Half-year results 2009

HALF YEAR REPORT

- 2 -

p Sales: for the fi rst half of 2009 the group posted consoli-

dated sales of EUR 136.5 million, compared with EUR 196.2

million during the same period last year.

p Gross margin: the total gross margin improved slight-

ly compared with 2008. A small change in sales mix and a

sharp fall in raw materials prices during the last quarter of

2008 are the main causes.

p Services and other goods: targeted eff orts

produced here a cost saving of EUR 9.4 million in the fi rst

half of 2009 compared with the same period in 2008

(EUR 20.9 million vs. EUR 30.3 million) This savings falls

into three parts: fi rst there are volume-related costs which

evolve directly in line with sales. Second there are the

general non-volume-related costs, where all non-vital

expenditure has been eliminated. Finally there are the

costs of temporary labour (recorded under this heading)

which fell sharply.

p Personnel costs: personnel costs during the fi rst half

of 2009 amounted to EUR 32.7 million compared with

EUR 37.6 million over the same period last year. Market

conditions forced the group to reduce production capacity

(mainly in Belgium, France and Poland) and to use the

system of economic unemployment (Belgium, Netherlands,

Germany) in order to regain a balance between personnel

expenditure and income (sales).

p Other operating costs: these consist mainly of a

number of non-profi t-related taxes (property tax, taxe

professionnelle, etc.), which become more onerous from

year to year.

p Non-recurrent result: the non-recurrent result

amounted in the fi rst half of 2009 to EUR 956 thousand.

This consists of a (limited) recognition of an impairment

and additional provisions for ongoing restructuring.

p Operating result: all this resulted in an operating

profi t of EUR 3.6 million compared with 18.8 million over

the same period last year.

p Financial result: fi nancial result for the fi rst half

of 2009 amounted to EUR -2.5 million compared with

- 4.4 million during the same period last year. Unrealized

foreign exchange gains and lower interest charges due to

reduced working capital are the two main causes.

p Profit: the profi t for the fi rst half of 2009 amounted to

EUR 533 thousand compared with EUR 9.5 million over the

same period last year.

p Net operating cash flow: for the past half year

amounted to EUR 10.1 million.

HALF YEAR REPORT OF THE BOARD OF DIRECTORS

- 3 -

DEVELOPMENTS BY DIVISION

COATING DIVISIONThe Coating division specializes in the integrated coating of

technical textiles, of which it masters the entire production

process: extrusion of the technical yarns, weaving of the

technical fabric and its coating with various polymers. The

group is the only player in the world to master fi ve diff erent

coating techniques, each with its own specifi c products and

markets.

SPINNING AND WEAVING

In the spinning mill we extrude polyester granules into tech-

nical yarns. The development and production of customized

products have enabled the company to successfully enter a

number of new markets (geotextiles, conveyor belts, etc.).

This strategy of diff erentiation and focused development

provides the foundation for future growth in various sectors.

The weaving mills, producing mainly for internal use, follow

the trend of the direct coated products. Again, targeted

development and diff erentiation are the keys to current and

future success (e.g. development of tea bags).

DIRECT COATING

The transportation market, which is the main outlet for

direct coated products, remains very weak. Trailer and truck

manufacturers have seen their turnover decrease to halve.

The company has been able, if only in part, to counter this

trend by focusing more on product development for niche

markets (e.g. biogas containers). Although these eff orts

are starting to pay off , they cannot immediately off set the

decline in volume in the group’s primary markets. The other

existing markets (textile architecture, advertising banners,

etc.) are also suff ering, although to a much lesser extent.

Development of a product range for various niche markets

will guarantee balanced revenue distribution and future

growth.

TRANSFER COATING

Transfer coating is a technology consisting of applying a

breathable PU protective layer (coating) onto a medium (fab-

ric, knitwear ...). This technology (in all its variants) has a wide

range of industrial applications (protective clothing, mattress

covers, coating of airbags, fi lms for the automotive market,

etc.) which temper the eff ects of the current recession.

Customer focus, rigorous cost control and small and fl exible

structures are other success factors in these activities.

- 4 -

ONLINE COATING

In this coating technology, the cloth (open structure fabric)

passes directly from the loom into the coating bath. This

technology is used mainly for geogrids, swimming pool

covers, reinforcement nets, windbreak nets, fi lter

reinforcement, etc. The fi rst half of 2009 saw a sharp drop

in deliveries to roofi ng and swimming pool liner producers,

due to a decline in activity in the construction industry

(industrial building) and the fall in ‘luxury’ investments like

private pools. Modern and effi cient machinery makes the

division well-placed to take full advantage of new market

developments as soon as there is the slightest economic

revival.

EXTRUSION COATING

In extrusion coating, we extrude granules on the line itself

and lay this fi lm on diff erent carriers (textile, felt, paper, ...).

The main applications are ventilation tubes, pond liners,

transparent fi lms for greenhouses, fabric for sewer renova-

tion, etc.

CALENDERING

Calendering is a technique used for the production of

industrial fi lms (pond liners, pool liners, etc.). The start-

up phase of this plant is fully behind us. The company is

focusing on a number of promising markets (fi lms for the

automotive industry, technical fi lms, etc.). Here again,

we are placing emphasis on developing products with

customer-specifi c features.

COATING DIVISIE

- 5 -

APPAREL DIVISION

This division stands for ‘technical protective clothing’.

Attention to customer needs, strong quality consciousness

and continuing research and development, combined with

technically advanced products, are the basis of the successful

development of this division.

TECHNICAL PROTECTIVE CLOTHING

The Apparel division operates in almost all economic sectors

(industry, agriculture, services) with a full range of products

tailored to the needs of diff erent sectors in diff erent

countries. Thanks to this strategy the eff ects of the recession

have remained relatively limited.

SPECIFIC MARKETS

The choice made a few years ago to invest in developing

specialized protective clothing for specifi c markets is bearing

fruit. In these markets (fi re fi ghters clothing, maritime survival

suits, bullet-proof vests, etc.), technical requirements have

absolute priority, making these markets less susceptible to

economic cycles.

LEISURE CLOTHING

With further development and diversifi cation of the customer

portfolio, the company was able to increase sales in these

markets (ski suits, sailing gear, etc.).

- 6 -

CHEMICALS DIVISION

Sioen Chemicals processes basic raw materials (PVC powders,

pigments, etc.) into high quality technical semi-fi nished

products (pigment pastes, UV inks, varnishes, dispersions,

fl ame retardant products, etc.) for a whole range of

applications. An activity that was formerly limited to the

production of raw materials for internal use is now a separate

division within the Sioen Industries group with fast-growing

external sales. Thanks to a number of targeted acquisitions (in

2007), the chemicals division has successfully diversifi ed into

diff erent geographic and product technical markets.

This division too has felt the recession in the transport and

automotive sector, in particular in the paste activity. This

decline is tempered by its winning market share in the

wallpaper market and by the stable behaviour of the paint

sector.

- 7 -

INDUSTRIAL APPLICATIONS DIVISION

This division processes coated fabrics and PVC fi lms for

heavy-duty applications. The decline in the automotive and

transportation industry has had an immediate and heavy

impact on this division’s results.

Indeed, the major part of the turnover of the Industrial

Applications division consists of laser cutting of airbags and

interior components for the automotive industry and the

manufacture of tarpaulins, roofs and side curtains for trailers.

TRANSPORTATION

Under this heading the group produces trailers, container and

railway curtains and tarpaulins. The transportation market

(trailers, trucks, etc.) has been particularly aff ected by the

global economic downturn. Trailer and truck manufacturers

have seen their turnover decrease by halve.

INDUSTRIAL ACTIVITIES

In the non-wovens department and in other industrial

activities, attractive results have been achieved in the given

circumstances. Last year we invested in a new cutting

machine and built a new production hall to make welding

and cutting of pond liner even more effi cient.

- 8 -

BALANCE SHEET AND CASH FLOW STATEMENTIn nominal amounts, working capital declined from EUR

126.2 million at 31 December 2008 to EUR 110.0 million

at 30 June 2009. Given the sales trend, working capital

requirements, expressed as percentage of sales, increased

from 36.1% to 40.3%. Net fi nancial debt fell from EUR

151.6 million at 31 December 2008 to EUR 134.5 million at

30 June 2009.

The above movements, especially the reduction in work-

ing capital and the sharp reduction in short-term fi nancial

liabilities, explain the net cash fl ow of EUR -2.1 million euro

between 31 December 2008 and 30 June 2009. The cash

fl ow related to investing activities is rather small (EUR - 3.0

million compared with EUR -6.7 million over the same period

last year).

OUTLOOK In the current macro-economic conditions it is diffi cult to

look ahead and we keep the guidance published earlier this

year. We are continuing to work hard to defend our market

position and to keep costs under rigorous control. We are

closely following all new developments in our markets and

are confi dent that, with our fl exibility and our fi nancial and

shareholder structure, we will emerge stronger from this

period.

MANAGEMENT STATEMENTObligations to provide periodic information under the Trans-

parency Directive eff ective from 1 January 2008

The undersigned declare that:

- The half-year accounts, prepared in accordance with the

applicable standards for annual fi nancial statements, give

a true and fair view of the net assets, fi nancial condition

and results of Sioen Industries and the companies

included in the consolidation.

- The half-year report gives a true and fair overview of

the development and results of the company and the

position of Sioen Industries and the companies included

in the consolidation, and a description of the principal

risks and uncertainties that they face.

Michèle Sioen, CEO

Geert Asselman, CFO

The full fi nancial report with the management statement

will be available from 28 August 2009 in the ‘Investor Rela-

tions’ section of our website www.sioen.com.

- 9 -

INTERIM CONSOLIDATED FINANCIAL STATEMENTS FOR THE 6 MONTHS ENDED 30 JUNE 2009 UNAUDITED

CONTENT

> Condensed consolidated statement of fi nancial position 10

> Condensed consolidated statement of comprehensive income by function and earnings per share 12/13

> Condensed consolidated statement of comprehensive income by nature 14

> Condensed consolidated statement of changes in equity 15

> Condensed consolidated statement of cash fl ows 16

> Notes to the condensed consolidated fi nancial statements 17

- 10 -

CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION

IN THOUSANDS OF EUROS

ASSETS 30/06/2009 31/12/2008

unaudited audited

NON-CURRENT ASSETS

Intangible assets 16 597 17 908

Goodwill 17 596 17 603

Property, plant and equipment 148 082 151 160

Interests in associates 2 2

Long term trade receivables 17 17

Other long term assets 1 237 1 345

Deferred tax assets 3 982 3 846

TOTAL NON-CURRENT ASSETS 187 515 191 881

CURRENT ASSETS

Inventories 91 381 99 183

Trade receivables 56 209 56 107

Other receivables 3 707 8 445

Other fi nancial assets 288 288

Cash and cash equivalents 12 471 14 545

Deferred charges and accrued income 1 430 1 292

TOTAL CURRENT ASSETS 165 486 179 860

TOTAL ASSETS 353 001 371 741

six months ended twelve months ended

- 11 -

EQUITY & LIABILITIES 30/06/2009 31/12/2008

unaudited audited

CAPITAL AND RESERVES

Share capital 46 000 46 000

Retained earnings 94 362 95 541

Hedging and translation reserves 517 820

Minority interests 0 0

TOTAL EQUITY 140 879 142 361

NON-CURRENT LIABILITIES

Borrowings 101 102 102 140

Provisions 1 630 1 493

Retirement benefi t obligation 1 057 1 103

Deferred tax liabilities 14 729 16 410

Obligations under fi nance leases 20 767 18 645

Other amounts payable 3 3

TOTAL NON CURRENT LIABILITIES 139 288 139 794

CURRENT LIABILITIES

Trade and other payables 25 571 24 381

Borrowings 23 168 43 361

Provisions 3 369 3 796

Retirement benefi t obligation 39 39

Current income tax liabilities 2 365 954

Social debts 9 151 9 573

Other amounts payable 2 204 2 250

Obligations under fi nance leases 4 661 3 861

Accrued charges and deferred income 2 304 1 371

TOTAL CURRENT LIABILITIES 72 834 89 586

TOTAL EQUITY AND LIABILITIES 353 001 371 741

six months ended twelve months ended

- 12 -

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

BY FUNCTION | IN THOUSANDS OF EUROS

2009 2008

unaudited unaudited

Net sales 136 518 196 174

Cost of sales -109 753 -150 282

Manufacturing contribution 26 766 45 892

Sales and marketing expenses -9 061 -9 471

R&D expenses -2 939 -3 813

Administrative expenses -12 135 -12 218

Other income/other expenses 1 954 928

Financial income 5 745 2 454

Financial charges -8 214 -6 825

Non recurring result (1) -956 -2 545

Profi t (loss) before tax 1 160 14 402

Income tax -627 -4 952

Profi t (loss) for the period from continuing operations 533 9 450

Profi t (loss) for the period from discontinued operations 0 0

Group profi t/loss 533 9 450

Group profi t/loss attributable to shareholders of Sioen Industries 533 9 450

Group profi t/loss attributable to minority interests 0 0

Group profi t/loss 533 9 450

Other comprehensive income for the period:

Exchange differences arising on translation of foreign operations -360 -157

Income tax relating to components of other comprehensive income 123 53

Other comprehensive income for the period (net of tax) -238 -104

TOTAL COMPREHENSIVE INCOME FOR THE PERIOD 295 9 346

Attributable to shareholders of Sioen Industries 295 9 346

Attributable to minority interests 0 0

(1) Non-recurring result relates to impairment losses, restructuring expenses and start-up costs of new, signifi cant investment projects until the product is ready to be sold at normal market conditions.

six months ended on June 30

- 13 -

EARNINGS PER SHARE

Earnings (loss) per share 2009 2008

in euros unaudited unaudited

Basic earnings per share 0.02 0.44

From continuing operations 0.02 0.44

From discontinued operations 0.00 0.00

Diluted earnings per share 0.02 0.44

From continuing operations 0.02 0.44

From discontinued operations 0.00 0.00


- 14 -

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

BY NATURE | IN THOUSANDS OF EUROS

2009 % on net 2008 % on net unaudited sales unaudited sales Net sales 136 518 196 174 Changes in stocks and WIP (Work in Progress) -5 316 -3.9% 7 063 3.6% Other operating income (2) 2 001 1.5% 2 078 1.1%

Raw materials & consumables used -60 282 44.2% -102 125 52.1%

Gross margin 51.95% 51.54% Services and other goods -20 915 15.3% -30 267 15.4% Remuneration, social security and pensions -32 713 24.0% -37 571 19.2% Depreciations -10 407 7.6% -10 732 5.5% Write off inventories and receivables -760 0.6% -222 0.1% Other operating charges (3) -3 540 2.6% -3 081 -1.6% Non recurring result (1) -956 0.7% -2 545 -1.3%

Operating result 3 629 2.7% 18 773 9.6%

Financial result -2 469 -1.8% -4 371 -2.2% Financial income 5 745 4.2% 2 454 1.3% Financial charges -8 214 6.0% -6 825 3.5%

Profi t or loss before taxes 1 160 0.8% 14 402 7.3%

Income tax -627 0.5% -4 952 2.5%

Profi t or loss after taxes 533 0.4% 9 450 4.8%

Minority interests 0 0.0% 0 0.0%

Group profi t/loss 533 0.4% 9 450 4.8%

Other comprehensive income for the period: Exchange differences arising on translation of foreign operations -360 -157 Income tax relating to components of other comprehensive income 123 53

Other comprehensive income for the period (net of tax) -238 -104

Total comprehensive income for the period 295 9 346

Attributable to shareholders of Sioen Industries 295 9 346 Attributable to minority interests 0 0

EBIT 3 629 2.7% 18 773 9.6%

EBITDA 14 984 11.0% 29 678 15.1%

OPERATING CASH FLOW 10 069 7.4% 19 849 10.1%

(1) Non-recuring result relates to impairment losses, restructuring expenses and start-up costs of new, signifi cant investment projects until the product is ready to be sold at normal market conditions

(2) Other operating income mainly consists of received rent for buildings, transport recharges and received indemnities(3) Other operating charges mainly consist of taxes on tangible assets, local taxes and import duties


- 15 -

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY


six months ended 30/06/2009

Balance at January 1 2009 46 000 95 541 125 695 142 361 0 142 361

Group profi t/loss 533 533 0 533

Available for sale fi nancial assets

Hedging

Deferred tax 0 0 0

Currency translation adjustments -303 -303 0 -303

Change in consolidation scope

Transfer to profi t on cash fl ow hedges

Total comprehensive income for het period 0 0 -303 0 -303 0 -303

Payment of dividends -1 711 -1 711 0 -1 711

Balance at June 30 2009 46 000 94 362 -178 695 140 879 0 140 879

six months ended 30/06/2008

Balance at January 1 2008 46 000 101 761 66 758 148 585 0 148 585

Group profi t/loss 9 450 9 450 0 9 450

Available for sale fi nancial assets

Hedging

Deferred tax 103 103 0 103

Currency translation adjustments 1 1 0 1

Change in consolidation scope

Transfer to profi t on cash fl ow hedges -111 -111 0 -111

Total comprehensive income for het period 0 0 1 -7 -6 0 -6

Payment of dividends -9 626 -9 626 0 -9 626

Balance at June 30 2008 46 000 101 585 67 751 148 402 0 148 402

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- 16 -

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS


For the six months ended June 30

2009 2008

Unaudited

Operating result 3 629 18 773

Depreciations 10 407 10 732

Impairment 261 0

Write off inventories and receivables 760 222

Provision other risks and charges -1 017 107

Details working capital:

Inventories 91 381 103 522

Long term and short term trade receivables 56 226 78 880

Other receivables, non-current assets, investments & deferred charges 6 661 11 379

Trade and other payables -25 571 -39 883

Tax liabilities & other amounts payable -18 481 -21 712

Amounts written off inventories and receivables 12 746 12 543

Total working capital 122 961 144 729

Changes in working capital 16 231 -6 203

Cash fl ow from operating activities 30 271 23 631

Current taxes -1 007 -5 457

Net cash fl ow from operating activities 29 264 18 174

Received interests 37 44

Acquisitions of subsidiaries 0 0

Investments in intangible and tangible fi xed assets -3 311 -7 740

Disposal and sale of intangible and tangible fi xed assets 638 1 102

Increase in capital grants 0 0

Translation adjustments on intangible and tangible assets -374 -140

Net cash fl ow from investing activities -3 010 -6 734

Net cash fl ow before fi nancing activities 26 254 11 440

Paid interests -3 368 -3 614

Disbursed dividend -1 762 -9 626

Increase long term interest bearing loans 0 0

Decrease long term interest bearing loans -1 039 -5 192

Increase/(decrease) short term intrest bearing loans -20 192 7 041

Increase/(decrease) fi nance lease obligations -1 271 -567

Other -157 337

Currency result -242 -896

Cash fl ow from fi nancing activities -28 031 -12 516

Impact of cumulative translation adjustments and hedging -296 -6

Change in cash and cash equivalents -2 074 -1 082

Net cash position at the end of previous period 14 545 7 479

Net cash position at the end of current period 12 471 6 397

- 17 -

REPORTING ENTITY

The condensed consolidated interim fi nancial statements

of Sioen Industries NV (the ‘Company’) include the fi nancial

statements of the Company and its subsidiaries (together

referred to as the ‘Group’).

The consolidated interim fi nancial statements give a general

overview of the Group’s activities and the results obtained.

They give an accurate picture of the entity’s fi nancial posi-

tion, fi nancial performance and cash fl ow, and are drawn up

on a going concern basis.

The consolidated interim fi nancial statements are stated

in thousands of euros, as the euro is the currency of the

primary economic environment in which the Group is active.

The condensed fi nancial statements of foreign participations

are converted in accordance with the principles described in

the section ‘Foreign currencies’ of the annual report 2008.

STATEMENT OF COMPLIANCE WITH IFRS

These condensed interim consolidated fi nancial statements

are for the six months ended 30 June 2009. They have been

prepared in accordance with International Accounting

Standard (IAS) 34 Interim Financial Reporting.

The condensed interim consolidated fi nancial statements do

not include all of the information required in annual fi nan-

cial statements in accordance with IFRS, and should be read

in conjunction with the consolidated fi nancial statements of

the Group for the year ended 31 December 2008.

SIGNIFICANT ACCOUNTING POLICIES

These condensed consolidated interim fi nancial statements

have been prepared in accordance with the accounting

policies adopted in the last annual fi nancial statements for

the year to 31 December 2008. The following standards and

interpretations revised or newly published by the IASB were

mandatory as of the beginning of fi nancial year 2009:

- Amendments to IAS 1: Presentation of Financial Statements

The revised Standard has introduced a number of

terminology changes (including revised titles for the

condensed fi nancial statements) and has resulted in a

number of changes in presentation and disclosure. Ac-

cordingly, a consolidated statement of comprehensive

income is now presented, and the statement of changes

in equity is shown as a separate element of the fi nancial

statements. The statement of comprehensive income

comprises the consolidated profi t and loss and the other

income, which corresponds to income and expenses

directly recognised in equity.

- IFRS 8 Operating Segments

The adoption of IFRS 8 has not aff ected the identifi ed

operating segments for the Group. Reported segment

results are based on internal management reporting in-

formation that is regularly reviewed by the chief operat-

ing decision maker (management approach).

- Amendments to IAS 23: Borrowing Costs

The amendments to IAS 23 now requiring capitalisation

of borrowing costs do not impact the fi nancial position

and fi nancial performance since the Group already

exercised the previous option of capitalising borrowing

costs.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

- 18 -

- IFRIC 13: Customer Loyalty Programmes

- Amendments to IFRS 2: Share-based Payment

- Amendments to IAS 32: Financial instruments: Presenta-

tion

The mandatory application of all other amendments to or

improvements of standards and interpretations listed above

did not give rise to any major eff ects on the Group’s fi nancial

position and fi nancial performance.

The accounting policies have been applied consistently

throughout the Group for the purposes of preparation of

these condensed consolidated interim fi nancial statements.

SEASONALITY OF INTERIM OPERATIONS

The consolidated income statement of the continuing op-

erations used to refl ect the seasonality of the coating busi-

ness, as a result of which positive earnings were primarily

generated in the fi rst and second quarter of any one year.

However, the apparel division (textile business), of which

sales remain at level and positive earnings are primarily

generated in the third and fourth quarter of any one year,

has become more signifi cant within the Group.

SIGNIFICANT EVENTS

The world economy has worsened since the last quarter of

the last annual reporting period. As with all businesses, the

Group is aff ected by the economic strains this is putting on

investments. The Group’s objectives and policies for manag-

ing capital, credit risk and liquidity risk are described in its

recent annual fi nancial statements.

The Group’s management believes that the Group is well

positioned in the current economic circumstances. Factors

contributing to the Group’s strong position are:

- The Group does not expect to need additional borrowing

facilities in the next 12 months, as a result of its signifi -

cant fi nancial resources, existing facilities and strong

liquidity reserves.

The Group has no debt covenants to comply with.

- The Group’s major customers have not experienced fi nan-

cial diffi culties. Credit quality of trade receivables as at 30

June 2009 is considered to be good.

Overall, the Group is in a strong position despite the current

economic environment, and has suffi cient capital and liquid-

ity to service its operating activities and debt.

ASSESSMENT CRITERIA IN THE APPLICATION

OF THE VALUATION RULES

In the application of the valuation rules, in certain cases an

accounting assessment must be made. This assessment is

done by making the most accurate assessment possible of

uncertain future evolutions. The management determines

its assessment on the basis of diff erent realistically assessed

parameters, such as future market expectations, sector

growth rates, industry studies, economic realities, budgets

and multi-year plans, expected profi tability studies, etc. The

most important elements within the Group that are subject

to this are: impairments, provisions and deferred tax items.

- 19 -

Impairment test for the six months ended June 30 2009

In order to provide the stakeholders with in-depth know-

ledge as to the fi nancial strenght of the Group, we reas-

sessed the recoverable amount of assets. Based on the

sensitivity analysis, a signifi cant adverse change in key

assumptions could result in an impairment loss to be rec-

ognized in the Roland subdivision as the discounted cash

fl ow exceeded the carrying value only moderately. Develop-

ments during the fi rst half of 2009 within this subdivision

were below previous estimated levels, resulting in a lower

recoverable amount in relation to the carrying amount of

the assets. Estimates based on the latest developments

resulted in an impairment loss, amounting to € 0.3 million,

which was recognized as per 30 June 2009 on assets of the

Roland subdivision, part of the industrial applications divi-

sion.

Key assumptions related to all other divisions of the Group,

as described in our annual report of 2008, are still valid and

review based on the latest developments did not result in

any adverse changes. There are no impairment indicators

during the fi rst half of the year related to these divisions.

SEGMENT INFORMATION

The Group has adopted IFRS 8 Operating Segments. In

identifying its operating segments, management gener-

ally follows the Group’s service lines, which represent the

main products and services provided by the Group. Each of

these operating segments is managed separately as each of

these service lines requires diff erent technologies and other

resources as well as marketing approaches.

The adoption of IFRS 8 has not aff ected the identifi ed

operating segments for the Group compared to the recent

annual fi nancial statements. Under IFRS 8, reported seg-

ment profi ts are based on internal management reporting

information that is regularly reviewed by the chief operating

decision maker (management approach), and is reconciled

to Group profi t or loss on the following page. The chief op-

erating decision maker assesses segment profi t or loss using

a measure of operating profi t. The measurement policies

the Group uses for segment reporting under IFRS 8 are the

same as those used in its fi nancial statements, except that

certain items are not included in arriving at the operating

profi t of the operating segments (some headquarter operat-

ing results). In addition, corporate assets, which primarily

apply to the Group’s headquarters, have been allocated to

the segments as far as possible.

The Group operates in four main business segments: Coat-

ing, Apparel, Chemicals and Industrial Applications. These

divisions are the basis on which the Group reports its seg-

ment information. The principal products and services of

each of these divisions are described in the annual report

of 2008. Inter-segment sales are undertaken at prevailing

market conditions.

- 20 -

Coating Apparel Industrial Chemicals Other Total applications

6 months ended June 30 2009

Revenue from external customers 54 775 36 943 26 355 18 442 3 136 518

Intersegment revenues 9 057 14 420 2 819 0 12 310

Segment operating result 833 3 184 -205 755 0 4 567

Total assets 197 957 65 701 42 146 48 114 0 353 918

6 months ended June 30 2008


Intersegment revenues 15 953 3 1 548 5 058 0 22 562

Segment operating result 10 623 4 195 1 985 1 917 0 18 719

Total assets 222 652 58 511 57 498 61 383 0 400 044

Year to December 31 2008


Intersegment revenues 25 338 6 2 479 8 271 0 36 093

Segment operating result 11 055 7 922 -154 -2 231 0 16 593

Total assets 214 985 65 779 43 638 50 542 0 374 944

SEGMENT REPORTING


6 months ended 6 months ended Year to

June 30 2009 June 30 2008 December 31 2008

Segment operating profi t 4 567 18 719 16 593

Reconciling items:

Elimination of intersegment profi ts -938 54 -532

Group operating profi t 3 629 18 773 16 060

Financial charges -8 214 -6 825 -18 055

Financial income 5 745 2 454 8 514

Group profi t before tax 1 160 14 402 6 519

Segment operating profi t can be reconciled to Group profi t or loss as follows:

The Group’s revenue and results by operating segment for the period:

Segment profi t represents the profi t earned by each segment without allocation of central administration costs, fi nancial result and tax result.

- 21 -

EXCHANGE RATES

Currency 30/06/2009 31/12/2008 30/06/2008

EUR average 1.00000 1.00000 1.00000

closing 1.00000 1.00000 1.00000

USD average 1.33792 1.47491 1.54435

closing 1.41340 1.39170 1.57640

GBP average 0.89000 0.80287 0.77952

closing 0.85210 0.95250 0.79225

RMB average 9.14068 10.21847 10.83036

closing 9.65447 9.49559 10.80509

PLN average 4.53018 3.52514 3.47577

closing 4.45200 4.15350 3.35130

TDN average 1.86211 1.80650 1.81637

closing 1.88676 1.83512 1.83329

UAH average 10.67600 7.90745 7.54438

closing 10.82966 11.21604 7.20243

INCOME TAX


6 months ended 6 months ended

June 30 2009 June 30 2008

Profi t before taxes 1 160 14 402

Tax on profi t of fi scal entities against theoretical local tax rate 508 43.8% 4 794 33.3%

Theoretical tax rate (1) 43.8% 33.3%

Tax impact of:

Non-deductible expenses 176 15.1% 143 1.0%

Specifi c tax regimes -248 -21.4% -543 -3.8%

Deferred tax assets not recognised 1 048 90.4% 629 4.4%

Usage of non-recognised deferred tax assets 0 0.0% 43 0.3%

Regularisation of current tax on previous years 74 6.4% 34 0.2%

Carry back -246 -21.2% 0 0.0%

Notional interest deduction -682 -58.8% -394 -2.7%

Tax on distributed profi ts (DBI) 0 0.0% 246 1.7%

Other 0 -0.0% -1 0.0%

Tax on profi t as shown in the P&L 627 54.0% 4 952 34.4%

The Group’s consolidated eff ective tax rate for the period ended June 30 2009 was 54.0%, compared to 47.8% for the period ended 31 December 2008 and 34.4% for the period ended June 30 2008.

Reconciliation between taxes and result before taxes:

(1) is the weighted average tax rate.

- 22 -

DEBT AND EQUITY SECURITIES

There were no issuances, repurchases and repayments

of debt and equity securities for the six months ended

June 30 2009.

DIVIDENDS

The Board of Directors does not propose to pay an interim

dividend for the six months ended June 30 2009.

PROPERTY, PLANT AND EQUIPMENT

During the period, the Group invested for approximately

EUR 6.7 milion on assets compared to EUR 7.7 million over

the same period ended June 30 2008. Investments in 2009

mainly relate to buildings under leasing amounting to

EUR 3.4 million, expansion of the second fl oor in the

Indonesian production factory and the implementation

of a new ERP system at 4 entities of the Group. In 2008

investments mainly related to the new production line at

Fabrics Calandering, the increase the production capacity at

Veranneman and the implementation of a new ERP system

at 5 entities of the Group.

Assets that were sold and disposed during the period

related to certain machinery and tools with a net value of

EUR 0.3 million.

An impairment analysis has been done at the end of June

2009 (see ‘impairment test’ review).

The Group did not enter into any signifi cant contractual

commitments during the fi rst half of 2009.

- 23 -

CHANGES IN INVENTORIES


Gross Inventory six months ended year ended 30/06/2009 31/12/2008

Raw materials 30 369 34 937

Consumables 362 400

Work in progress 3 387 4 702

Finished goods 61 968 63 081

Goods in transit 3 753 4 398

TOTAL 99 840 107 518

Amounts written off six months ended year ended 30/06/2009 31/12/2008

Amounts written off raw materials -3 319 -3 173

Amounts written off consumables

Amounts written off work in progress

Amounts written off fi nished goods -5 141 -5 162

Amounts written off goods in transit

TOTAL -8 459 -8 335

Net inventory six months ended year ended 30/06/2009 31/12/2008

Raw materials 27 051 31 764

Consumables 362 400

Work in progress 3 387 4 702

Finished goods 56 828 57 919

Goods in transit 3 753 4 398

TOTAL 91 381 99 183

Gross inventories (excl. write-off ) decreased by € 7.7 million or 7.1%. Decreased activity resulted in an inventory decrease in the coating division, chemicals division and division industrial applications. In the apparel division stock increased by 4% following the slight activity increase.Obsolescence reserves on inventories amounted to € 8.5 million compared with € 8.3 million at the end of 2008. Obsolescence reserves are recorded on the basis of a detailed aging and rotation analysis per unit. There was no signifi cant write off of obsolete inventory to net realisable value in 2009.

Amounts exchange (Other) 6 months written of inventory rate movements or ended 31/12/2008 writedown reversal differences adjustments 30/06/2009

8 335 167 -79 37 0 8 459

Amounts exchange (Other) 6 months written of inventory rate movements or ended 31/12/2008 writedown reversal differences adjustments 30/06/2008 8 770 305 -1 081 79 0 8 073

- 24 -

PROVISIONS


More then one year Within one year Provisions for 1 083 1 645 environmental issues Provisions for other 547 1.724 liabilities and charges Provisions 1 630 3 369

More then one year Within one year Provisions for 1 765 450 environmental issues Provisions for other 622 1 269 liabilities and charges Total provisions 2 387 1 719

The provisions for environmental issues consist mainly of a provision relating to the cleaning of polluted soils in Temse belonging to TIS NV and the land in Ardooie belonging to Sioen Coating NV. The risk in Temse originates in the period before the takeover. The risk in Ardooie was identifi ed during the periodical environmental check-up of the site.

Provisions for other liabilities and charges mainly relate to social costs of ongoing restructuring processes by the coating division and by the division industrial applications. A restructuring provision was recognised by the Group in its annual fi nancial statements as at 31 December 2008 amouting to € 2.2 million. An additional restructuring provision amounting to € 0.7 million was set up during the fi rst half of 2009 and € 0.9 million was used during that period. The estimate of the restructu-ring provision was reduced by € 0.1 million in the six months ended 30 June 2009 due to a positive outcome of claims.

Provisions for 2 763 106 -141 2 728 environmental issues Provisions for other 2 526 717 -860 -117 6 2 271 liabilities and charges Total provisions 5 289 823 -1 002 -117 6 0 4 999

Provisions for 2 214 68 -66 2 215 environmental issues Provisions for other 2 416 545 -1 066 0 -4 1 891 liabilities and charges Total provisions 4 630 613 -1 132 -117 6 0 4 106

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- 25 -

BORROWINGS

LONGTERM INTEREST BEARING LOANS, INCLUD

ING FINANCIAL LONGTERM LEASING DEBT

There were no other signifi cant changes in the long term

borrowings of the Company compared to those disclosed in

the consolidated fi nancial statements of the Group for the

year ended 31 December 2008.

SHORTTERM INTEREST BEARING LOANS

As per 30/06/2009, short-term straight loans amounted to

EUR 18.5 million. They consist of an euro loan of EUR 3.9 mil-

lion with an interest rate of 1.4% and dollar loans of $ 20.7

million with an weighted average interest rate of 2.0%. A tax

prepayment loan expired on 10 April 2009.

At 31/12/2008, short-term straight loans amounted to

EUR 33.2 million.

OBLIGATIONS UNDER FINANCE LEASES

The commitments for the acquisition of intangible and tan-

gible assets, as described in the annual report of 2008, were

added to the balance sheet amounting to EUR 3.3 million

(see ‘Property, Plant and Equipment’)

SHARE CAPITAL

Share capital as at June 30 2009 amounted to EUR 46 mil-

lion. There were no movements in the issued captial of the

Company in either current or the prior interim reporting

periods.

FINANCIAL RISK MANAGEMENT

The Group’s fi nancial risk management objectives and

policies are consistent with those disclosed in the consoli-

dated fi nancial statements as at and for the year ended

December 31 2008.

FINANCIAL INSTRUMENTS

The Group manages a portfolio of derivatives to hedge

against risks relating to exchange rate and interest rate posi-

tions arising as a result of operating and fi nancial activities.

It is the Group’s policy to avoid engaging in speculative

transactions or transactions with a leverage eff ect and not to

hold derivatives for trading purposes.

The market value of the fi nancial instruments are diceded

upon market value reports, received from fi nancial institu-

tions.

Financial Derivatives six months ended 6 months ended

30/06/2009 op 30/06/2008

Notional Fair Notional Fair value value value value

Forward sales contracts

Forward sales contracts within 1 year

Rights 0 0 0 0

Duties 7 400 7 678 0 0

IRS forward 0 0 0 0

- 26 -

EVENTS AFTER REPORTING DATE

There were no material events subsequent to the end of the

interim period.

CONTINGENT ASSETS AND LIABILITIES

Changes in contingent liabilities or contingent assets since the

end of the last annual reporting period:

- The coating division is currently facing a commercial

dispute which could reach EUR 0.5 million. However, the

court verdict in fi rst instance and the appeal was in favour

of Sioen Industries.

There were no other signifi cant changes in the contingencies

of the Company and its subsidiaries from those described

above and those disclosed in the consolidated fi nancial state-

ments of the Group for the year ended December 31 2008.

RELATED PARTY TRANSACTIONS


Nature of six months ended

transaction 30/06/2009

Recticel Group Sale 586

Recticel Group Purchase 99

INCH Sale 520

SVB Purchase 83

Plama Purchase 16

Nature of six months ended

transaction 30/06/2008

Recticel Group Sale 724

Recticel Group Purchase 142

INCH Sale 920

SVB Purchase 131

Verba Purchase 35

Plama Purchase 27

All transactions with related parties are for commercial purposes (raw materials/fi nished products, contruction projects) and were carried out at arm’s length on the basis of international comparable uncontrolled price methods in accordance with IAS 24.

Other transactions with related parties are not included, given the negligible amount (< EUR 10.000).

- 27 -

APPROVAL OF INTERIM FINANCIAL STATEMENTS

These condensed interim consolidated fi nancial statements

have been approved for issue by the board of directors on

August 26 2009.

We hereby confi rm, to the best of our knowledge, that the

condensed consolidated interim fi nancial statements give a

true and fair view of the fi nancial position of the Group as at

30 June 2009, as well as of the fi nancial performance and cash

fl ows for the said period, fully in compliance with the account-

ing standards adopted for use in the EU for interim fi nancial

statements (EU adopted IAS 34, Interim Financial Reporting);

Michèle Sioen Geert Asselman

CEO CFO

PROFILE OF SIOEN

Sioen Industries is market leader in the production of coated

technical textiles, a market leader in industrial protective

clothing, a niche specialist in fi ne chemicals and a major world

player in processing technical textiles into semi-fi nished

products and technical end products.

Detailed information can be found on www.sioen.com

FINANCIAL CALENDAR

Friday October 30 2009: trading update, 3rd quarter 2009

For further information/Financial information/

Investor relations:

Geert Asselman, CFO

Sioen Industries n.v.

Fabriekstraat 23, B-8850 Ardooie

T 051 74 09 80 / F 051 74 09 79

E-mail: [email protected]

Website: www.sioen.com

Financial servicing is provided by KBC, Fortis, ING, Dexia and

Bank Degroof.

SIOEN INDUSTRIESFabriekstraat 23 • B-8850 ArdooieT +32(0)51 74 09 80F +32(0)51 74 09 79E [email protected] www.sioen.comBTW BE 441.642.780

RPR 0441.642.780 Brugge

JAARVERSLAG/RAPPORT ANNUEL/ANNUAL REPORTDit verslag is beschikbaar in het Nederlands, het Frans en het Engels.Ce rapport est disponible en français, en néerlandais et en anglais.This report is available in English, Dutch and French.

Realization: www.kliek.be - T +32 (0)51 40 43 12 - ref. 09 0542

FINANCIAL INFORMATION AND INVESTOR RELATIONSFor all further information, institutionalinvestors and fi nancial analysts are advisedto contact: Geert Asselman Chief Financial Offi cer

FINANCIAL CALENDARTrading update third quarter results 2009 - Friday October 30 2009

Documents

Half-year results 2009