Press Releases 2005


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	Press Releases

May 02, 2005

SGL Carbon Divests IT Operations to Thales

Key Component of Worldwide Administrative Cost-Cutting Program implemented
Over € 10 Million Reduction in IT Expenses over Next Five Years

Wiesbaden, May 2, 2005. Within the framework of its administrative cost-cutting program, which SGL Carbon announced in November, 2004, the Company recently divested its major IT operations to Thales Information Systems GmbH in Siegburg. The two parties agreed not to disclose the purchase price. SGL Carbon will save € 10 million in IT costs over the next five years due to this sale plus additional outsourcing measures.

As a result of this sale, all the human resource capacities that had been built up and allocated for the Company’s IT harmonization have been adjusted to meet customary IT business requirements once again. The IT staff that is now required are remaining with the Company; where they have already been integrated within the reorganized IT unit. The new organization resulted in a IT headcount reduction of nearly 15 employees. In addition to all the SAP development activity that is being outsourced as a result of the sale, Thales will also provide specialized IT infrastructure services for SGL Carbon within the framework of an outsourcing agreement.

At an expense of nearly € 20 million, in 2002/2003 SGL Carbon replaced its historically inherited, 15 different IT systems with a uniform SAP platform. The uniform IT environment now in place throughout the Company makes it possible to realize both short-term and medium-term synergies in worldwide administrative processes. This is causing a continual reduction in the number of jobs required for administrative functions. A total of 50 job positions were eliminated in 2004, with a further reduction by nearly 90 in 2005 and the remainder to follow in 2006. The focus of attention of the worldwide administrative cost-cutting program, which was introduced in November 2004, is on IT, on accounting, and on human resource administration. Beginning in 2006, the Company intends to generate annually savings of approximately € 11 million through the streamlining of processes and the elimination of nearly 150 job positions. The restructuring outlays necessary for the overall cost-reduction program total between € 5 and € 6 million. Of this amount, € 3.5 million was already dispersed in 2004.

Forward-looking statements:
This document contains statements on future developments that are based on currently available information and that involve risks and uncertainties that could lead to actual results deviating from these forward-looking statements. These risks and uncertainties include, for example, unforeseeable changes in political, economic and business conditions, particularly in the area of electrosteel production, the competitive situation, interest rate and currency developments, technological developments and other risks and unanticipated circumstances. We see other risks in price developments, unexpected developments relating to acquired and consolidated companies, ongoing restructuring measures and unforeseeable occurrences in conjunction with the reviews to be performed by the European antitrust authorities. SGL Carbon does not intend to update these forward-looking statements.