DGAP-News: SKW Stahl-Metallurgie Holding AG: Operative

DGAP-News: SKW Stahl-Metallurgie Holding AG / Key word(s): Quarter Results SKW Stahl-Metallurgie Holding AG: Operative EBITDA margin up to 9.1% in Q3 15.11.2013 / 07:09 --------------------------------------------------------------------- Operative EBITDA margin up to 9.1% in Q3 * Adjusted operative EBITDA improves from EUR 4.1 million to EUR 7.9 million in Q3 * Positive free cash flow employed to further reduce net financial debt * Outlook for 2013 reiterated - confident for 2014 Unterneukirchen (Germany), November 15, 2013. The global specialty chemicals group SKW Metallurgie has increased its profitability significantly in the first nine months of 2013. The operative EBITDA margin increased after three quarters from 5.3% in 2012 to 6.7% in 2013; and in the third quarter, it increased from 4.3% (Q3 2012) to 9.1%. In absolute figures, operative EBITDA also improved, both in the nine-month period (9M 2013: EUR 17.6 million; 9M 2012: EUR 16.9 million) as well as in the third quarter (Q3 2013: EUR 7.9 million; Q3 2012 EUR 4.1 million). This success was possible even though the Group was confronted with a downturn in steel production on the particularly important markets in the EU (-4.2%), USA (-4.0%) and Brazil (-0.6%). Lower steel production and other external influences on currencies and raw materials meant that nine-month revenues fell to EUR 262.9 million (9M 2012: EUR 315.4 million) and in the third quarter to EUR 86.7 million (Q3 2012: EUR 95.4 million). In order to increase the operative focus of our financial reporting, adjustments were made in the period under review. These related, in particular, to non-realized (thus non-cash) currency effects, mostly in valuing inter-company, longer-term loans. The special factors adjusted were substantially negative in the nine-month period at EUR 2.7 million; however in 9M 2012 they were significantly positive at EUR 3.0 million. Ines Kolmsee, the SKW Metallurgie Group's CEO, commented: 'We have consistently started to implement our efficiency program 'Every Penny Counts' (EPC). We are expecting notable successes already in 2014. If economic growth is stable, these should bring us back to our former profitability with EBITDA margins of more than seven percent.' Accelerated debt reduction thanks to high free cash flow The SKW Metallurgie Group's capital expenditure has been reduced substantially now that the expansion and investment phase has been completed. As a result, and thanks to efficient net working capital management as well as solid operating results, free cash flow in the first nine months rose by EUR 18.3 million to EUR 13.0 million. These funds have been used, as announced, to reduce net financial debt. This fell faster than expected from EUR 73.9 million at the end of 2012 to EUR 65.4 million (September 30, 2013). The Group continues to have excellent financials with an equity ratio of 42.4% (end of 2102: 40.2%) and gearing of 0.58 (December 31, 2012: 0.61). Outlook: Operative EBITDA higher than previous year - confidence for 2014 Steel production is not expected to recover notably in the last quarter of the year. As a result, the Group is continuing to forecast consolidated sales for 2013 that will not reach the previous year's figure (EUR 404.6 million), as a result of the economy. Operative EBITDA after the first nine months of 2013 already totaled EUR 17.6 million. As a result, the Executive Board is forecasting operative EBTIDA in 2013 as a whole to at least meet the previous year's figure of EUR 19.5 million. The free cash flow is also expected to be significantly positive in the year as a whole, which will lead to net financial debt which is lower than the previous year. From 2014, as announced, significant EBITDA increases are expected from the efficiency program 'Every Penny Counts' (EPC), which was launched in the current year. As a result, if economic growth is stable, the Group aims to return to its former profitability with EBITDA margins of more than seven percent. The report on the first three quarters of 2013 and further information on the Group can be found online at: www.skw-steel.com. Contact SKW Stahl-Metallurgie Holding AG Christian Schunck Head of IR and Corporate Communications Rathausplatz 11 84579 Unterneukirchen Germany Telephone IR/Press: +49 89 5998923-22 Fax: +49 89 5998923-29 E-mail: schunck@skw-steel.com Internet: www.skw-steel.com About SKW Stahl-Metallurgie Holding AG The SKW Metallurgie Group 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, Brazil, South Korea, Sweden, Bhutan, Russia, 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 (from August 15, 2011: new ISIN DE000SKWM021). 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. KPIs for SKW Metallurgie Group after the first three quarters of 2013 (in EUR million) <pre> 9M 2013 9M 2012 Q3 2013 Q3 2012 External revenues 262.9 315.4 86.7 95.4 - thereof Cored Wire 121.3 143.9 40.3 41.9 - thereof Powder and Granules 124.9 149.8 41.6 46.4 EBITDA (operative) 1 17.6 16.9 7.9 4.1 Gross margin 32.1% 29.4% 33.8% 30.5% EBITDA margin (operative) 1 6.7% 5.3% 9.1% 4.3% EBIT (operative) 1 9.3 9.4 5.1 1.5 Earnings before taxes (operative) 1 5.9 6.4 4.1 0.5 Consolidated net income for the period (SKW) 1.7 5.7 1.2 1.4 Earnings per share in EUR 2 0.25 0.87 0.18 0.21 Cash flow from operating activities 9.7 8.5 Free cash flow 13.0 -5.3 Sept. 30, 2013 Dec. 31, 2012 Total assets 266.4 299.6 Equity ratio (incl. non-controlling interests) 112.9 120.6 Net financial debt 65.4 73.9 Gearing 3 0.58 0.61 Equity ratio (incl. non-controlling interests) 42.4% 40.2% Employees as of Sept. 30 1,022 1,167 </pre> Taking the changes under IAS 19 into account, figures for 2012 adjusted accordingly (1) The adjustments made related, in particular, to non-realized currency effects thus not recognized in income, mostly in valuing inter-company, longer-term loans. (2) Based on an unchanged number of 6,544,930 shares (3) Net financial debt to equity (incl. non-controlling interests) End of Corporate News --------------------------------------------------------------------- 15.11.2013 Dissemination of a Corporate News, transmitted by DGAP - a company of EQS Group AG. The issuer is solely responsible for the content of this announcement. DGAP's Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Media archive at www.dgap-medientreff.de and www.dgap.de --------------------------------------------------------------------- Language: English Company: SKW Stahl-Metallurgie Holding AG Rathausplatz 11 84579 Unterneukirchen Germany Phone: +49 (0)8634 62720-15 Fax: +49 (0)8634 62720-16 E-mail: info@skw-steel.com Internet: www.skw-steel.com ISIN: DE000SKWM021 WKN: SKWM02 Listed: Regulierter Markt in Frankfurt (Prime Standard); Freiverkehr in Berlin, Düsseldorf, Hamburg, München, Stuttgart End of News DGAP News-Service --------------------------------------------------------------------- 240080 15.11.2013