DGAP-IRE: SCHULER AG: Interim announcement within second

SCHULER AG / Release of an announcement according to Article 37x of the WpHG [the German Securities Trading Act] 07.08.2013 08:01 Interim report according to Article 37x of the WpHG, transmitted by DGAP - a company of EQS Group AG. The issuer is solely responsible for the content of this announcement. --------------------------------------------------------------------------- EXPECTED DECLINE IN NEW ORDERS There was an expected decline in new orders during the first nine months of fiscal year 2012/13. With a volume of EUR 836.5 million, orders were 20.1% down from the high prior-year figure of EUR 1,046.3 million. New orders in the third quarter were down 15.4% year on year at EUR 235.0 million. Orders have since returned to a sound level. Domestic business declined by 21.3% to EUR 362.2 million in the first nine months. Its proportion of total new orders remained virtually unchanged at 43.3%. In the third quarter, new orders in Germany fell by 46.3% to EUR 82.8 million. The same quarter last year included a major order for two press lines. Orders from the American market were very encouraging. In the first nine months, they grew by 31.9% to EUR 171.2 million. This growth in new orders was particularly strong in the third quarter with a year-on-year increase of 159.2% and an order volume of EUR 74.9 million. This figure includes an order to supply a six-station press line with ServoDirect Technology to Mexico. Although there was an increase in orders in the third quarter compared to the previous year by 13.4% to EUR 22.8 million, orders from the rest of Europe were down 41.3% year on year to EUR 93.4 million. There was also a noticeable decline in demand from Asian customers. In the first nine months, new orders decreased by 32.3% to EUR 198.7 million. Asia is still the second largest sales market after Germany, accounting for 23.8% of total orders. At EUR 46.9 million, new orders in the third quarter were down 36.0% from the same quarter last year. The proportion of orders received from foreign markets remained almost constant at 56.7% in the first nine months of 2012/13, compared with 56.0% in the same period last year. <pre> NEW ORDERS IN EUR MILLION 9 months 9 months 3rd quarter 3rd quarter 2012/13 2011/12 2012/13 2011/12 Germany 362.2 460.0 82.8 154.3 Europe (excl. Germany) 93.4 159.2 22.8 20.1 America 171.2 129.8 74.9 28.9 Asia 198.7 293.4 46.9 73.3 Other regions 11.0 3.9 7.6 1.0 New orders 836.5 1,046.3 235.0 277.6 </pre> ORDER BACKLOG STABLE AT AROUND EUR 1.1 BILLION Order backlog as of June 30, 2013, stood at EUR 1,095.5 million. It was almost unchanged from the figure as of September 30, 2012 (EUR 1,110.6 million). The difference amounts to just 1.4%. The order backlog in Germany rose by 10.1% to EUR 499.6 million as of June 30, 2013, while the foreign order backlog fell by 9.3% to EUR 595.9 million. The order backlog from European customers (excluding Germany) was down 30.2% at EUR 113.9 million. In the Americas, there was strong growth of 23.2% in order backlog to EUR 147.2 million. The order backlog in Asia declined by 13.0% to EUR 324.0 million. The Asian markets accounted for 29.6% of existing orders - the second highest after Germany. <pre> ORDER BACKLOG IN EUR MILLION 06/30/2013 09/30/2012 Germany 499.6 453.9 Europe (excl. Germany) 113.9 163.1 America 147.2 119.5 Asia 324.0 372.5 Other regions 10.8 1.6 Order backlog 1,095.5 1,110.6 </pre> SLIGHT YEAR-ON-YEAR DECLINE IN CONSOLIDATED SALES In the first nine months of fiscal year 2012/13, consolidated sales of the Schuler Group were down slightly by 3.0% year on year at EUR 851.6 million (prior year: EUR 877.8 million). There was encouraging growth in domestic sales both in the first nine months as well as in the third quarter. For the nine-month period, Schuler generated sales growth of 14.4% to EUR 316.5 million in Germany. Growth in the third quarter amounted to 7.7%. The strongest growth rates were achieved in America, where we were able to complete several major projects. Sales rose by 13.1% to EUR 143.5 million in this region during the first nine months. In the third quarter, sales were down 1.1% year on year at EUR 46.9 million. European sales (excluding Germany) fell by 14.4% to EUR 142.6 million in the first nine months and by 30.1% to EUR 34.1 million in the third quarter. There was also a decline in revenues from Asian customers of -18.8% to EUR 247.3 million in the first nine months. In the third quarter, sales decreased by 22.7% to EUR 76.5 million in this region. All in all, foreign business accounted for 62.8% of total sales in the reporting period, compared with 68.5% in the previous year. Despite this slight shift, Schuler still generates the majority of its revenue outside Germany. <pre> SALES IN EUR MILLION 9 months 9 months 3rd quarter 3rd quarter 2012/13 2011/12 2012/13 2011/12 Germany 316.5 276.7 107.2 99.5 Europe (excl. Germany) 142.6 166.6 34.1 49.2 America 143.5 126.9 46.9 47.4 Asia 247.3 304.3 76.5 99.0 Other regions 1.7 3.4 0.7 1.9 Sales 851.6 877.8 265.4 297.0 </pre> EARNINGS POSITION In the fiscal year 2011/12, the Schuler Group adopted IAS 19 rev. (2011) 'Employee Benefits' in advance of its effective date. The prior-year figures include effects from the adoption of IAS 19 rev. (2011). The published figures for the first nine months of 2011/12 do not yet include these effects. PROFITABILITY REMAINS HIGH In the third quarter of fiscal year 2012/13, the Schuler Group generated sales of EUR 265.4 million (prior year: EUR 297.0 million). Overall, revenues in the first nine months amounted to EUR 851.6 million (prior year: EUR 877.8 million). Total performance in the period under review fell from EUR 908.2 million to EUR 862.9 million. In the first nine months of the current fiscal year, the cost of materials amounted to EUR 378.9 million (prior year: EUR 447.1 million). Based on total performance, the cost of materials ratio fell year on year from 49.2% to 43.9%. This decline was due to falling commodity prices and the successful global pooling of procurement activities, which led to improved terms, and the increased average percentage of completion for long-term construction contracts (with a relatively lower level of material expense). Personnel expenses increased by 5.5% to EUR 284.6 million (prior year: EUR 269.7 million). As a result of the decrease in total performance, the personnel expense ratio rose from 29.7% to 33.0% with a moderate increase in headcount. In the final analysis, the Schuler Group's level of profitability remains very strong. EBITDA amounted to EUR 83.1 million (prior year: EUR 84.1 million) and the EBITDA margin stood at 9.8% (prior year: 9.6%). After deduction of depreciation and amortization, the EBIT result reached EUR 65.5 million (prior year: EUR 68.2 million). Compared to the previous year, the interest result improved by EUR 6.3 million to EUR -6.7 million. Consequently, EBT rose from EUR 55.2 million to EUR 58.8 million. After deduction of income taxes, the group profit for the first nine months of the fiscal year amounted to EUR 34.6 million (prior year: EUR 34.5 million). <pre> CONDENSED INCOME STATEMENT IN EUR MILLION 3rd 3rd 9 months 9 months quarter quarter 2012/13 2011/12 2012/13 2011/12 1) 1) Sales 851.6 877.8 265.4 297.0 EBITDA 83.1 84.1 25.0 28.9 Depreciation, amortization and impairments/impairment reversals of non-current assets, shares in affiliated ­companies and investments 17.6 15.9 5.2 5.3 EBIT 65.5 68.2 19.8 23.6 Interest result -â??6.7 -â??13.0 -â??1.9 -â??3.1 EBT 58.8 55.2 18.0 20.4 Income taxes 24.2 20.7 5.9 7.6 Group profit or loss 34.6 34.5 12.0 12.8 </pre> 1) Prior-year figures were adjusted in accordance with IAS 19 rev. (2011). FINANCIAL POSITION VERY HEALTHY FINANCIAL STATUS <pre> CONDENSED STATEMENT OF CASH FLOWS IN EUR MILLION 3rd 3rd 9 months 9 months quarter quarter 2012/13 2011/12 2012/13 2011/12 1) 1) Profit or loss for the year 34.6 34.5 12.0 12.8 Depreciation, amortization and impairments/impairment ­reversals of non-current assets, shares in affiliated ­companies and investments 17.6 15.9 5.2 5.3 Changes Net working capital 78.7 -â??18.0 13.6 -â??46.5 Provisions/other 5.6 9.7 -â??0.6 9.2 Cash flow from operating activities 136.5 42.2 30.3 -â??19.2 Capital expenditures -â??24.2 -â??16.9 -â??6.0 -â??7.5 Other 2.5 -â??20.0 0.7 -â??0.2 Cash flow from investing activities -â??21.7 -â??36.9 -â??5.4 -â??7.7 Proceeds from/redemption of financial liabilities 10.4 -â??14.4 -â??7.5 -â??10.0 Other -â??2.7 -â??5.0 -â??3.3 -â??5.8 Cash flow from financing activities 7.7 -â??19.4 -â??10.7 -â??15.8 Change in cash and cash equivalents 122.5 -â??14.2 14.2 -â??42.6 +/- Change in cash and cash equivalents due to exchange rate fluctuations -â??2.3 -â??0.1 -â??2.8 -â??1.3 Net change in cash and cash equivalents 120.2 -â??14.2 11.4 -â??43.9 </pre> 1) Prior-year figures were adjusted in accordance with IAS 19 rev. (2011). In the first nine months of fiscal year 2012/13, the Schuler Group generated cash flow from operating activities of EUR 136.5 million, compared to EUR 42.2 million in the previous year. While this increase of EUR 94.3 million was due to a corresponding change in net working capital, it was mainly the result of an increase in payments on account received from customers. Cash flow from investing activities amounted to EUR -21.7 million (prior year: EUR -36.9 million). Whereas the prior-year figure was dominated by a one-off payment of EUR 20.0 million for the open purchase price obligation pertaining to the purchase of Müller Weingarten AG, the main items in the reporting period concerned capital expenditures. In the first nine months of the reporting year 2012/13, cash flow from financing activities amounted to EUR 7.7 million (prior year: EUR -19.4 million). This positive balance resulted mainly from the assumption of bank liabilities by our Brazilian and Chinese subsidiaries in order to finance customer orders. In the third quarter, a total dividend of EUR 3.3 million was paid to the shareholders of Schuler AG (prior year: EUR 5.8 million). The prior-year figure includes the premature repayment of a subordinated loan taken out by Schuler AG amounting to EUR 15.0 million. All in all, there was a change in cash and cash equivalents of EUR 122.5 million (prior year: EUR -14.2 million). After accounting for changes due to currency fluctuations, cash and cash equivalents increased from EUR 222.4 million as of June 30, 2012, to EUR 309.3 million. In the first nine months of fiscal year 2012/13, net liquidity improved year on year from EUR 139.1 million to EUR 214.6 million. ASSETS POSITION ASSET PROFILE REMAINS STABLE <pre> CONDENSED STATEMENT OF FINANCIAL POSITIONS IN EUR MILLION 06/30/ 09/30/ 2013 2012 Assets 985.6 902.7 A. Non-current assets 268.2 283.2 of which intangible assets, property, plant and equipment, interests in affiliates and participations 238.7 233.6 B. Current assets 717.4 619.5 of which inventories 141.4 131.7 of which trade receivables and future receivables from long-term construction contracts 207.3 239.5 of which cash and cash equivalents 309.3 189.2 Liabilities 985.6 902.7 A. Shareholders' equity 276.9 244.6 B. Non-current liabilities 163.8 178.9 of which financial liabilities 36.6 57.1 of which pension provisions 100.6 97.6 of which other provisions 14.8 16.0 C. Current liabilities 544.9 479.2 of which financial liabilities 58.1 31.9 of which trade payables 56.8 86.9 of which other liabilities 335.5 270.0 of which other provisions 87.8 80.0 </pre> Compared to the beginning of the fiscal year, the balance sheet total increased from EUR 902.7 million to EUR 985.6 million. On the asset side, cash and cash equivalents rose by EUR 120.2 million - particularly because of payments on account received. Receivables from long-term construction contracts fell by EUR 24.5 million to EUR 132.9 million. This decline was, in large part, due to the increase in payments on account from customers. These are netted with gross receivables from long-term construction contracts and rose disproportionately to gross receivables. On the liabilities side, the main changes during the first nine months of fiscal year 2012/13 were among the current liabilities. The increase in current liabilities of EUR 65.5 million to EUR 335.5 million was primarily due to payments on account received (EUR 65.2 million). The rise in current financial liabilities of EUR 26.3 million to EUR 58.1 million resulted mainly from the assumption of bank liabilities to finance operations in Brazil. In contrast to this, there was a decline in non-current financial liabilities of EUR 20.5 million to EUR 36.6 million. Due to the healthy consolidated profit in the first nine months of the reporting period, ­shareholders' equity rose by EUR 32.3 million or 13.2% to EUR 276.9 million. The equity ratio increased from 27.1% to 28.1%. PERSONNEL MODERATE EMPLOYMENT GROWTH In the first nine months of the current fiscal year, there was a moderate increase in headcount. As of June 30, 2013, we employed 5,563 people, which is 2.2% more than on September 30, 2012. The strongest growth in headcount (89 employees) was in China. As of June 30, 2013, we employed 313 people at our facilities in Shanghai and Dalian. This is an increase of 40%. Around half of this growth results from a statistical effect, as our sales & service company in Shanghai has been included in the consolidated group as of October 1, 2012. This led to an increase in personnel of 45. We are steadily growing headcount in China with the intention of increasing the amount of value added at these facilities. There has been an increase of 44 staff in total since October 1, 2012, mainly in our production and service divisions. The number of employees at our facilities in Germany rose by 1.1% to 4,281. As of the reporting date, 83 people were employed at our European sites outside of Germany - representing a decline of nine persons compared to September 30, 2012. Headcount in the Americas also fell slightly to 886 employees (September 30, 2012: 891). <pre> EMPLOYEES BY SEGMENTS INCLUDING APPRENTICES 06/30/2013 09/30/2012 Schuler Group in total 5,563 5,443 Forming Systems 3,907 3,881 Automation 591 576 Tools 351 348 Others (incl. Schuler AG) 714 638 </pre> The Forming Systems segment remains the Group's largest employer, accounting for 70.2% of total headcount. As of June 30, 2013, Forming Systems employed 3,907 people, which amounts to 0.7% more than at year-end 2011/12. FOCUS ON YOUTH DEVELOPMENT The training and education of its young employees is of significant importance to Schuler. Our aim is to develop skilled specialists for our specific needs and promote their long-term retention. An additional focus is our ongoing staff training via a number of targeted measures. Our group-wide training program aims to reflect the changing requirements made of staff and to equip them with the best possible skills for their respective tasks. SCHULER TRAINING CENTER IN MEXICO OPENED The Mexican Governor Rafael Moreno Valle Rosas and Germany's Federal Minister for Economic Cooperation and Development Dirk Niebel officially opened the new vocational training center Cedual (Centro de Especialización Dual) at Schuler's Puebla facility in Mexico on June 22, 2013. With the new Cedual center, Schuler is introducing Germany's successful dual education and training system in Mexico in order to actively counter the lack of skilled staff. The first 30 apprentices began their courses in September 2012. The second intake of students will start soon. The new Schuler training center has enough space to jointly train a total of 90 industrial mechanic and tool mechanic apprentices according to the German system. This opportunity is, to date, being utilized by one Spanish and five German companies. On completing their three-year course, the future skilled workers are awarded a certificate from the Chamber of Commerce and Industry (IHK). This is equivalent to the qualification received in Germany. As of June 30, 2013, the Schuler Group employed 271 apprentices. The decline compared to September 30, 2012, results from the completion of numerous apprenticeships and their conversion to full-time employment contracts. <pre> APPRENTICES BY SEGMENT 06/30/2013 09/30/2012 Schuler Group in total 271 318 Forming Systems 206 241 Automation 21 30 Tools 22 25 Others (incl. Schuler AG) 22 22 </pre> SUBSEQUENT EVENTS OPENING OF PRODUCTION FACILITY IN DALIAN, CHINA Our new factory in the Chinese port of Dalian was opened on July 18, 2013. The plant ­expansion more than tripled capacity to 16,000 square meters. Around EUR 16 million was invested in the development of the site with the intent to significantly increase the amount of value added in China. Dalian will become an important cornerstone of our production in China. The new plant will enable us to manufacture a large number of our products locally in line with German standards and safety norms. This means we can meet the strong demand from Chinese manufacturers for top-quality machines such as our presses. And, last but not least, the new facility brings us even closer to our customers. Production at the new plant is state-of-the-art. Schuler can produce an extremely wide variety of press models here: from stamping and cutting systems to all kinds of hydraulic machines, and even press and blanking lines. OUTLOOK We continue to uphold our forecast for the fiscal year 2012/13 as a whole. After two ­outstanding fiscal years with new orders of EUR 1.3 billion in each, orders have reached a more normal level. The number of project inquiries, especially from the automotive sector and its suppliers, has been falling since the beginning of 2013. We already took this development into consideration when publishing our guidance in December 2012. We can, therefore, confirm the guidance for fiscal year 2012/13. The high order backlog of around EUR 1.1 billion as of June 30, 2013, as well as the development of sales and earnings in the first nine months of the current fiscal year make us confident that we can reach our targets. We therefore continue to expect sales of around EUR 1.2 billion in fiscal year 2012/13 with an EBITDA margin of almost 10%. 07.08.2013 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: SCHULER AG BahnhofstraÃ?e 41 73033 Göppingen Germany Internet: www.schulergroup.com End of Announcement DGAP News-Service ---------------------------------------------------------------------------