DGAP-Adhoc: SGL CARBON SE: First outlook on 2016

SGL CARBON SE / Key word(s): Forecast 03.11.2015 19:08 Dissemination of an Ad hoc announcement according to § 15 WpHG, transmitted by DGAP - a service of EQS Group AG. The issuer is solely responsible for the content of this announcement. --------------------------------------------------------------------------- Wiesbaden, November 3, 2015. SGL Carbon SE will report a solid Q3/2015 in all businesses - including the graphite electrode business - on November 5, 2015, in the context of its 9M/2015 consolidated statement. However, contrary to the Group's prior expectations, the renewed deterioration in the overall steel markets is expected to have a negative impact on graphite electrode profitability going forward despite past and ongoing cost cutting measures. Due to the worsening of the overall steel markets, customers are starting to reduce and/or postpone their demand for graphite electrodes already for the fourth quarter of this year. Consequently, the earnings contribution from the Business Unit Performance Products (PP) is expected to significantly decline in the final quarter of this year compared to the first three quarters and the significant improvement in the 2015 EBIT of the Business Unit PP compared to 2014 - as previously expected - is no longer achievable; the PP EBIT 2015 is now expected to come in slightly below the 2014 level of EUR26 million (before non-recurring effects). The guidance revision relates only to the graphite electrode business. The remaining businesses are performing in line with expectations or even slightly better. Thus, the Group outlook for a significant increase in the 2015 EBIT (before non-recurring effects) compared to the EUR3 million reported in 2014 remains unchanged. Planning for 2016 is still at an early stage. From today's point of view, the Business Units Graphite Materials & Systems and Carbon Fibers & Materials as well as the cathodes business within the Business Unit PP will develop in line with SGL Group's expectations. However, the anticipated renewed price erosion in graphite electrodes will prevent a further EBIT improvement in the Business Unit PP. In fact, the graphite electrode business is anticipated to be EBIT negative in 2016, resulting in a significant deterioration of the EBIT of the Business Unit PP. The renewed downturn in the graphite electrode business confirms SGL Group's strategy to legally separate the Business Unit PP, as announced on July 7, 2015. Furthermore, it calls for accelerated implementation and thorough execution of the required measures. As a result, SGL Group is confident that the technical carve out process within the SGL Group can be completed well ahead of schedule, i.e. approximately in mid 2016. In addition, SGL Group will also speed up the process of defining and executing on strategic options for PP. Simultaneously, SGL Group is reviewing further site optimization and capacity reduction measures including potential site closures as well as further reductions in personnel from adapting its business model - this could result in additional restructuring expenses in 2015 in a mid to high double digit million EUR amount, of which the majority is expected to be non-cash. As the planning process for 2016 is still in early stages and countermeasures need to be finalized and implemented and their impact evaluated, it is not fully clear what impact the operational and structural developments will have on the 2016 Group EBIT - from today's point of view, a significant decline in EBIT (before non-recurring effects) is anticipated. --------------------------------------------------------------------------- Information and Explaination of the Issuer to this News: Important note: This 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. 03.11.2015 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: SGL CARBON SE Söhnleinstraße 8 65201 Wiesbaden Germany Phone: +49 (0)611 6029 - 0 Fax: +49 (0)611 6029 - 101 E-mail: investor-relations@sglgroup.com Internet: www.sglgroup.de ISIN: DE0007235301 WKN: 723530 Indices: SDAX Listed: Regulated Market in Frankfurt (Prime Standard); Regulated Unofficial Market in Berlin, Dusseldorf, Hamburg, Hanover, Munich, Stuttgart End of Announcement DGAP News-Service ---------------------------------------------------------------------------