07:00 London, 09:00 Helsinki, 24 February 2012 - Ruukki Group Plc ("Ruukki" or "the Company") (LSE: RKKI, OMX: RUG1V) Financial Statements Review
RUUKKI GROUP PLC'S FINANCIAL STATEMENTS REVIEW FOR 1 JANUARY-31 DECEMBER 2011
Q4 HIGHLIGHTS (October-December 2011):
- Production increased by 156.5% to 86,903 (Q4/2010: 33,883) tonnes
- Revenue from continuing operations increased by 50.6% to EUR 37.3 (Q4/2010: 24.8) million
- EBITDA from continuing operations was EUR -1.1 (Q4/2010: -7.0) million and the EBITDA margin was -2.9% (Q4/2010: -28.1%)
- EBIT from continuing operations was EUR -8.0 (Q4/2010: -54.2) million
- Profit for the period from continuing operations totalled EUR -4.9 (Q4/2010: -51.0) million
- Cash flow from operations was EUR 5.0 (Q4/2010: 1.6) million and liquid funds at 31 December 2011 were EUR 65.9 (31 December 2010: 8.6) (30 September 2011: 74.2) million
FULL YEAR HIGHLIGHTS (January-December 2011):
- Full year production increased by 156.6% to 353,962 tonnes (FY/2010: 137,951 tonnes)
- Revenue from continuing operations increased by 29.0% to EUR 159.1 (FY/2010: 123.3) million
- EBITDA from continuing operations was EUR 1.4 (FY/2010: -8.4) million and the EBITDA margin was 0.9% (FY/2010: -6.8%)
- EBIT from continuing operations was EUR -26.5 (FY/2010: -75.6) million
- Profit for the period from continuing operations totalled EUR -18.4 (FY/2010: -65.3) million
- Cash flow from operations was EUR -2.4 (FY/2010: 10.6) million
- Divestment of the wood processing businesses during the first half of 2011 for a total consideration of EUR 90.6 million
- Integration of the Chromex assets, acquired in December 2010, into FerroAlloys business
- Appointment of Thomas Hoyer as Chief Executive Officer on 4 May 2011
Dividend proposal
The Board of Directors proposes to the Annual General Meeting which will be held on 10 May 2012 that no dividend would be distributed.
| KEY FIGURES | ||||||
| EUR million | Q4/11 | Q4/10 | Change | FY/11 | FY/10 | Change |
| Revenue | 37.3 | 24.8 | 50.6% | 159.1 | 123.3 | 29.0% |
| EBITDA | -1.1 | -7.0 | 1.4 | -8.4 | ||
| EBITDA margin | -2.9% | -28.1% | 0.9% | -6.8% | ||
| EBIT | -8.0 | -54.2 | -26.5 | -75.6 | ||
| EBIT margin | -21.3% | -218.7% | -16.6% | -61.3% | ||
| Earnings before taxes | -7.2 | -54.3 | -25.4 | -76.3 | ||
| Earnings margin | -19.4% | -219.2% | -16.0% | -61.8% | ||
| Profit for the period, continuing operations | -4.9 | -51.0 | -18.4 | -65.3 | ||
| Profit for the period, discontinued operations | -5.8 | 6.6 | 41.1 | 14.2 | 189.6% | |
| Profit for the period | -10.7 | -44.5 | 22.7 | -51.1 | ||
| Earnings per share, basic, EUR | -0.04 | -0.19 | 0.10 | -0.22 | ||
| Return on equity, % p.a. | - | - | 9.5% | -19.6% | ||
| Return on capital employed, % p.a. | - | - | 7.0% | -15.2% | ||
| Equity ratio, % | - | - | 57.0% | 44.3% | ||
| Gearing, % | - | - | 8.1% | 46.6% | ||
| Personnel at the end of the period | - | - | 797 | 722 |
Continuing operations include the Speciality Alloys and the FerroAlloys business segments and unallocated items that consist of Group headquarters and other Group companies, which do not have significant business operations. Discontinued operations include the house building, pallet and sawmill businesses.
Commenting on the full year and fourth quarter results, Thomas Hoyer, CEO, said:
"I am pleased to report a clear improvement by the Group for 2011, despite challenging and volatile market conditions. Production for the year improved by a substantial 156.6% to 353,962 tonnes, mainly due to the acquisition of Chromex Mining and the ramp up in production at the Stellite mine, revenue increased by 29% to EUR 159.1 million for the year and EBITDA grew by EUR 9.8 million to 1.4 million, compared to our 2010 performance.
The completion of our strategic transformation from a mini-conglomerate into a vertically integrated ferroalloys producer enabled us to re-deploy the cash proceeds from the wood assets, totalling over EUR 80 million, into the ferroalloys business to provide flexibility and strengthen the Group's balance sheet.
This, along with our diversified product range enabled us to weather the difficult market conditions during year driven by the global macro-economic sentiment. Whilst the market for chrome ore consistently decreased throughout the year and demand remained weak, the market for our speciality alloy products was more stable, with prices remaining relatively firm.
Turning to our fourth quarter performance, market conditions remained tough, particularly for the FerroAlloys division with processing volumes adjusted to match demand. This situation is forecast to continue for the first half of the year and coincides with ESKOM's offer to buy back electricity from energy intensive industries. Accordingly Ruukki has taken advantage of this offer and placed Mogale's furnaces on care and maintenance. The situation will be reviewed in the second quarter.
Our balance sheet and cash position remain strong and we believe this will offer some protection against the uncertain market conditions as we enter 2012."
2012 outlook
The global economic outlook for 2012 is uncertain as the Eurozone crisis continues and demand for commodities, primarily driven by Chinese consumption, remains weak. The ferroalloy market is expected to continue to be volatile during the year. The Group is preparing for significant price fluctuations and will continue to adapt its productions levels accordingly. At Mogale, part of the FerroAlloys division, the decision has been taken to put furnaces on care and maintenance for the first half of the year. This decision will be reviewed during the second quarter. The market for speciality alloy products is estimated to be more stable, however, uncertainty remains in 2012 too. In light of this and until the market for its products improve, the Group expects its financial performance for the full year 2012 to be comparable to 2011.
Fluctuations of exchange rates between the Euro, the South African Rand, the Turkish Lira and the US Dollar can significantly impact the Company's financial performance.
Disclosure procedure
Ruukki follows the new disclosure procedure enabled by Standard 5.2b published by the Finnish Financial Supervision Authority, and hereby publishes its Financial Statements Review for 2011 enclosed to this stock exchange release. The Financial Statements Review for 2011 is attached to this release and is also available on the Company's website at www.ruukkigroup.com.
Investor Conference Call
Management will host an investor conference call in English on 24 February 2012 at 14.00 Finnish time, 12.00 UK time. Please dial-in at least 10 minutes beforehand, quoting the reference: 912604.
Finnish number +358 (0)9 2313 9201
UK number +44 (0)20 7162 0077
Financial Statements, Corporate Governance Statement and Annual Report
The Company's complete Financial Statements, the Corporate Governance Statement and the Annual Report for 2011 will be published during the week commencing 26 March 2012 and will be available on the Company's website: www.ruukkigroup.com and at the Company's offices.
RUUKKI GROUP PLC
Thomas Hoyer
CEO
For additional information, please contact:
Ruukki Group Plc
Thomas Hoyer, CEO, +358 (0)10 440 7000, thomas.hoyer@ruukkigroup.com
Kalle Lehtonen, General Manager: Finance, +358 (0)400 539 968, kalle.lehtonen@ruukkigroup.com
Markus Kivimäki, General Manager: Corporate Affairs, +358 (0)50 3495 687, markus.kivimaki@ruukkigroup.com
Investec Bank Plc
Stephen Cooper, +44 (0)20 7597 5104, stephen.cooper@investec.co.uk
RBC Capital Markets
Martin Eales, +44 (0)20 7653 4000, martin.eales@rbccm.com
Peter Barrett-Lennard, +44 (0)20 7653 4000, peter.barrett-lennard@rbccm.com
Financial reports and other investor information are available on the Company's website.
Ruukki Group is a chrome mining and minerals producer focused on delivering sustainable growth with a speciality alloys business in southern Europe and a ferro alloys business in southern Africa. The Company is listed on NASDAQ OMX Helsinki (RUG1V) and the Main Market of the London Stock Exchange (RKKI).
www.ruukkigroup.com
Distribution:
NASDAQ OMX Helsinki
London Stock Exchange
main media
www.ruukkigroup.com
