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Fuchs to Raise Dividend About 30% After Profit Beat Estimates

Fuchs Petrolub AG (FPE), the world’s largest independent lubricants maker, proposed paying out almost a third more in dividends this year after 2012 earnings beat analysts’ estimates.

The payout will be 1.30 euros per preferred share and 1.28 euros per common share, about 30 percent more for each, the Mannheim, Germany-based company said today in a statement. Earnings before interest and tax rose 11 percent to 293 million euros ($387 million) last year, beating the 290.9 million-euro average estimate of 15 analysts. The preferred shares jumped the most in eight months in Frankfurt trading.

Fuchs predicted earnings and sales will rise again in 2013 even though the company won’t be able to repeat the growth rates of previous years, it said today. Chief Executive Officer Stefan Fuchs has been boosting the company’s sales force and has said he will look at any potential targets that come on the market.

“We consider Fuchs Petrolub still well-positioned with respect to its product portfolio in niche markets,” Heinz Mueller, an analyst at DZ Bank AG, said today in a note to clients. Heinz reiterated his buy recommendation on the stock.

Berenberg had estimated Fuchs to raise its dividend on preferred shares to 1.20 euros.

The stock rose as much as 5.1 percent, the biggest intraday jump since June 29. It was trading 4.9 percent higher at 59.79 euros as of 12:42 p.m. local time. The shares have gained 6.5 percent this year, giving the company a market value of 4.1 billion euros.

Sales rose 10 percent to 1.82 billion euros in 2012, in line with analyst estimates. Net income rose 13 percent to 207 million euros, Fuchs said.

To contact the reporter on this story: Sheenagh Matthews in Frankfurt at smatthews6@bloomberg.net

To contact the editor responsible for this story: Simon Thiel at sthiel1@bloomberg.net

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