Q1 2009: Net sales growth and weaker order situation

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* Continued high level of investments in research and development
* Turnaround program to boost income

Lübeck - The first quarter has already shown that fiscal year 2009,
as expected, will be a difficult year for Dräger. While net sales
rose by almost 5 percent, order intake and orders on hand - with
strong regional and product-related differences - are still down by
more than 9 percent year on year. "This development confirms our
forecast of an approximately 5 percent decline in net sales for the
current fiscal year", explains Stefan Dräger, Executive Board
Chairman of Drägerwerk Verwaltungs AG. The Group's EBIT before
non-recurring expenses decreased to EUR 6.5 million (Q1 2008:
EUR 17.5 million). As announced, the Company is confronting the weak
earnings development with a turnaround program.

Order intake down year on year
Order intake fell by 9.2 percent (net of currency effects:
9.8 percent) to EUR 448.6 million in the first three months of fiscal
year 2009 (Q1 2008: EUR 493.8 million). Order intake in the medical
division dropped by 7.8 percent to EUR 295.2 million (net of currency
effects: 8.8 percent), while the safety division's order volume
declined by 10.7 percent to EUR 160.1 million (net of currency
effects: 10.6 percent). Compared with the prior-year quarter, orders
on hand fell across the Group by 9.2 percent to EUR 424.5 million
(March 31, 2008: EUR 467.3 million), but are up EUR 24.6 million
compared with December 31, 2008.

Net sales rise in the first quarter
Net sales rose by 4.8 percent (net of currency effects: 3.8 percent)
to EUR 425.2 million in the first three months of 2009 (Q1 2008:
EUR 405.7 million). Both divisions contributed to this rise. While
the medical division's net sales increased by 1.6 percent (net of
currency effects: +0.0 percent) to EUR 268.3 million in the first
three months, the safety division generated net sales growth of
10.4 percent against the prior-year period (net of currency effects:
+10.5 percent), to EUR 163.0 million.

Earnings under pressure
Due to changes in the product mix and currency effects, the gross
margin decreased from 47.3 percent in the first three months of 2008
to 45.4 percent a year later. The higher volume of net sales led to a
proportionately lower increase in gross profit, from EUR 191.8
million to EUR 193.0 million. A 4.5 percent increase in functional
costs compared with the first quarter of 2008 (research and
development costs, marketing and selling expenses, general
administrative expenses and other operating income and expenses)
impacted earnings. On the one hand, this was due to negative currency
effects of EUR 4.2 million, mainly due to the relatively strong
US dollar. On the other hand, a budgeted increase in research and
development costs, which rose to 8.7 percent of net sales (March 31,
2008: 7.3 percent), was responsible for the higher functional costs.
As a result of these effects, the medical division's EBIT before
non-recurring expenses was significantly weaker at EUR 2.7 million
(Q1 2008: EUR 12.1 million). The safety division managed to increase
earnings before interest and taxes by 10.5 percent year on year to
EUR 10.5 million (Q1 2008: EUR 9.5 million). The Group's EBIT before
non-recurring expenses decreased by 62.9 percent to EUR 6.5 million
(Q1 2008: EUR 17.5 million) due in particular to the medical
division's weaker earnings contribution compared with the prior-year
period.
Turnaround program
For 2009, a number of immediate measures should cushion the effects
of the negative margin development and anticipated weak net sales. In
order to strengthen its competitive position in the long term, the
Company plans to cut costs, increase efficiency and boost income
through new products. The group-wide turnaround program therefore
contains measures to grow earnings in all function areas, such as
procurement, production and logistics, marketing and sales, as well
as cross-function fields, such as administration and IT. 150
employees are currently assessing around 400 detailed individual
measures spanning nine modules and 70 sub-projects. "In June we will
unveil the project in detail and implement a carefully coordinated
package of measures", said Stefan Dräger. All expenditure and
structures are being put under the microscope in order to identify
potential for improvement. Growth, product quality and customer
service remain on the agenda.

Outlook
Dräger continues to expect net sales to decline by approximately
5 percent in 2009. Stefan Dräger: "In 2009 we will implement a
decisive set of measures to secure medium-term profitable growth and
regain the trust of the capital market."

Disclaimer
This press release contains forward-looking statements regarding the
future development of the Dräger Group. These forward-looking
statements are based on the current expectations, presumptions, and
forecasts of the Executive Board as well as the information available
to it to date and have been prepared to the best of its knowledge and
belief. No guarantee or liability for the occurrence of the future
developments and results specified can be assumed in respect of such
forward-looking statements. Rather, the future developments and
results are dependent on a number of factors. They entail risks and
uncertainties beyond the Company's control and are based on
assumptions which could prove to be incorrect. Notwithstanding any
legal requirements to adjust forecasts, we assume no obligation to
update the forward-looking statements contained in this report.
Dräger will hold its annual general meeting on May 8, 2009. You will
find all other financial dates on our website at www.draeger.com
under Investor Center/Financial Calendar

Q1 2009 key figures (EUR million)

+-------------------------------------------------------------------+
| | Q1 2009 | Q1 2008 | Change |
|--------------------------------------+---------+---------+--------|
| Order intake | 448.6 | 493.8 | -9.2% |
|--------------------------------------+---------+---------+--------|
| Medical | 295.2 | 320.0 | -7.8% |
|--------------------------------------+---------+---------+--------|
| Safety | 160.1 | 179.3 | -10.7% |
|--------------------------------------+---------+---------+--------|
| | | | |
|--------------------------------------+---------+---------+--------|
| Orders on hand | 424.5 | 467.3 | -9.2% |
|--------------------------------------+---------+---------+--------|
| Medical | 248.7 | 239.6 | +3.8% |
|--------------------------------------+---------+---------+--------|
| Safety | 177.5 | 228.4 | -22.3% |
|--------------------------------------+---------+---------+--------|
| | | | |
|--------------------------------------+---------+---------+--------|
| Net sales | 425.2 | 405.7 | +4.8% |
|--------------------------------------+---------+---------+--------|
| Medical | 268.3 | 264.1 | +1.6% |
|--------------------------------------+---------+---------+--------|
| Safety | 163.0 | 147.6 | +10.4% |
|--------------------------------------+---------+---------+--------|
| | | | |
|--------------------------------------+---------+---------+--------|
| EBIT[1] before non-recurring | | | |
| expenses | 6.5 | 17.5 | -62.9% |
|--------------------------------------+---------+---------+--------|
| Medical | 2.7 | 12.1 | -77.7% |
|--------------------------------------+---------+---------+--------|
| Safety | 10.5 | 9.5 | +10.5% |
|--------------------------------------+---------+---------+--------|
| | | | |
|--------------------------------------+---------+---------+--------|
| Non-recurring expenses | 0.0 | 7.1 | |
|--------------------------------------+---------+---------+--------|
| Net profit | 0.1 | 2.5 | -96.0% |
|--------------------------------------+---------+---------+--------|
| Earnings per preferred share (in ¤) | -0.03 | 0.05 | |
+-------------------------------------------------------------------+

[1] EBIT = Earnings before net interest result and income
taxes

Contact

Corporate Communications:
Burkard Dillig
Tel. +49 451 882-2185
burkard.dillig@draeger.com

Investor Relations:
Vanina Herbst
Tel. +49 451 882-2685
vanina.herbst@draeger.com

Drägerwerk AG & Co. KGaA
Moislinger Allee 53-55
23542 Lübeck, Germany
www.draeger.com

The press release can be downloaded from the following link:

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Drägerwerk AG & Co. KGaA
Moislinger Allee 53-55 Lübeck Germany

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