DGAP-News: Slight improvement for H&R AG at end of second

DGAP-News: H&R AG / Key word(s): Half Year Results Slight improvement for H&R AG at end of second quarter of 2014 14.08.2014 / 06:59 --------------------------------------------------------------------- Press release Slight improvement for H&R AG at end of second quarter of 2014 Salzbergen (Germany), 14th August 2014. The company H&R AG has slightly improved its EBITDA for the first half of 2014, despite a drop in sales. After operating profits of EUR 13.6 million in the first two quarters of 2013, the company's reported figure for the same period in 2014 was EUR 14.5 million. Domestic business obtained by its two refineries above all showed a marked recovery, thereby reinforcing the effectiveness of measures currently being applied. H&R AG generated sales amounting to EUR 540.7 million between the start of January and the end of June. This represents a drop of 8% with respect to the higher sales of the same period of the previous year (first half of 2013: EUR 587.5 million). This drop can be traced back to a chain effect caused by both prices and volume. Changes to the mode of operation of the refinery in Hamburg, with particular reference to the use of a high-quality raw material, led to lower production overall, albeit created a positive influence to the distribution ratio of main and by-products. The H&R Group's operating results (EBITDA) for the first two quarters of the 2014 fiscal year amounted, despite a downturn in sales, to a stronger EUR 14.5 million (first two quarters of 2013: EUR 13.6 million). This ratio exceeded that of the same quarter of the previous year by almost 7%. Contract manufacturing at the Salzbergen site also had a stabilising effect on financial performance, leading in turn to improved results for Germany as a whole. A stronger recovery was prevented by general pressures relating to competition and prices, which affected H&R AG particularly in the area of by-products. Development of the Group's market segments The Group's involvement in the German chemical/pharmaceutical raw materials segment generated, as a result of new raw-material and operation mode policies affecting refinery operations, a decrease of 9.5% in sales to EUR 409.9 million. (First two quarters of 2013: EUR453 million). We were at the same time pleased to report higher operating profits (EBITDA) in this segment (accompanied by moderately improved base oil prices), amounting to EUR 10.6 million. (Same two quarters of previous year: EUR 8.3 million). Sales fell somewhat in the international chemical/pharmaceutical segment, dropping by 2.1% to EUR 111.2 million (first two quarters of 2013: EUR 113.6 million). With virtually the same level of production, prices pressures above all had an effect on sales in this segment. Operating profit fell, in contrast to the figure for Germany, to EUR 6.8 million from EUR 7.4 million for the previous year, and was below our expectations. The drop of 16.9% to EUR 27.1 million (first two quarters of 2013: EUR 32.6 million), which constituted the biggest drop in sales, was attributable to the plastics segment. The restructuring phase at the Coburg (Germany) site led above all to sales and profits considerably below those of the same period of the previous year. With its deficit of EUR 1.0 million (first two quarters of 2013: EBITDA EUR 1.0 million), this segment had a detrimental effect on overall results. Financial performance of the company H&R AG was able, in the first two quarters of the 2014 fiscal year, to use the liquidity at its disposal for proactive management purposes. Measures relating to net working capital management, such as the servicing of accounts payable and reductions in inventory, have had a corresponding effect on cash flows. The balance sheet total has been reduced at the same time, reflecting in an improved equity ratio. H&R AG views its medium-term prospects in an optimistic light The price pressures affecting by-products increased considerably in the first half of 2014, and will continue to pose a challenge during the remaining months of the year. H&R has addressed this subject in terms of raw-materials management, with particular reference to the use of higher-quality input materials. The proportion of by-products in the overall product mix has been reduced. The Group is expecting significant positive effects in terms of bottom-line results, despite the higher cost of materials. Although our targets are ambitious in the light of the earnings situation in the first half of 2014, we expect that results will turn out noticeably better than those of the previous year. For further details, please refer to the Group's half-yearly report for Q1 and Q2 of 2014, published today by our Investor Relations Department and available as a PDF download from www.hur.com. An overview of the key figures for the first two quarters of 2014: <pre> H&R Group key figures (in EURm) 1.1. - 1.1. - Diff. 30.6.2014 30.6.2013* Revenue 540.7 587.5 -46.8 Operating result (EBITDA) 14.5 13.6 0.9 EBIT 3.3 1.2 2.1 Earnings before taxes -3.7 -4.3 0.6 Group's net loss / surplus after -2.7 -3.3 0.6 minority interests Consolidated earnings per ordinary -0.09 -0.11 0.02 share (EUR) Operating cash flow -32.4 32.6 -65.0 Free cash flow -40.0 23.7 -63.7 30.6.2014 31.12.2013* Diff. Balance sheet total 552.3 594.7 -42.4 Group equity 186.4 189.2 -2.8 Equity ratio (%) 33.8 31.8 2.0 </pre> * Previous year's figures amended due to retroactive application of IAS 19R <pre> 14th November 2014 Publication of report for third quarter of 2014 </pre> Contact: H&R AG, Investor Relations / Kommunikation, Ties Kaiser Neuenkirchener Straße 8, 48499 Salzbergen Phone.: +49 40 43218-321, Fax: +49 40 43218-390 Mail: Ties.Kaiser@hur.com www.hur.com H&R AG is a Prime Standard listed specialist chemicals company. It develops and manufactures crude oil-based chemical and pharmaceutical products and high-precision plastic parts. Forward-looking statements and forecasts: This press release contains forward-looking statements. These statements are based on current estimates and forecasts made by the Executive Board and the information available to the Board at this time. Forward-looking statements should not be interpreted as guarantees that the projected future developments and results will materialise. Future developments and results are dependent on a range of factors. They comprise various risks and imponderables and rest on assumptions which may prove incorrect. We do not accept any obligation to update the forward-looking statements made in this ad-hoc communication. --------------------------------------------------------------------- 14.08.2014 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. The DGAP 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: H&R AG Neuenkirchener Str. 8 48499 Salzbergen Germany Phone: +49 (0)40 43 218 321 Fax: +49 (0)40 43 218 390 E-mail: investor.relations@hur.com Internet: www.hur.com ISIN: DE0007757007 WKN: 775700 Listed: Regulierter Markt in Düsseldorf, Frankfurt (Prime Standard), Hamburg; Freiverkehr in Berlin, Hannover, München, Stuttgart End of News DGAP News-Service --------------------------------------------------------------------- 282195 14.08.2014