2014 on increasing the production capacity of their plant at Dabrowa Gornicza in Poland, which makes brake discs for the cars and commercial vehicles market.

The investment has been prompted by the capture of a growing share in the European brake disc market, which even now is guaranteed to exploit the capacity of the new foundry to the full. The project will be financed with cash generated by the Group, with EIB loan, and in part by a grant from the European Union (€ 13.5 million); the new development also benefits from tax breaks, as part of the Katowice Economic Special Zone.

Outlook

After a year marked by severe difficulties, 2010 is expected to show a growth in market shares in the various segments in which the Group operates, especially thanks to the ongoing internationalisation policy that Brembo has been implementing for some time. The strong cost containment measures taken during 2009 and the partial recovery of demand expected for the year underway should allow the Group to achieve a profitability realignment.

During financial year 2010, the Group is also forecast to go back to a normal level of investments, given the start of the previously announced manufacturing expansion in China and Poland and the increase in production capacity to match expected demand levels