SKW Stahl-Metallurgie Holding AG / Quarter Results
15.05.2009
Release of a Corporate News, transmitted by DGAP - a company of EquityStory AG.
The issuer is solely responsible for the content of this announcement.
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Press release
SKW Metallurgie slightly profitable despite massive negative economic
factors
- Global recession results in revenues 38% lower compared to Q1-2008
- High proportion of variable costs allows EBITDA of EUR 1.9 million
- Balance sheet structure further reinforced: Equity ratio up to 47.3%, net
financial debt substantially reduced
- Outlook: 2009 depending on general economic development, return to former
profitability forecast for 2011 at the latest
Unterneukirchen (Germany), May 15, 2009. SKW Stahl-Metallurgie Holding AG
was able to record positive earnings in the first quarter of 2009 despite
significant negative factors stemming from the global recession. Quarterly
revenues fell significantly from EUR 81.0 million to EUR 50.0 million,
however in view of the high proportion of variable costs SKW Metallurgie
succeeded in recording positive EBITDA of EUR 1.9 million (previous year:
EUR 7.1 million). This corresponds to an EBITDA margin of 3.8% (previous
year: 8.7%). The downturn in revenues during the period under review was
due to the slump in steel production in the regions which are particularly
relevant for the SKW Metallurgie Group, namely the EU ( 43.8%) and the USA
(-52.5%) and the resulting downturn in demand for SKW Metallurgie's
products.
A year-on-year downturn in steel production of approx. 30% is forecast for
both the EU as well as for NAFTA for 2009 as a whole. As a result, the SKW
Metallurgie Group's Managing Board believes that demand for SKW
Metallurgie's products will also fall significantly over the year as a
whole, and is reacting with an additional cost cutting program. In total,
SKW Metallurgie is forecasting a positive consolidated annual operating
result despite the financial and economic crisis, if the economic revival
forecast for the second half of 2009 actually occurs.
At the same time, the SKW Metallurgie Group is continuing its international
expansion in BRIC countries, despite the difficult economic situation, in
order to further reduce its dependence on the Central European and North
American markets.
'2009 will be a very challenging year for us - as is clearly underscored by
the figures from the first quarter. However, our high proportion of
variable costs and our early implementation of cost cutting measures mean
that our EBITDA is positive, even in difficult periods. Once the global
economy has returned to normal, we are confident that we will be able to
return to our former profitable growth path,' commented SKW Metallurgie's
CEO, Ines Kolmsee.
Earnings after taxes only marginally positive
Personnel costs were reduced significantly as a result of the more than 10%
reduction in the workforce, thus bringing this into line with demand, and
the introduction of short-time work in France. In spite of this, however,
the significant reduction in revenues meant that EBIT totaled just EUR 0.4
million (previous year: EUR 5.1 million) and a marginal profit after taxes
of EUR 0.1 million (Q1 2008: EUR 3.3 million). Earnings per share in the
period under review thus totaled EUR 0 (rounded), compared to EUR 0.76 in
the first quarter of 2008.
Balance sheet structure further reinforced
SKW Metallurgie's management has continued to focus on optimizing the
balance sheet structure and on cash generation. As a result, during the
year under review, the equity ratio (including minority interests) was
improved compared to the end of 2008 from 42.6% to 47.3%, despite the
difficult environment. It was possible to reduce net financial debt during
the first quarter by EUR 4.9 million to EUR 40.0 million, mainly due to the
reduction in working capital by EUR 5.5 million during the period under
review. As a result, the cash flow from operating activities totaled EUR
6.5 million, up by EUR 2.6 million compared to the comparable prior-year
level.
2009 marred by economic developments - former profitability to be regained
in 2011
The Worldsteel Association, the umbrella association for the steel
industry, has forecast a downturn in global steel production by 15% to
1,019 million tons for 2009. This downturn will affect SKW Metallurgie's
core markets (EU: -29%; NAFTA: -32%) disproportionately strongly. Revenues
and operating EBITDA for the SKW Metallurgie Group will thus be
significantly lower than the figures for business year 2008. The Managing
Board believes that, as a result of its efficient cost management and
despite the financial and economic crisis, it will record a positive
consolidated operating result over the year as a whole, if the
revitalization of the economy forecast for the second half of 2009 actually
occurs. In addition, the focus in 2009 is on a solid cash flow from
operating activities.
In order to record sustained profitable growth, and to further reduce
dependence on traditional markets in Central Europe and North America,
international expansion in the BRIC countries is being continued, despite
the difficult economic situation. Assuming that the economy gets back to
normal, the Managing Board is confident that the company will return to its
former profitability path at the latest in 2011. As a result, the Managing
Board has confirmed the SKW Metallurgie Group's medium-term targets of
recording revenues of EUR 360 million and an operating EBITDA margin of 9%
in 2011.
You can find SKW Stahl-Metallurgie Holding AG's Q1 2009 report and
additional information on our company on our Web site: www.skw-steel.com
SKW Stahl-Metallurgie Holding AG KPIs
(in EUR million)<pre> Q1 Q1
2009 2008
Revenues 50.0 81.0
thereof:
- Cored Wire 20.7 33.1
- Powder and Granules 25.1 41.7
EBITDA
thereof: 1.9 7.1
- Cored Wire 0.8 1.9
- Powder and Granules 1.1 5.1
EBITDA margin 3.8% 8.7%
EBIT 0.4 5.1
Profit/loss before taxes -0.2 4.5
Profit after taxes 0.1 3.3
Earnings per share (in EUR) 1 0.00 0.76
Cash flow from operating activities 6.5 3.9
March 31, 09 Dec. 31, 08
Total assets&liabilities 181.4 196.8
Equity (including minority interests) 85.8 83.8
Net financial debt 40.0 44.9
Gearing 2 0.47 0.54
Equity ratio (including minority interests) 47.3% 42.6%</pre>
(1) Based on an unchanged 4,422,250 shares in circulation
(2) Net financial debt to equity
Contact person:
SKW Stahl-Metallurgie Holding AG
Christian Schunck
Head of IR and Corporate Communication
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 desulphurization, and for cored wire used in secondary metallurgy.
The Group's 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.
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. The company's operating business is broken down into the
two core segments 'Cored Wire and 'Powder and Granules', and the 'Other'
segment. 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, and have been included in the SDAX index from 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, unpredictable changes in political and economic conditions,
particularly in the steel and paper industry, the competitive situation,
interest and currency risks, technological development as well as 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 IR and Corporate Communication
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 15.05.2009
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Language: English
Issuer: SKW Stahl-Metallurgie Holding AG
Fabrikstrasse 6
84579 Unterneukirchen
Deutschland
Phone: +49 (0)8634 61 511
Fax: +49 (0)8634 61 513
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
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DGAP-News: SKW Stahl-Metallurgie Holding AG: SKW Metallurgie slightly profitable despite massive negative economic factors
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