Neumarkt, June 10, 2011 – On the basis of preliminary and unaudited figures, Pfleiderer AG (ISIN DE0006764749) recorded an increase in consolidated revenue of 8% in 2010 compared with the prior year to 1,493 million euros. Due to high extraordinary expenses for restructuring and impairments of subsidiaries and goodwill, as previously announced, the Group posted a loss for the year (attributable to shareholders of Pfleiderer AG) of 723 million euros (2009: loss of 69.8 million euros).

The loss per share amounted to €12.47 (2009: loss per share of €1.38). Net debt increased to 960 million euros as of December 31, 2010 from 854 million euros a year earlier. Due to the large net loss, equity attributable to Pfleiderer shareholders amounted to minus 301 million euros at the end of the year (December 31, 2010: 343 million euros).

Earnings from operating activities before interest, taxes, depreciation and amortization (EBITDA) for 2010 amounted to 92 million euros, compared with 117.9 million euros in 2009. Taking restructuring expenses into consideration, EBITDA for 2010 amounted to just 40 million euros (2009: 100.4 million euros).

The Group’s earnings before interest and taxes (EBIT) in 2010 were reduced by high extraordinary expenses to minus 583 million euros.

Excluding extraordinary expenses, EBIT amounted to minus 15 million euros. In 2009, EBIT amounted to minus 16.1 million euros, or plus 8.2 million euros after adjusting for extraordinary expenses.

Extraordinary expenses of 568 million euros resulted from impairments of 464 million euros in the North America region, impairments of 27 million euros on non-current assets held for sale, restructuring costs of 61 million euros relating to plant closures and other restructuring costs of 15 million euros.

The net financial expense for 2010 was 79 million euros, compared with a net financial expense of 48.8 million euros in the prior year. The increase was primarily a result of higher financing costs and higher debt.

The preliminary and unaudited figures for the first quarter of 2011 show an increase in Group revenue of approximately 10% to 391 million euros (Q1 2010: 355.6 million euros), mainly due to improved operations in Western Europe. EBITDA amounts to 20 million euros, compared with 22.2 million euros in the first quarter of last year.

The financial statements for the year 2010 have already been reviewed by the external auditors but an audit opinion can only be issued when the continuation of Pfleiderer as a going concern has been decided upon, i.e. when the financial restructuring has been approved with the require majorities by the bondholders’ meeting and the shareholders’ meeting and is then implemented. The figures may change by the time of the final audit and the issue of the audit opinion.

Contact persons:
Analysts/Investors Press
Lothar Sindel
Vice President Investor Relations
Pfleiderer AG
Tel.: +49 (0) 91 81 - 28-80 44
Fax: +49 (0) 91 81 - 28-6 06
E-Mail: lothar.sindel@pfleiderer.com

Furthermore, the creditors will provide Pfleiderer with an additional credit line of 100 million euros in May 2011 in the form of a first-lien secured loan (“super senior”). Half of the super senior loan is to be repaid after the capital changes have been carried out.

The Executive Board and the Supervisory Board will recommend to the shareholders at an extraordinary shareholders’ meeting, which will probably be held in the second half of July 2011, that a massive capital reduction be carried out in a magnitude that will result in the shareholders holding initially only approximately 1 percent of Pfleiderer’s share capital. As part of the capital increase they can increase their stake to up to 16%. In order to regain a sound equity base, a capital increase will then be carried out against cash contributions in which funds of up to 100 million euros are to be raised. Of that total, 60 million euros is to be contributed by the creditors and 40 million euros is to be contributed by the shareholders of Pfleiderer AG or by other third parties. The creditors are also prepared to provide a further first-lien loan (“super senior”) in the amount of that portion of the capital increase of up to 40 million euros that is not contributed by the shareholders or other third parties, so that the planned cash inflow of 100 million euros is in any case guaranteed.

When the capital increase is completed, the creditors are to hold at least 80 percent of the increased share capital of Pfleiderer AG. This proportion may increase to the extent that existing old shareholders or third parties do not subscribe to the shares allocated to them in the capital increase. The majority shareholding reflects the significant waiver of receivables and the guarantee of the cash inflow through the super-senior loan of up to 40 million euros. The shareholders can increase their stake in the company’s share capital by up to 15 percent from 1 percent to up to 16 percent by subscribing to the portion of the capital increase which is assigned to them against cash contributions of up to 40 million euros. The holders of the hybrid bond issued in 2007 with a nominal volume of 275 million euros are to fully waive their rights and in return will hold 4 percent of the company’s share capital after the capital increase. Including the accrued unpaid interest, this amounts to further debt relief of approximately 340 million euros.

Those creditors that waive 40 percent of their receivables but do not wish to participate in the capital increase will receive bonds with warrants that can be converted into shares under certain conditions.

The creditors have made the planned debt relief subject to the condition that both the bondholders and the shareholders agree to the steps to be taken without any qualifications in separate meetings. The measures described above will lead to a significant reduction in the Pfleiderer Group’s debt and to the restoration of a sound equity base.

Contacts:
Analysts/Investors
Lothar Sindel
Vice President Investor Relations
Pfleiderer AG
Tel.: +49 (0) 91 81 - 28-80 44
Fax: +49 (0) 91 81 - 28-6 06
E-mail: lothar.sindel@pfleiderer.com

It is planned that the creditors will waive their claim to a part of their financial receivables (excluding the Eastern Europe financing group) equal to 40 percent of the respective utilized credit lines, plus part of the accrued interest and fees.

Furthermore, the creditors will provide Pfleiderer with an additional credit line of 100 million euros in May 2011 in the form of a first-lien secured loan (“super senior”). Half of the super senior loan is to be repaid after the capital changes have been carried out.

The Executive Board and the Supervisory Board will recommend to the shareholders at an extraordinary shareholders’ meeting, which will probably be held in the second half of July 2011, that a massive capital reduction be carried out in a magnitude that will result in the shareholders holding only approximately 1% of Pfleiderer’s shares after the other capital changes. In order to regain a sound equity base, a capital increase will then be carried out against cash contributions in which funds of up to 100 million euros are to be raised. Of that total, 60 million euros is to be contributed by the creditors and 40 million euros is to be contributed by the shareholders of Pfleiderer AG or by other third parties. The creditors are also prepared to provide a further first-lien loan (“super senior”) in the amount of that portion of the capital increase of up to 40 million euros that is not contributed by the shareholders or other third parties, so that the planned cash inflow of 100 million euros is in any case guaranteed.

When the capital increase is completed, the creditors are to hold at least 80 percent of the increased share capital of Pfleiderer AG. This proportion may be higher if neither the existing old shareholders nor third parties subscribe to the shares allocated to them in the capital increase. The majority shareholding reflects the significant waiver of receivables and the guarantee of the cash inflow through the super-senior loan of up to 40 million euros. The shareholders can increase their stake in the company’s share capital by subscribing to the portion of the capital increase which is assigned to them against cash contributions of up to 40 million euros by up to 15 percent from 1 percent to up to 16 percent. The holders of the hybrid bond issued in 2007 with a nominal volume of 275 million euros are to fully waive their rights and in return will hold 4 percent of the company’s share capital after the capital increase.

Those creditors that waive 40 percent of their receivables but do not wish to participate in the capital increase will receive bonds with warrants that can be converted into shares under certain conditions.

All details are still preliminary and subject to the creditors’ approval and the signing of the respective agreements, which is anticipated for the middle of May 2011. Pfleiderer cannot preclude the possibility of changes in the draft agreements because they are now being reviewed by the various banks and other creditors. The implementation of the restructuring concept also requires the approval of the holders of the hybrid bonds and the shareholders, and certain other conditions must be fulfilled. The restructuring is also intended to lead to a substantial reduction in the Pfleiderer Group’s debt and to the restoration of an adequate equity base.

Contacts:

Analysts/Investors
Lothar Sindel
Vice President Investor Relations
Pfleiderer AG
Tel.: +49 (0) 91 81 - 28-80 44
Fax: +49 (0) 91 81 - 28-6 06
E-mail: lothar.sindel@pfleiderer.com

Journalists
Frank Elsner
Frank Elsner Kommunikation für Unternehmen GmbH
Tel.: + 49 (0) 54 04 – 9192-0
Fax: + 49 (0) 54 04 – 9192-29
E-mail: office@elsner-kommunikation.de

The restructuring concept aims to achieve a significant reduction in the Pfleiderer Group’s debt and a return to an appropriate and sound equity base. It stipulates that Pfleiderer AG will receive further loans of 100 million euros from the banks and funds involved, which will secure the Group’s financing while it implements its financial restructuring.

The concept’s key points include a contribution from the banks and other creditors in the form of the waiver of a significant proportion of their credit receivables. The hybrid bond of Pfleiderer AG, which is classified as equity, is to be exchanged after being cut for a minority equity interest in the company. The package also calls for a massive reduction in share capital followed by a capital increase in which the creditors can participate and acquire a majority stake. In this way, the company is to receive a cash injection of 100 million euros. The existing shareholders of Pfleiderer AG are to receive subscription rights for a small part of the targeted capital increase. In addition, the issue of an option bond is also planned. The exact details of the capital measures that the company will recommend have not yet been decided upon.

The implementation of the concept is subject to the legal conclusion of the relevant agreements, the approval of the company’s Annual Shareholders’ Meeting for the planned capital measures, and the approval of the holders of the hybrid bond.

Following the successful completion of negotiations with the creditors on the restructuring concept and the key points of the financing, Mr. Ernst Pelzer has decided to take on a new position outside the Pfleiderer Group. He has therefore resigned from the Executive Board of Pfleiderer AG as of March 31, 2011.

Hanno C. Fiedler, Chairman of the Supervisory Board: “Through his activities, Mr. Pelzer has made a significant contribution to the operational and financial restructuring of the Pfleiderer Group. We thank Mr. Pelzer for his great commitment and his successful efforts for our company.”

The Executive Board of Pfleiderer Aktiengesellschaft

Contact:
Pfleiderer AG, Neumarkt
Lothar Sindel
Head of Investor Relations
Tel.: + 49 (0)9181 28 8044
Fax: + 49 (0)9181 28 606
E-mail: lothar.sindel@pfleiderer.com

Part of the agreement is that Pfleiderer AG will receive further loans of 100 million euros from the involved banks and hedge funds. This will secure the Group’s financing while it implements the financial restructuring. The standstill agreement with the banks, which includes the suspension of regular loan repayments and is initially limited until March 31 2011, is to be extended until April 30, 2011. This will give the parties to the agreement enough time for the contractual implementation of the key points agreed upon today.

Contact:
Pfleiderer AG, Neumarkt
Lothar Sindel
Head of Investor Relations
Tel.: + 49 (0)9181 28 8044
Fax: + 49 (0)9181 28 606
E-mail: lothar.sindel@pfleiderer.com

The final loss for the year 2010 has not yet been determined.

Pursuant to Section 92 Subsection 1 of the German Stock Corporation Act (AktG), a reduction in a company’s share capital by more than half triggers a statutory disclosure duty and the convening without delay of an extraordinary meeting of the shareholders. The extraordinary shareholders’ meeting serves to fulfill company’s statutory disclosure duty.

Pfleiderer AG is currently holding constructive discussions with its banks on a new financing framework. The standstill agreement with the company’s banks is not affected by the disclosure pursuant to Paragraph 92 of the AktG.

In financial year 2010, the Pfleiderer Group achieved revenue growth of 8% compared with the prior year. The restructuring measures already taken are showing the first positive effects. In terms of both values and time, they are in line with the planning communicated on November 11, 2010. At the beginning of 2011, significant increases in prices of raw particleboard as well as surface-finished panels were successfully implemented, thus laying the foundations for a sustained improvement in the company’s profit margins.

The Executive Board of Pfleiderer Aktiengesellschaft

Contact:
Pfleiderer AG
Lothar Sindel
Head of Investor Relations
Tel.: + 49 (0)9181 28 8044
Fax: + 49 (0)9181 28 606
E-mail: lothar.sindel@pfleiderer.com

Pfleiderer AG will apply for a court appointment of replacement members of its Supervisory Board without delay.

The Executive Board of Pfleiderer

Contact:
Pfleiderer AG, Neumarkt
Lothar Sindel
Head of Investor Relations
Tel.: + 49 (0)9181 28 8044
Fax: + 49 (0)9181 28 606
E-mail: lothar.sindel@pfleiderer.com