ERAMET group: sales up in third-quarter 2017
(Thomson Reuters ONE) -
Paris, 24 October 2017, 8:30 am
PRESS RELEASE
ERAMET group: sales up in third-quarter 2017
* Sales in third-quarter 2017 at ?877 million, up by 23% compared with third-
quarter 2016.
* Stability in manganese ore and alloys prices since the start of the year at
sustained levels.
* Nickel prices still low but positive signs in future demand.
* Success of the ?500 million bond issue maturing in February 2024,
strengthening the Group's financial liquidity.
* Current operating income for 2017 expected to be very significantly higher
than the one of last year with a current operating income in second-half
2017 above the one of first-half 2017.
* Sales by branch of activity
--------------------------------------------+----------------------------------
Sales(1) Q3 2017 Q3 2016 Change|9 months 2017 9 months 2016 Change
(? million) |
|
ERAMET Manganese 492 353 +39%| 1,412 973 +45%
|
ERAMET Nickel 143 154 -7%| 455 409 +11%
|
ERAMET Alloys 241 206 +17%| 805 703 +15%
|
Holding company & 1 1 -| 2 2 -
eliminations |
|
ERAMET group 877 714 +23%| 2,674 2,087 +28%
--------------------------------------------+----------------------------------
(1 )Adjusted data from Group reporting in which the joint ventures are
accounted for under the proportional consolidation method. Reconciliation with
the sales published is presented in the appendices.
* ERAMET Manganese
Gross global production for carbon steel, the main outlet for manganese, was up
by 5% over the first nine months of the year compared with the same period for
2016, driven by increased demand in China (more than 5%) and the rest of the
world, mainly in Europe (nearly 6%) and India (approximately +5%). Production in
China reached a new record level in August but it should be noted that some
capacities that were never reported in the statistics were closed because they
were judged to be too polluting. Production outside China benefitted from a fall
in exports of Chinese steel, given the dynamics of the domestic Chinese market
and the strengthening of anti-dumping measures in the United States and Europe.
Demand for manganese ore was driven by these various factors and absorbed export
records out of South Africa whilst reducing the stocks in Chinese ports which
fell back down to a reasonable level of 2.3 million tonnes.
In this environment, CIF China 44% manganese ore prices (source CRU) recovered
compared with first-half 2017 (USD 5.7/dmtu) and currently remain above USD
6/dmtu. Manganese alloys prices have remained stable over this quarter.
In Moanda in Gabon, ERAMET Manganese production set a new production record at
1.14 million tonnes of manganese ore over the last 3 months, enabling Comilog to
post production of 3.1 million tonnes over the first nine months of the year, up
by 27% compared with the same period of last year and in line with the annual
target of 4 million tonnes.
* TiZir (a 50/50 joint venture with Mineral Deposits Limited)
In third-quarter 2017, TiZir recorded sales of USD 56 million, up sharply (+29%)
compared with third-quarter 2016.
Market conditions continued to strengthen throughout the quarter, with the
outlook for zircon looking particularly strong.
Heavy mineral concentrate production in Senegal came out at 196,000 tonnes in
third-quarter 2017 (+40% compared with the same period in 2016), reaching
541,000 tonnes in the first nine months. In Norway, the ramp up of the plant at
Tyssedal has been successful: titanium dioxide slag production met the
objectives set with the stable running of equipment and particularly the
furnace.
* ERAMET Nickel
Nickel stocks at the LME and SHFE have continued their gradual downward trend
over this third quarter, reaching 436,000 tonnes at end-September, down by
11,000 tonnes compared with end-June 2017.
Global stainless steel production could reach a new record at approximately 47
million tonnes, i.e. an increase of 1.8 million tonnes over a year
(approximately +4%). Performance in the second half is expected to be much
better in China after production shutdowns in the first-half of the year and
destocking effects. Consequently, nickel consumption by the stainless steel
industry looks set to increase by approximately 100,000 tonnes over the year
(approximately +7% compared with 2016).
Demand for nickel is now also driven by the excellent prospects provided by
growth in the Lithium-ion batteries sector, primarily intended for electric and
hybrid vehicles. ERAMET estimates that demand for nickel excluding stainless
steel should grow at around 5% a year over the next few years, including around
15% a year in the specific batteries sector.
In 2017, primary nickel consumption is expected to come out at around 2.2
million tonnes (approximately +6%).
Global nickel production is up slightly over 9 months compared with the same
period in 2016. The continued growth in low-grade nickel ferroalloys (nickel pig
iron) production in Indonesia largely offset the production closures decided due
to a lack of profitability. In addition, the situation in the Philippines
remains dependent on the decisions by the government on the closure of some
mines. It should be noted that local mining production in the Philippines was
down by 24% in first-half 2017 compared with 2016.
The price average therefore increased by 2.4% to USD 4.77/lb, compared with an
average of USD 4.66/lb in third-quarter 2016 and USD 4.43/lb in first-half 2017.
Nickel metallurgical production at the Doniambo plant (New Caledonia) was up by
1% at end-September 2017 compared with the same period for 2016, reaching
42,070 tonnes of nickel. The Sandouville plant is pursuing its ramp-up programme
to achieve its nominal capacity of 15,000 tonnes of high-purity nickel metal and
nickel salts.
In early September, ERAMET also announced the start of a new project to
strengthen the performance plan of its subsidiary, Société Le Nickel (SLN), in
New Caledonia. Given that achieving the objective of USD 4.5/lb set for end-
2017 is not sufficient to guarantee the company's long-term future over cycles,
a new cash-cost objective has been set at USD 4.0/lb by end-2020. This objective
will be achieved thanks to an improvement in competitiveness in two main areas:
productivity and energy costs.
* ERAMET Alloys
Sales for the Alloys branch increased sharply compared with 2016. Cumulative
sales over nine months were up from ?703 million to ?805 million, i.e. an
increase of 15%, mainly attributable to an increase in volumes observed since
the start of the year 2017 partly due to the catch-up of late deliveries of
2016 orders.
ERASTEEL continues to increase its production volumes in high-speed steels at
the same time as the ramp-up of its various projects.
In September 2017, ERAMET inaugurated EcoTitanium, Europe's first plant to
produce aerospace-grade titanium by recycling, which produces alloys from solid
scrap and cuttings collected from the major aircraft manufacturers and their
subcontractors. This project, which required an investment of ?48 million, will
offer the aerospace industry a new supply stream for titanium, which is
environmentally responsible and fully independent from existing American and
Russian suppliers.
* Financial situation
ERAMET group has satisfactory financial liquidity. This liquidity was
strengthened during this quarter with a ?500 million bond issue maturing in
February 2024. This confirms investors' confidence in the group's growth
potential and its prospects.
* Thresholds exceeded in ERAMET's capital
On 13 September 2017, the Italian banks Intesa San Paolo SpA and Unicredit SpA
announced they sold their entire stake in the Group's capital, i.e. 11.176%, to
different investors. These two banks had acquired these shares previously held
by the Carlo Tassara France holding in December 2016.
In addition, the funds Marshall Wace LLP and Schroders plc indicated that they
had exceeded the threshold of 1% of the Group's capital ownership following this
date.
* Outlook
Given, on the one hand, manganese prices which have held up well and to a lesser
extent, the recovery started in nickel prices, and on the other hand, the
progress made in productivity and cost reductions which have been achieved or
which are undergoing implementation, ERAMET's current operating income for 2017
looks set to be very significantly higher than that of 2016 with a current
operating income in second-half 2017 above that of first-half 2017.
- ooOoo -
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ABOUT ERAMET
ERAMET is one of the leading global producers of:
* alloying metals, particularly manganese and nickel, used to improve the
properties of steel;
* high-performance special steels and alloys used in industries such as
aerospace, power generation and tooling;
* mineral sands (titanium dioxide and zircon) used for pigment manufacturing
and ceramics industry.
ERAMET is also developing activities with high growth potential, such as lithium
and base metals recycling.
The Group employs approximately 13,000 people in 20 countries. ERAMET is part of
Euronext Paris Compartment A.
CONTACT
Vice-President Strategy and Investor Relations
Philippe Gundermann
Tel: +33 (0)1 45 38 42 78
Strategy and Investor Relations Analysts
Arthur Perroton - Tel: +33 (0)1 45 38 37 32
Ludovic Donati - Tel: +33 (0)1 45 38 42 88
For more information: www.eramet.com
Follow us with the ERAMET Finance mobile app:
IOS: https://itunes.apple.com/fr/app/eramet-finance/id1115212055?mt=8
Android: https://play.google.com/store/apps/details?id=com.eramet.finance
--------------------------------------------------------------------------------
APPENDICES
Appendix 1: Sales
-------------------------------------------------------------------------------
Sales (?m) Q3 2017 Q2 2017 Q1 2017 Q4 2016 Q3 2016
ERAMET Manganese 492 502 418 466 353
ERAMET Nickel 143 156 156 186 154
ERAMET Alloys 241 284 280 246 206
Holding company & eliminations 1 1 - (1) 1
ERAMET group 877 943 854 897 714
Including joint ventures
Joint ventures share (32) (36) (20) (21) (22)
ERAMET group 845 907 834 876 692
IFRS published financial statements(1)
-------------------------------------------------------------------------------
(1) Application of IFRS 11 "Joint Arrangements".
Appendix 2: Production and shipments
------------------------------------------------------+------------------------
In k tonnes Q3 2017 Q3 2016 Change|9 months 9 months Change
| 2017 2016
|
Production of manganese ore 1,146 910 +26%| 3,079 2,427 +27%
and sinter |
|
Production of manganese alloys 177 181 -2%| 539 530 +2%
|
Manganese alloy sales 172 175 -2%| 510 545 -6%
|
Heavy mineral concentrate 196 140 +40%| 541 419 +29%
production(1) |
|
Nickel production(2) 14.7 15.8 -7%| 44.0 41.6 +6%
|
Nickel sales(3) 13.7 14.0 -2%| 42.3 40.5 +4%
------------------------------------------------------+------------------------
(1) in Senegal
(2 )Ferronickel and matte until end-2016, Ferronickel and high purity nickel
from 2017
(3) Finished products
ERAMET Press release Q3 2017:
http://hugin.info/143395/R/2143683/821537.pdf
This announcement is distributed by Nasdaq Corporate Solutions on behalf of Nasdaq Corporate Solutions clients.
The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: Groupe Eramet via GlobeNewswire
Unternehmensinformation / Kurzprofil:
Datum: 24.10.2017 - 08:30 Uhr
Sprache: Deutsch
News-ID 564881
Anzahl Zeichen: 15184
contact information:
Town:
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Kategorie:
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