SKW Stahl-Metallurgie Holding AG / Quarter Results 12.11.2008 Release of a Corporate News, transmitted by DGAP - a company of EquityStory AG. The issuer is solely responsible for the content of this announcement. --------------------------------------------------------------------------- Press release Record revenues and earnings once again in Q3 2008 Q3: Revenues + 115% to EUR 112.7 million; EBITDA more than triples to EUR 12.3 million Nine month figures: Revenues +87% to EUR 296.0 million; EBITDA +83% to EUR 28.9 million Earnings target (operating EBITDA) increased again for 2008: New forecast minimum of EUR 32 million Unterneukirchen (Germany), November 12, 2008. SKW Stahl-Metallurgie Holding AG once again recorded record-breaking revenues and earnings in Q3 2008. Consolidated revenues in the third quarter were up 115% to EUR 112.7 (previous year: EUR 52.5) million. EBITDA more than tripled from EUR 4.0 million to EUR 12.3 million. The return on sales increased correspondingly from 7.6% to 10.9%. Accumulated consolidated revenues after the first nine months were up 87% to EUR 296.0 (previous year: EUR 158.5) million. EBITDA after the first three quarters was up 83% from EUR 15.8 million to EUR 28.9 million. After adjustment for one-off income from the Quab acquisition totaling EUR 4.2 million in 2007, operating profits were up by around 150%. As a result of the excellent growth in the first nine months, the SKW Metallurgie Group's Managing Board has lifted its earnings forecast for 2008 from operating EBITDA of EUR 28 to 30 million to a minimum of EUR 32 million. 'The SKW Metallurgie Group can look back on three successive quarters that have even surpassed our own expectations. This will allow us to compensate for the anticipated weaker underlying conditions in the last quarter of the year. As a result, we have now increased our earnings guidance for 2008 as a whole for the second time now for operating EBITDA of a minimum of EUR 32 million,' commented SKW Metallurgie's CEO Ines Kolmsee on the figures. Comparable earnings per share up 119% to EUR 3.32 Gross margin, the relevant indicator for the group's operating performance, increased from 24.7% to 25.9% in a nine-month comparison. EBIT increased from EUR 13.9 million to EUR 24.0 million; in operating terms, the increase on the figure from the first nine months of 2007 increased from EUR 9.7 million up even more substantially. This positive trend can also be seen in earnings after taxes, which increased by 126% to EUR 14.7 million before minority interests (after adjustment). The adjusted earnings per share increased from EUR 1.45 to EUR 3.32. Cored Wire and Powder and Granules enjoy strong growth In the Cored Wire segment, the dynamic pace increased significantly in the second and third quarters; revenues from third parties (to EUR 120.2 million) and EBITDA (to EUR 10.1 million) were both up around 20% year on year after the first nine months. In the Powder and Granules segment, in particular the ESM consolidation and also substantial improvements in the other units led to an increase in revenues from third parties of more than 300% to EUR 158.2 million and earnings improving more than seven-fold to EUR 21.1 million. In the smallest segment, Quab, the weakness of the US dollar for most of the period under review and flood damage at a key US customer that lasted for several months had a negative impact. As a result, revenues from third parties totaled EUR 17.6 million and EBITDA totaled EUR 1.0 million, lower than in the previous year as had been expected. Continued very solid balance sheet structure The excellent business growth and increasing prices for commodities led to a significant increase in working capital in the first nine months of 2008. This resulted in a substantial shift in the balance sheet and thus an increase in total assets climbed by around EUR 43 million compared to the end of 2007 to EUR 224.4 million. In spite of this, however, the equity ratio of 39.4% continues to be very solid. Net financial debt increased from EUR 41.8 million to EUR 54.5 million. However, part of these effects should have been compensated for again by the end of the year. In addition, the gross cash flow increased significantly up 118% compared to the previous year from EUR 9.4 million to EUR 20.1 million, thus already significantly up on the figure for the whole of 2007 of EUR 14.4 million. Earnings guidance for the full 2008 business year lifted again In view of the excellent growth in the first nine months and the sound visibility for the final quarter of the year, the company is lifting its earnings forecast significantly for 2008 as a whole for the second time this year. The target for operating EBITDA has been increased from the previous EUR 28 to 30 million to a minimum of EUR 32 million (previous year: EUR 21.1 million including bargain purchase). Some customers from the steel industry have announced capacity adjustments for the current fourth quarter of 2008 and the first quarter of 2009, which they plan to use to conduct necessary maintenance work. As a result, SKW Metallurgie believes that business year 2009 will get off to a reserved start. As is common at SKW Metallurgie, a full-year guidance for 2009 is intended to be given at the year-end press and analysts conference on March 20, 2009. The Group will consistently continue its international expansion in high-growth emerging nations independently of the current developments. As a result, the production of cored wire in the SKW Metallurgie Group's new plant in Mexico started in the third quarter of 2008. Production is scheduled to start in Russia in the first quarter of 2009. SKW Stahl-Metallurgie Holding AG's full quarterly report is available online at www.skw-steel.com. SKW Stahl-Metallurgie Holding AG KPIs (in million)<pre> Q1-3 Q1-3 2008 20072 Revenues 296.0 158.2 Thereof with third parties: - Cored Wire 120.2 102.0 - Powder and Granules 158.5 36.5 - Quab 17.6 20.0 Gross margin 25.9% 24.7% EBITDA 28.9 15.8 thereof: 1 - Cored Wire 10.1 8.4 - Powder and Granules 21.1 2.8 - Quab 1.0 6.5 - Quab comparable3 1.0 2.3 EBITDA comparable3 28.9 11.6 EBITDA margin comparable3 9.8% 7.3% EBIT 24.0 13.9 EBIT comparable3 24.0 9.7 Earnings before taxes 22.0 14.0 Profits after taxes (before minority interests) 14.7 10.7 Profits after taxes comparable3 (before minority interests) 14.7 6.5 Earnings per share () 3.32 2.42 Earnings per share () comparable3 3.32 1.45 Sept. 30, 2008 Dec. 31, 2007 Total assets 224.4 181.3 Equity 88.4 76.2 Net financial assets -54.5 -41.8 Gearing (= net financial assets / equity) -61.7% -55% Equity ratio 39.4% 42.0% Gross cash flow (nine-month period) 20.1 9.4</pre> 1: The total EBITDA in the three operating segments is greater than the consolidated figure as, at a group level, consolidations and the segment 'Other' are also included 2: The Quab business has been consolidated in the SKW Metallurgie Group since January 16, 2007. 3: 'Comparable' means adjusted for the bargain purchase from the Quab acquisition totaling EUR 4.2 million. Contact person: SKW Stahl-Metallurgie Holding AG Christian Schunck Head of Investor Relations and Corporate Communications Fabrikstrasse 6 84579 Unterneukirchen Germany Tel.: +49 8634 -617596 Fax: +49 8634-617594 E-Mail: schunck@skw-steel.com Internet: www.skw-steel.com About SKW Stahl-Metallurgie Holding AG SKW Metallurgie is the global market leader for chemical additives for hot metal desulfurization, and for cored wire used in secondary metallurgy. The Groups products enable steel-makers to efficiently manufacture high-quality steel products. Clients include the world's leading companies in the steel industry. The SKW Metallurgie Group has more than 50 years of metallurgical know how, and currently operates in more than 40 countries. Approximately 44% of revenues are recorded in Europe and approx. 42% in the NAFTA region (2007; ESM revenues included as of initial consolidation). What is more, the Group is a leading supplier of Quab specialty chemicals, which are mainly used in the global production of industrial starch for the paper industry. SKW Metallurgies operations are structured into the three business segments 'Cored Wire', 'Powder and Granules', and 'Quab'. The SKW Metallurgie Group is headquartered in Germany with production facilities in France, the US (6), Canada, Mexico, South Korea, the Peoples' Republic of China (2) and India (2 via joint ventures).. Shares of SKW Stahl-Metallurgie Holding AG have been listed in Frankfurt Stock Exchange's Prime Standard since December 1, 2006 with ISIN DE000SKWM013. SKW Stahl-Metallurgie Holding AG's shares have been included in the SDAX stock market index since June 23, 2008. DISCLAIMER This press release contains statements on future developments that are based on currently available information and involve risks and uncertainties that could cause the actual results to differ from these forward-looking statements. These risks and uncertainties include, for example, unforeseeable changes to political and economic conditions, in particular in the steel and paper production industry, the competitive situation, changes in interest rates and exchange rates, technological developments and other risks and unexpected circumstances. SKW Stahl-Metallurgie Holding AG and its Group companies accept no obligation to update such forward-looking statements. SKW Stahl-Metallurgie Holding AG Christian Schunck Head of Investor Relations and Corporate Communications Fabrikstrasse 6 84579 Unterneukirchen Germany Tel.: +49 8634 -617596 Fax: +49 8634-617594 E-Mail: schunck@skw-steel.com Internet: www.skw-steel.com DGAP 12.11.2008 --------------------------------------------------------------------------- Language: English Issuer: SKW Stahl-Metallurgie Holding AG Fabrikstrasse 6 84579 Unterneukirchen Deutschland Phone: +49 (0)8634 61 7596 Fax: +49 (0)8634 61 7594 E-mail: info@skw-steel.com Internet: www.skw-steel.com ISIN: DE000SKWM013 WKN: SKWM01 Indices: SDAX Listed: Regulierter Markt in Frankfurt (Prime Standard); Freiverkehr in Berlin, Stuttgart, München, Hamburg, Düsseldorf End of News DGAP News-Service ---------------------------------------------------------------------------
DGAP-News: SKW Stahl-Metallurgie Holding AG: Record revenues and earnings once again in Q3 2008
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