EANS-News: Semperit AG Holding / Operating results improved again inthe first nine months of 2018
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Quarterly Report
Vienna, Austria –
Total revenue of EUR 670.3 million at the previous year’s levelnIndustrial Sector gained momentum and increased revenue by 5.6% to EUR 432.7 million; revenue decreased by 8.7% in the Medical SectornEBITDA adjusted for negative one-off effects increased by 39.1% to EUR 45.8 million; adjusted EBITDA margin rose from 4.9% to 6.8%nEBIT adjusted for one-off effects more than doubled to EUR 17.5 million, while adjusted EBIT margin improved from 1.2% to 2.6%nVienna/Austria, 21 November 2018 – The operating earnings (adjusted EBIT) of the
publicly listed Semperit Group continued to increase with stable sales in the
first nine months of 2018. “We see a clear progress, which manifests itself
particularly in the Industrial Sector,” says Martin Füllenbach, Chairman of the
Management Board of Semperit AG Holding. “More than 600 initiatives, which we
have introduced within the scope of our restructuring and transformation
process, contribute significantly to the improvement of operating results. On
the personnel side, we have also made considerable changes of the course in
recent months and restructured the first and second management levels in the
Sempertrans segment. In this quarter, Sempertrans has achieved the best
quarterly results in two years.”
The business development was characterised by continuous positive global growth
dynamics and primarily favourable economic conditions in the first nine months
of 2018. However, the escalating trade war between the USA and China, rising
inflation and massive currency devaluations in some of the large emerging
economies caused increasing uncertainties in the raw material and financial
markets. Over the last few months, increased competition was observed for some
of the raw materials needed by Semperit.
In the Medical Sector and in the Sempertrans segment, lower revenues were
recorded; at Sempertrans this is among other things due to the closing of plants
in France and China. However, Semperflex and Semperform performed well and
achieved an increase in revenue. At the same time, the current restructuring
measures at the corporate level were continuously enhanced; this caused an
improvement of the operating performance. In contrast, volumes sold decreased in
the Medical Sector and an impairment of EUR 55.2 million had to be recognised
towards the end of the first half of 2018. The half-year report of 2018 already
fully included these figures.
At EUR 670.3 million, total revenue in the first nine months of 2018 was at the
previous year’s level. The Industrial Sector achieved an increase in revenue of
5.6%, which was offset by a revenue decrease by 8.7% in the Medical Sector.
EBITDA, adjusted for the negative one-off effects of EUR 3.9 million from the
shutdown of the Sempertrans site in China, increased from EUR 32.9 million to
EUR 45.8 million, while the adjusted EBITDA margin rose from 4.9% to 6.8%. The
reported EBITDA was EUR 41.9 million in the first three quarters of 2018 after
EUR 97.8 million in the first three quarters of 2017.
Correspondingly, adjusted EBIT also developed very well and increased from EUR
7.9 million in the first nine months of 2017 to EUR 17.5 million in the same
period of 2018, while the adjusted EBIT margin rose from 1.2% to 2.6%. The
reported EBIT was EUR -45.5 million in the first three quarters of 2018 after
EUR 46.1 million (contained one-off effects from the joint venture transaction
in Thailand) in the same period of 2017.
In total, adjusted earnings after tax were EUR -9.9 million in the first three
quarters of 2018 compared with the adjusted value of EUR -13.6 million in the
same period of 2017. Reported earnings from the beginning of the year until the
end of September amounted to EUR -72.9 million after EUR 4.9 million in the same
period last year. Adjusted earnings per share were EUR -0.48 in the first nine
months of 2018 after EUR -0.66 in the first three quarters of 2017 while the
reported earnings per share were EUR -3.68 after EUR 0.24.
At EUR 57.7 million, cash-relevant investments in tangible and intangible assets
in the first nine months of 2018 were higher than the previous year’s level of
EUR 55.8 million. The investment priorities were on expansion and optimisation
in the segments Semperflex (expansion of the hydraulic hose production at the
site in Odry, Czech Republic) and Sempertrans (primarily for the expansion of
mixing in Belchatów, Poland).
With an equity ratio of 39.7% (end of 2017: 32.6%) Semperit continues to have
solid capital resources at the balance sheet date, which were additionally
strengthened by the agreement on a hybrid capital line with the core shareholder
in December 2017. Under accounting law, the Hybrid capital is classified as
equity according to IFRS provisions. In March 2018, EUR 130.0 million were drawn
from the hybrid capital. Cash and cash equivalents were EUR 185.3 million at the
end of September 2018 and were therefore above the level of the end of 2017 (EUR
165.5 million).
INDUSTRIAL SECTOR: SIGNIFICANTLY INCREASING EARNINGS
The Industrial Sector (Semperflex, Sempertrans and Semperform segments) recorded
very differentiated developments. Sales figures of Semperflex increased while
they maintained their level at Semperform and decreased at Sempertrans. Revenue
increased by 5.6% to EUR 432.7 million, with the Semperflex segment accounting
for the largest share of the increase by far, followed by Semperform. Despite a
revenue decrease, which was partly due to the closing of plants in France and
China, Sempertrans achieved the best quarterly results of the last two years.
EBITDA of the Industrial Sector improved by 79.9% to EUR 55.8 million compared
with the previous year while EBIT more than doubled to EUR 35.3 million.
Accordingly, the EBITDA margin increased by 5.3pp to 12.9% while the EBIT margin
rose by 4.2pp to 8.2%.
MEDICAL SECTOR: DECLINING REVENUE AFTER CONSCIOUS STRATEGY CHANGE
In the first nine months of 2018, the development of the Sempermed segment in
the Medical Sector was again characterised by increasing competitive and price
pressures, but also by a decrease in volumes sold due to conscious strategy
changes focussing on in-house products with higher margins. This was reflected
in a revenue development declining by 8.7%. In addition, the earnings
development was influenced by a temporarily limited availability of synthetic
latex as well as inefficiencies in production and difficult market conditions
primarily in North America.
The results include an impairment of EUR 55.2 million (only relevant for EBIT),
which was fully taken into account in the half-year results as of 30 June 2018.
Adjusted EBITDA for the first nine months of 2018 amounted to EUR -0.8 million
compared with EUR 3.3 million in same period of the previous year, which was due
to the adjustment by the positive effects of the joint venture transaction.
Reported EBIT was EUR -66.4 million compared with EUR 44.7 million in the first
nine months of 2017. Since September, Felix Fremerey, who had previously worked
in the medical device sector, has been responsible for the Medical sector.
OUTLOOK 2018
In the further course of the restructuring and transformation process, the
Management Board will decide step by step whether there will be changes in the
portfolio of existing segments as well as further adaptations in the
manufacturing footprint. Continuous and potentially new measures to increase
profitability remain right at the top of the Management Board’s agenda. For
2018, no further significant one-off charges are expected, although they cannot
be excluded for 2019. Therefore, 2018 and also 2019 should continue to be viewed
as transition years. Due to the above-mentioned developments, the outlook
remains suspended for the coming quarters.
Initially, Semperit will focus on organic growth, particularly in the Industrial
Sector. In addition to the ongoing optimisation measures in the Sempermed
segment, Semperit has started further implementation steps for Sempertrans and
Semperform at the beginning of the year. Semperflex is also part of the
transformation process. Here, like in Mixing, the focus is on accelerating
organic growth following completion of the investment projects. Total capital
expenditures (CAPEX) of around EUR 80 million (2017: EUR 74.5 million) have been
planned for 2018, while capital expenditures of EUR 50 to 60 million are
expected for 2019.
Since the beginning of the analysis and transformation process in autumn 2017,
the Management Board has identified significant potentials for earnings
improvement and initiated appropriate implementation measures. The conclusion of
the transformation of the Semperit Group is scheduled for the end of 2020. From
this point of time, the Semperit Group aims to achieve an EBITDA margin of
around 10% as central key performance indicator.
About Semperit
The publicly listed company Semperit AG Holding is an internationally-oriented
group that develops, produces, and sells highly specialised rubber and plastic
products in more than 100 countries for the medical and industrial sectors:
examination and surgical gloves, hydraulic and industrial hoses, conveyor belts,
escalator handrails, construction profiles, cable car rings, and products for
railway superstructures. The headquarters of this traditional Austrian company,
which was founded in 1824, are located in Vienna. The Semperit Group employs
around 6,700 people worldwide, including around 3,500 in Asia and around 900 in
Austria (Vienna and production site in Wimpassing, Lower Austria). The group has
15 manufacturing facilities worldwide and numerous sales offices in Europe,
Asia, Australia, and America. In 2017, the group generated sales of EUR 874.2
million and an adjusted EBITDA (without one-off effects) of EUR 35.8 million.
end of announcement euro adhoc
issuer: Semperit AG Holding
Modecenterstrasse 22
A-1030 Wien
phone: +43 1 79 777-210
FAX: +43 1 79 777-602
mail: stefan.marin@semperitgroup.com
WWW: www.semperitgroup.com
ISIN: AT0000785555
indexes: WBI, ATX PRIME, ATX GP
stockmarkets: Wien
language: English
Digital press kit: http://www.ots.at/pressemappe/2918/aom
Monika Riedel
Director Group Communications & Sustainability
+43 676 8715 8620
monika.riedel@semperitgroup.com
Stefan Marin
Head of Investor Relations
Tel.: +43 676 8715 8210
stefan.marin@semperitgroup.com
www.semperitgroup.com
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