DGAP-News: SGL CARBON SE: SGL Group with solid performance in H1
(firmenpresse) - DGAP-News: SGL CARBON SE / Key word(s): Half Year Results
SGL CARBON SE: SGL Group with solid performance in H1
09.08.2012 / 08:35
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SGL Group with solid performance in H1
- Sales increased 12% to EUR810 million, EBIT at EUR73 million in the
first half 2012
- Performance Products and Graphite Materials&Systems in line with
expectations, Carbon Fibers&Composites affected by delayed projects
and developments
- Balance sheet structure affected by acquisition of Fisipe and
successful placement of convertible bond
- Outlook for full year 2012: Improvement in Group sales, EBIT
approximately EUR160 million
Wiesbaden, August 9, 2012. The operating performance of the three Business
Areas of the SGL Group - The Carbon Company - showed a mixed picture in the
first half of 2012 against the backdrop of a still challenging economic
environment. While Performance Products (PP) and Graphite Materials&Systems (GMS) developed in line with expectations, Carbon Fibers&Composites (CFC) was affected by delayed projects and developments. Group
sales improved by 12% to EUR809.8 million (H1/2011: EUR725.0 million).
Excluding the initial consolidation of the recently acquired Portuguese
subsidiary Fisipe, the increase was 8%. EBIT in H1/2012 amounted to EUR73.0
million compared to EUR76.2 million in the same period one year earlier.
The positive development in the established Business Areas PP and GMS -
which together increased EBIT by approximately 14% - was largely offset by
the unexpected earnings decline in the Business Area CFC. Therefore and due
to ongoing uncertainties concerning the further global economic
development, SGL Group expects EBIT for the Group for full-year 2012 to be
in the range of EUR160 million - comparable to the 2011 EBIT. Based on the
assumption of a global economic recovery in the second half of 2012 the
company continues to anticipate improvements in Group sales compared to the
previous year.
Robert Koehler, CEO of SGL Group: 'Our traditional and established Business
Areas PP and GMS have developed positively within the framework of our
expectations. Unfortunately, we see delays in developments and projects
related to the known areas of aviation, energy and industrial applications
affecting the build up of our CFC business. This is not unusual for market
introductions in uncertain economic times. Irrespective of this we expect a
Group EBIT for the full year 2012 to match last year's level of EUR 160
million.'
Profit before taxes slightly improved
The net financing result remained virtually unchanged at minus EUR24.7
million compared to the prior year period. As the improvement in the result
from At-Equity accounted investments was able to compensate for the slight
decline in EBIT, first half 2012 pre-tax profit of EUR41.1 million was
almost unchanged (H1/2011: EUR40.7 million). Due to higher tax computations
in the reporting period, net profit attributable to the shareholders of
the parent company decreased to EUR23.7 million (H1/2011: EUR35.0
million). Based on an average number of shares of 70.2 million, basic
earnings per share amounted to EUR0.34 (H1/2011: EUR0.53).
Balance sheet affected by acquisition of Fisipe and issue of convertible
bond
Total assets as of June 30, 2012 increased by 11% to EUR2,528.4 million
compared to December 31, 2011, primarily due to the acquisition of the
Portuguese fiber producer Fisipe as well as the issue of a new convertible
bond to strengthen the financing structure in April 2012. Shareholders'
equity improved by 6% to EUR1,104.1 million. The equity ratio consequently
decreased from 45.8% to 43.7%. Net financial debt rose significantly by 63%
to EUR558.6 million (December 31, 2011: EUR343.3 million) due to the
inventory build-up driven increase in working capital as well as the
acquisition of Fisipe and further financing for At-Equity investments.
Correspondingly, gearing increased from 0.33 to 0.51 which is still in line
with the Group target of approximately 0.5. SGL Group continued to
consistently pursue its growth strategy which is reflected in an increase
of capital expenditure from EUR41.2 million to EUR48.5 million - in
addition to payments for At-Equity joint ventures of EUR27.7 million
(H1/2011: EUR9.7 million) and payments related to the acquisition of Fisipe
of EUR30.6 million. In total, free cash flow in H1/2012 decreased to minus
EUR171.6 million (H1/2011: minus EUR58.3 million).
Segment reporting
Performance Products (PP): ROS improved to 18.3%
In the Business Area Performance Products (PP), sales increased by 6% to
EUR413.1 million (H1/2011: EUR388.1 million). Graphite electrode volumes in
the first half of 2012 remained below the previous year's level due to the
weaker first quarter. However, the effect from the lower graphite electrode
volumes was compensated by higher selling prices. The recovery in cathode
volumes, which began in the middle of last year, continued in the reporting
period - however at expected lower selling prices. EBIT increased by 21% to
EUR75.5 million in the first half 2012 compared to EUR62.6 million in the
same period one year earlier, mainly due to higher graphite electrode
prices and increased cathode sales volumes as well as savings from the SGL
Excellence initiative of approximately EUR4.5 million. Start-up costs for
the commissioning of the new Malaysian production facility continued to
weigh on earnings in the reporting period. Return on sales improved to
18.3% (H1/2011: 16.1%).
Graphite Materials&Systems (GMS) with continued strong performance
In the Business Area Graphite Materials&Systems (GMS), sales grew by 12%
to EUR252.8 million (H1/2011: EUR226.0 million) due to a broad materials
base which was able to more than compensate for the cyclical downturn in
the solar and LED industries. The Business Unit Process Technology also
continued its positive development based on a record order backlog at the
end of 2011. EBIT improved by approximately 4% and thus less than
proportionately to sales from EUR39.9 million in H1/2011 to EUR41.3 million
in H1/2012, resulting in a return on sales of 16.3% (H1/2011: 17.7%). The
predicted slight deterioration of the ROS is primarily the result of lower
fixed cost absorption. Capacity utilization in the first half year 2012 was
lower compared to the very high level of H1/2011, as GMS has adjusted
production to the lower order intake levels recorded since the fourth
quarter of last year. Savings from the SGL Excellence initiative amounted
to approximately EUR4 million in the first half of 2012.
Carbon Fibers&Composites (CFC) in a challenging environment
Sales in the Business Area Carbon Fibers&Composites (CFC) increased by
32% to EUR142.9 million (H1/2011: EUR107.9 million) including an initial
sales contribution of EUR29.8 million from the newly acquired Fisipe. The
like-for-like sales growth of 5% was attributable to higher sales in the
Business Unit Rotor Blades compared to the weak previous year period and
was partially offset by lower sales in the Business Units Carbon Fibers&Composite Materials (CF/CM) and Aerostructures (AS). EBIT in the CFC
Business Area amounted to minus EUR16.5 million compared to minus EUR4.2
million in the same period one year earlier. The lower result is due to the
continued negative earnings situation of the wind/rotor blade business, the
reduced capacity utilization in the carbonfiber business, where continued
project shifts resulted in lower material demand from the wind industry and
delays in the aerospace and defense industries (Boeing 787, Joint Strike
Fighter). Cost savings from SGL Excellence amounted to approximately EUR4
million. Return on sales was minus 11.5% compared to minus 3.9% in the same
period of the previous year.
Sales of the At-Equity accounted investments within the Business Area
Carbon Fibers&Composites increased by 35% to EUR74.0 million (H1/2011:
EUR54.8 million, 100% values for companies). These sales are not included
in the consolidated Group sales figure.
Outlook 2012 adjusted due to adverse development in Business Area CFC
Based on the assumption that the world economy may begin to pick up pace in
the second half 2012, SGL Group continues to guide to improvements in Group
sales for the full year 2012 compared to the previous year. However, this
assumption is subject to risk. Despite the Business Areas PP and GMS
performing in line with guidance, the company now expects Group EBIT in the
full year 2012 to remain on the 2011 level of approximately EUR160 million
due to the higher than initially planned losses in the Business Area CFC.
Regarding the development in the Business Areas, SGL Group continues to
anticipate an increase in sales of PP at comparable margins. For GMS, the
company expects sales to remain on last year's level and a return on sales
which will be significantly higher than the medium-term target of at least
10%. In the Business Area CFC, losses in the full year 2012 will be higher
than in 2011 due to the difficult market situation in the Business Unit
Rotor Blades, project delays in the military and civil aviation industries
as well as delayed material demand from the wind industry, caused mainly by
the production facility shutdown of a major customer. Nevertheless, CFC
expects the losses to improve in the second half compared to the first half
of this year. Generally, the Business Area continues to be characterized by
a strong R&D driven substitution trend, which can lead to delays and to
start-up/development expenses, which may partially not be projectable until
a certain commercial maturity is reached. However, there is no change to
the considerable long-term growth potential in this material segment.
The mid-term gearing target of approximately 0.5 remains top priority. It
will continue to be the governing indicator defining the investment
program. The largest projects in this investment program are scheduled to
be completed this year. Accordingly, SGL Group forecasts capital
expenditure in plant, property and equipment and intangible assets to be up
to EUR150 million in 2012 (including Fisipe) which will largely be funded
from operational cash flow. The company continues to anticipate free cash
flow to be up to minus EUR60 million in fiscal 2012 (before acquisitions
and dividend payment for fiscal year 2011). When including payments
relating to the acquisition of Fisipe, SGL Group expects free cash flow in
the full year 2012 (before dividend payment for fiscal year 2011) to amount
to approximately minus EUR 115 million. With capital expenditure forecasted
to decline in the future, the company seeks to again be free cash flow
positive (before acquisitions) in 2013.
Additional information about SGL Group and the report of the first half
2012 can be found at: www.sglgroup.com.
Key figures of SGL Group for the first half 2012
(in EURm)
H1-2012 H1-2011 Change
Sales revenue 809.8 725.0 11.7 %
Gross profit 212.7 199.7 6.5 %
EBITDA 111.3 110.3 0.9 %
Operating profit (EBIT) 73.0 76.2 -4.2 %
Return on sales (ROS) 1 9.0% 10.5% -
Profit before tax 41.1 40.7 1.0 %
Net profit attributable to shareholders of the parent 23.735.0 -32.3%
company
Earnings per share, basic (in EUR) 0.34 0.53 -35.8%
Capital expenditure on property, plant and equipment 48.5 41.2 17.7 %
and intangible assets
Free Cash Flow -171.6 -58.3 -
June 30,2012 Dec. 31,2011 Change1- Ratio of EBIT to sales revenue
Total assets 2,528.4 2,271.3 11.3 %
Shareholders' equity 1,104.1 1,041.1 6.1 %
Net financial debt 558.6 343.3 62.7 %
Gearing 2 0.51 0.33 -
Equity ratio 3 43.7% 45.8% -
Employees 6,677 6,447 3.6 %
2- Ratio of net financial debt to shareholders' equity
3- Ratio of shareholders' equity to total assets
About SGL Group - The Carbon Company
SGL Group is one of the world's leading manufacturers of carbon-based
products and materials. It has a comprehensive portfolio ranging from
carbon and graphite products to carbon fibers and composites. SGL Group's
core competencies are its expertise in high-temperature technology as well
as its applications and engineering know-how gained over many years. These
competencies enable the Company to make full use of its broad material
base. SGL Group's carbon-based materials combine several unique properties
such as very good electrical and thermal conductivity, heat and corrosion
resistance as well as high mechanical strength combined with low weight.
Due to industrialization in the growth regions of Asia and Latin
America and increased substitution of traditional with innovative
materials, there is a growing demand for SGL Group's high-performance
materials and products. Products from SGL Group are used predominantly in
the steel, aluminum, automotive and chemical industries as well as in the
semiconductor, solar and LED sectors and in lithium-ion batteries.
Carbon-based materials and products are also being used increasingly in the
wind power, aerospace and defense industries.
With 47 production sites in Europe, North America and Asia as well as a
service network covering more than 100 countries, SGL Group is a company
with a global presence. In 2011, the Company's workforce of around 6,500
employees generated sales of EUR1,540 million. The Company's head office is
located in Wiesbaden.
Further information on the SGL Group can be found online at:
www.sglgroup.com.
Important note:
This press release may contain forward-looking statements based on the
information currently available to us and on our current projections and
assumptions. By nature, forward-looking statements involve known and
unknown risks and uncertainties, as a consequence of which actual
developments and results can deviate significantly from these
forward-looking statements. Forward-looking statements are not to be
understood as guarantees. Rather, future developments and results depend on
a number of factors; they entail various risks and unanticipated
circumstances and are based on assumptions which may prove to be
inaccurate. These risks and uncertainties include, for example,
unforeseeable changes in political, economic, legal, and business
conditions, particularly relating to our main customer industries, such as
electric steel production, to the competitive environment, to interest rate
and exchange rate fluctuations, to technological developments, and to other
risks and unanticipated circumstances. Other risks that in our opinion may
arise include price developments, unexpected developments connected with
acquisitions and subsidiaries, and unforeseen risks associated with ongoing
cost savings programs. SGL Group does not intend or assume any
responsibility to revise or otherwise update these forward-looking
statements.
Your contact:
Corporate Communication /Tino Fritsch
Telephone +49 611 6029 105 / Fax +49 611 6029 101 / Cell +49 170 540 2667
E-mail: tino.fritsch(at)sglcarbon.de / www.sglgroup.com
End of Corporate News
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Language: English
Company: SGL CARBON SE
Soehnleinstraße 8
65201 Wiesbaden
Germany
Phone: +49 (0)611 6029 - 103
Fax: +49 (0)611 6029 - 101
E-mail: investor-relations(at)sglcarbon.de
Internet: www.sglgroup.com
ISIN: DE0007235301
WKN: 723530
Indices: MDAX
Listed: Regulierter Markt in Frankfurt (Prime Standard);
Freiverkehr in Berlin, Düsseldorf, Hamburg, Hannover,
München, Stuttgart
End of News DGAP News-Service
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