DGAP-News: VTG increases profitability in the first half of 2016 - Revenue slightly below the previous year


DGAP-News: VTG Aktiengesellschaft / Key word(s): Half Year Results
VTG increases profitability in the first half of 2016 - Revenue slightly
below the previous year

30.08.2016 / 07:30
The issuer is solely responsible for the content of this announcement.

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Press Release

VTG increases profitability in the first half of 2016 - Revenue slightly
below the previous year

  - Group net profit up by nearly 50 percent despite small drop in revenue

  - Substantial reduction in interest expenses combines with synergies from
    AAE acquisition to drive higher profitability

  - Earnings per share significantly higher than in the previous year

  - EBITDA forecast reaffirmed - Revenue expectations for 2016 slightly
    reduced

Hamburg, August 30, 2016. VTG Aktiengesellschaft (WKN: VTG999), one of the
leading wagon hire and rail logistics companies in Europe, raised its
profitability significantly in the first half of 2016. Although Group
revenue of EUR 493.3 million (first half of 2015: EUR 512.3 million) and
EBITDA of EUR 165.8 million (first half of 2015: EUR 168 million) were both
down by a small amount year on year, Group net profit improved sharply,
increasing by around 50 percent to EUR 26.7 million (first half of 2015:
EUR 18.1 million). Earnings per share (EPS) climbed even more steeply from
EUR 0.42 in the first half of 2015 to EUR 0.71 in the period under review.
Successful refinancing in 2015 and the realization of synergies following
the acquisition of AAE are two of several reasons for this positive
development.

"The results for the first half of this year show that we are well on the
way to further increasing our profitability. Thanks to successful
refinancing and the realization of valuable synergies resulting from the
AAE acquisition, we can be pleased with an above-average increase in Group
net profit and EPS in the first half-year," says Dr. Heiko Fischer, CEO of
VTG Aktiengesellschaft. "The results confirm that we are pursuing the right
strategy, even though more positive developments in revenue and EBITDA were
hampered by external factors such as the low price of oil and the reduction
in truck tolls in Germany. We thus had to slightly reduce our expectations
regarding the revenue trend in 2016. However, we still believe that we are
well on the way to raising EPS to EUR 2.50 by 2018."

Railcar EBITDA margin up - Revenue down slightly
In the first half of 2016, the Railcar Division recorded revenue of EUR
254.7 million (first half of 2015: EUR 272.4 million), a decline of 6.5
percent. A large proportion of this decrease is of little or no relevance
to Group net profit. However, the low price of diesel shifted
transportation to the road, prompting a decline in the intermodal wagon
utilization rate in particular. Total fleet utilization thus edged down to
90.1 percent (first half of 2015: 90.2 percent). Since synergies arising
from the AAE acquisition compensated for some of the drop in revenue,
EBITDA was down only to a minor extent - by 1.3 percent to EUR 165.5
million - compared to the same period in the previous year (EUR 167.6
million). Year on year, the EBITDA margin improved by 3.5 percentage points
to 65.0 percent (first half of 2015: 61.5 percent).

Capital expenditure of EUR 102.9 million in the first half of 2016 was 10.4
percent higher than the previous year's figure of EUR 93.3 million.
Virtually all of this money was invested to expand and modernize the fleet.

Substantially better margins at Rail Logistics - Slight revenue increase at
Tank Container Logistics
The Rail Logistics Division saw revenue fall slightly by 1.3 percent to EUR
155.6 million in the first half of 2016 (first half of 2015: EUR 157.7
million). In addition to customers' production outages and slacker current
demand for transportation in the agricultural sector, the discontinuation
of low-margin business and an locomotive drivers' strike in France were the
main factors contributing to this small drop.
Despite declining revenue, the division's EBITDA rose sharply to EUR 2.6
million in the first half of 2016, up from EUR 1.2 million in the same
period a year ago. The successful acquisition of new business and the new,
more efficient structures in the division were largely responsible for this
gain. The gross profit-based EBITDA margin for Rail Logistics thus
increased to 18.7 percent in the first half of 2016 (first half of 2015:
8.9 percent).
Tank Container Logistics realized a healthy transportation volume with the
number of orders rising in Europe and overseas traffic remaining stable.
After a weak start to the year, year-on-year revenue edged up from EUR 82.2
million to EUR 83 million, a gain of 0.9 percent. Primarily due to the non-
recurrence of an extraordinary result of EUR 1.5 million from the sale of a
holding in the first quarter of 2015, EBITDA was down by 12.8 percent,
declining from EUR 6.6 million to EUR 5.8 million in line with
expectations. Adjusted for this positive extraordinary result, EBITDA was
up 13 percent in the first half of 2016 compared to the same period in the
previous year. The gross profit-based EBITDA margin thus stood at 38.1
percent, remaining unchanged from the adjusted figure for the first half of
2015.

EBITDA forecast for 2016 reaffirmed - Revenue expectations reduced slightly
The revenue trend at the VTG Group was lower in the first half of 2016 than
in the same period of the previous year. Both the Railcars and Rail
Logistics Divisions felt the impact of weaker demand. One reason was that
little growth stimulus came from global trade. At the same time, the low
price of oil led to transportation being shifted from rail to road in
Europe. Efficiency gains in all divisions were able to compensate for much
of the decline in revenue that affected Group net profit, with the result
that EBITDA was down only slightly on the previous year at the midway mark
in 2016. However, in light of only moderate global economic development,
the Executive Board is no longer expecting to be able to catch up on lower
revenue in the second half of the year. The revenue forecast for 2016
(between EUR 1.03 billion and EUR 1.07 billion) has been adjusted
accordingly. The Board now expects revenue to be slightly lower than in the
previous year (EUR 1.03 billion). Since a large proportion of the decline
in revenue has little impact on Group net profit, the EBITDA range from EUR
345 million to EUR 355 million forecast in February for 2016 as a whole
remains unchanged. The Executive Board does, however, believe that this
forecast will be met only at the lower end.


<pre>

Key Figures for the VTG Group

Financial year            1.1. - 30.6.       1.1. - 30.6.    Change in %
                                  2016               2015
Revenue                          493.3              512.3           -3.7
in EUR million
EBITDA                           165.8              168.0           -1.3
in EUR million
EBIT in EUR million               72.7               71.4            1.8
EBT in EUR million                41.1               28.2           45.4
Group net profit                  26.7               18.1           47.7
in EUR million
Depreciation and                  93.1               96.6           -3.6
amortization
in EUR million
Capital expenditure              102.9               93.3           10.4
in EUR million
Operating cash flow              147.8              139.6            5.9
in EUR million
Earnings per share                0.71               0.42           69.0
in EUR
Railcar Division
Revenue                          254.7              272.4           -6.5
in EUR million
EBITDA                           165.5              167.6           -1.3
in EUR million
EBITDA margin in %                65.0               51.5
Rail Logistics
Division
Revenue                          155.6              157.7           -1.3
in EUR million
EBITDA                             2.6                1.2           >100
in EUR million
EBITDA margin in %                18.7                8.9
Tank Container
Logistics Division
Revenue                           83.0               82.2            0.9
in EUR million
EBITDA                             5.8                6.6          -12.8
in EUR million
EBITDA margin in %                38.1               49.2
                             30.6.2016         30.06.2015    Change in %
Number of employees              1,406              1,433           -1.9
- in Germany                       927                908            2.1
- abroad                           479                525           -8.8
                            30.06.2016         31.12.2015    Change in %
Balance sheet total            2,993.9            3,047.1           -1.8
in EUR million
Non-current assets             2,678.3            2,708.1           -1.1
in EUR million
Current assets                   315.0              339.0           -7.1
in EUR million
Shareholders equity              734.4              748.2           -1.8
in EUR million
Liabilities                    2,258.9            2,298.9           -1.7
in EUR million
Equity ratio in %                 24.5               24.6


</pre>

About VTG:
VTG Aktiengesellschaft is one of Europe's leading wagon hire and rail
logistics companies, with a fleet consisting of more than 80,000 railcars.
VTG offers a full-range service, providing tank cars, intermodal wagons,
standard freight wagons and sliding wall wagons. In addition to the hiring
of wagons, the Group offers comprehensive multi-modal logistics services,
mainly around rail transport, and global tank container transports.

With the combination of its three interlinked divisions Railcar, Rail
Logistics and Tank Container Logistics, VTG offers its customers a high-
performance platform for international transport of their freight. The
Group has many years of experience and specific expertise, in particular in
the transport of liquid and sensitive goods. Its customers include numerous
well-known companies from almost every industrial sector, for example the
chemical, petroleum, automotive, paper and agricultural industries.

In the financial year 2015, VTG generated revenue of EUR 1,027.5 million
and operating profit (EBITDA) of EUR 336.5 million. Via its subsidiaries
and affiliates the company, which has its head office in Hamburg, is mainly
present in Europe, North America, Russia and Asia. As at 31 December 2015,
VTG had 1,445 employees worldwide in consolidated companies. VTG AG is
listed on the official Prime Standard market of the Frankfurt Stock
Exchange and also on the SDAX (WKN: VTG999).

Press contact:
Gunilla Pendt
Head of Corporate Communications
Telephone: +49 (0) 40 23 54-1341
Fax:     +49 (0) 40 23 54-1340
Email:      gunilla.pendt@vtg.com

Investor Relations contact:
Christoph Marx
Head of Investor Relations
Telephone: +49 (0) 40 23 54-1351
Fax:  +49 (0) 40 23 54-1350
Email:  christoph.marx@vtg.com

More information at www.vtg.com


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30.08.2016 Dissemination of a Corporate News, transmitted by DGAP - a
service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.

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   Language:    English                                                     
   Company:     VTG Aktiengesellschaft                                      
                Nagelsweg 34                                                
                20097 Hamburg                                               
                Germany                                                     
   Phone:       040 2354 1351                                               
   Fax:         040 2354 1350                                               
   E-mail:      ir@vtg.com                                                  
   Internet:    www.vtg.de                                                  
   ISIN:        DE000VTG9999                                                
   WKN:         VTG999                                                      
   Indices:     SDAX                                                        
   Listed:      Regulated Market in Frankfurt (Prime Standard); Regulated   
                Unofficial Market in Berlin, Dusseldorf, Hamburg, Hanover,  
                Munich, Stuttgart, Tradegate Exchange                       
 
 
   End of News    DGAP News Service  
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496779 30.08.2016