Quarterly Report • May 8, 2013
Quarterly Report
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Report on the First Quarter of 2013
INNOVATION
EVOLUTION INNOVATION
INNOVATION
| Earnings Data | 1-3/2012 | 1-3/2013 | Chg. in % | Year-end 2012 | |
|---|---|---|---|---|---|
| Revenues | in € mill. | 366.8 | 491.9 | +34 | 2,355.5 |
| Operating EBITDA | in € mill. | 3.9 | 2.1 | -46 | 245.5 |
| Operating EBIT | in € mill. | -42.5 | -48.8 | -15 | 31.0 |
| Profit before tax | in € mill. | -53.8 | -67.8 | -26 | -36.2 |
| Profit after tax 1) | in € mill. | -50.1 | -58.5 | -17 | -40.5 |
| Earnings per share | in € | -0.50 | -0.57 | -14 | -0.61 |
| Free cash flow 2) | in € mill. | -132.4 | -242.5 | -83 | 163.6 |
| Normal capex | in € mill. | 20.8 | 20.7 | 0 | 105.3 |
| Growth capex | in € mill. | 0.4 | 0.1 | -79 | 163.4 |
| Balance Sheet Data | 31.12.2012 | 31.3.2013 | Chg. in % | |
|---|---|---|---|---|
| Equity 3) | in € mill. | 2,363.7 | 2,272.5 | -4 |
| Net debt | in € mill. | 602.0 | 877.8 | +46 |
| Capital employed | in € mill. | 2,931.3 | 3,126.4 | +7 |
| Balance sheet total | in € mill. | 4,139.7 | 4,079.1 | -1 |
| Gearing | in % | 25.5 | 38.6 | +52 |
| Ø Employees | 13,060 | 13,653 | +5 |
| Stock Exchange Data | 1-12/2012 | 1-3/2013 | Chg. in % | |
|---|---|---|---|---|
| Share price high | in € | 9.49 | 9.69 | +2 |
| Share price low | in € | 5.53 | 7.13 | +29 |
| Share price at end of period | in € | 6.93 | 9.29 | +34 |
| Shares outstanding (weighted) 4) | in 1,000 | 115,063 | 115,063 | 0 |
| Market capitalization at end of period | in € mill. | 814.3 | 1,091.6 | +34 |
| Divisions 1-3/2013 in € mill. and % 5) |
Bricks & Tiles Europe |
Pipes & Pavers Europe |
North America | Holding & Others |
Reconciliation | ||||
|---|---|---|---|---|---|---|---|---|---|
| Third party revenues | 246.8 | (-16%) | 196.8 | (>100%) | 46.8 | (+45%) | 1.5 | (+15%) | |
| Inter-company revenues | 0.3 | (-40%) | 0.3 | (>100%) | 0.0 | (0%) | 2.1 | (0%) | -2.7 |
| Revenues | 247.1 | (-16%) | 197.1 | (>100%) | 46.8 | (+45%) | 3.6 | (+6%) | -2.7 |
| Operating EBITDA | -2.9 (<-100%) | 8.4 | (>100%) | 0.3 | (>100%) | -3.8 | (+16%) | ||
| Operating EBIT | -34.9 | (-54%) | -3.6 | (+37%) | -5.4 | (+29%) | -4.9 | (+26%) | |
| Total investments | 9.9 | (-41%) | 6.1 | (>100%) | 1.1 | (-8%) | 3.7 | (>100%) | |
| Capital employed | 1,946.3 | (-6%) | 684.2 | (>100%) | 479.2 | (+3%) | 16.7 | (+53%) | |
| Ø Employees | 8,292 | (-5%) | 3,966 | (>100%) | 1,194 | (+22%) | 201 | (-5%) |
1) Before non-controlling interest and accrued hybrid coupon
2) Cash flow from operating activities minus cash flow from investing activities plus growth capex
3) Equity including non-controlling interests and hybrid capital
4) Adjusted for treasury stock
5) Changes in % to the comparable prior year period are shown in brackets.
Explanatory notes to the report:
- Operating EBITDA and operating EBIT are adjusted for non-recurring income and expenses.
- Q1 2012 data were adjusted to reflect a change in accounting policies.
- Rounding differences may arise from the automatic processing of data.
Our operations during the first three months of 2013 were significantly influenced by the weather. This year, the long and snowy winter that continued into April across many parts of Europe and the eastern regions of the USA brought construction to a near standstill in many of our markets. The Bricks & Tiles Europe Division was especially hard hit by the sharp drop in construction and recorded substantial volume declines. The Pipes & Pavers Europe Division reported sound revenue and earnings growth following the initial consolidation of Pipelife, which was acquired in May 2012. The North America Division held volumes constant at the prior year level in spite of the unfavorable weather and increased brick business margins with the support of previously implemented cost saving measures. In a market environment made extremely difficult by the weather, the Wienerberger Group generated a 34% increase in revenues to € 491.9 million due to the initial consolidation of Pipelife. Operating EBITDA fell slightly below the prior year level of € 3.9 million to € 2.1 million for the reporting period.
The snowy winter had the strongest effect on the Bricks & Tiles Europe Division, where revenues fell roughly € 48 million and operating EBITDA nearly € 15 million below the first quarter of 2012. Demand weakened on almost all European markets as a result of the weather, while earnings were also negatively affected by extended plant standstills. For the first time in several years, volumes rose from the previously very low levels in Bulgaria and Romania. Russia continued its sound development with an improvement in revenues and earnings for the reporting period. The development of prices in Western Europe was better than Eastern Europe because of the short-term sales campaigns carried out in a number of East European countries.
In the Pipes & Pavers Europe Division, the initial consolidation of Pipelife led to a substantial increase in revenues and earnings. Revenues rose by approx. € 159 million and operating EBITDA by approx. € 10 million. Pipelife recorded a slight weather-related drop in pipe sales, e.g. in the sewage segment, but largely offset this decline with growth in the industrials business. Concrete paver volumes were substantially lower, but due to cost savings margins improved from the prior year level.
The positive trend in new residential construction continued in North America. Brick volumes therefore remained stable for the first three months in spite of the unfavorable weather. Margins were also higher due to the successful implementation of cost reduction measures. Supported by the initial consolidation of Pipelife's North American activities, revenues in this division rose by 45% to € 46.8 million and operating EBITDA improved from € -2.1 million in the first quarter of 2012 to € 0.3 million in the reporting period.
Our goal at the start of this year was to substantially increase revenues and earnings. Whether we can reach this goal is dependent not only on recovering at least part of the ground lost during the first quarter, but also on the development of our markets during the remainder of the year. The visibility over our key markets is currently limited, since construction activity in Europe only normalized in mid-April. I expect a continuation of the difficult market conditions in the
Heimo Scheuch, Chief Executive Officer of Wienerberger AG
Significant weatherrelated revenue and earnings decline in Bricks & Tiles Europe
Revenue and earnings growth in the Pipes & Pavers Europe Division due to initial consolidation of Pipelife
Positive EBITDA in North America for Q1
Goal for 2013: sound improvement in revenues and earnings
Netherlands, France, Poland and the Czech Republic, but more stable development in Germany, Great Britain, Bulgaria and Romania. The Bricks & Tiles Europe Division could, from the current point of view, face further slight volume declines this year, but the previously implemented cost reduction measures should largely offset the resulting negative effect on earnings. The restructuring program announced in the second half of 2012 is being realized as planned and should bring the expected € 18 million of cost savings for the full year. I expect a contribution of approx. € 30 million to Group operating EBITDA from the initial consolidation of Pipelife for the first five months of 2013. In North America, the positive trend in US new residential construction should continue and lead to an increase in the demand for bricks.
€ 300 million bond successfully placed with national and international investors in April
Wienerberger issued a new bond in April 2013. As a result of the strong demand, we increased the volume from the originally planned € 250 to 300 million and were able to set the coupon at 4%. One particularly positive factor was the substantial interest from international investors. More than 75% of the bond was placed outside Austria and nearly half with institutional investors. We plan to use the proceeds to refinance the bond that will mature in April 2014 and to fund the operating business. Our goal remains intact to hold the ratio of net debt to operating EBITDA below 2.5 at year-end. Activities in 2013 will also focus on the generation of strong cash flows, a greater concentration on premium building material solutions and the development of new products. Our priorities for the further development of our business include bolt-on projects in the core areas, where we want to utilize value-creating opportunities for the continued growth of the Wienerberger Group.
The long, snowy winter led to a sharp drop in construction activity throughout Europe and large parts of North America during the first three months of 2013. Revenues recorded by the Wienerberger Group rose by 34% year-on-year to € 491.9 million for the reporting period, with a contribution of € 183.1 million from Pipelife. Organic growth was negative at 16%, primarily due to volume declines in all key product groups as a result of the adverse weather conditions. Average prices were slightly lower than the previous year, whereby there were differences between the various regions and product groups: the prices for clay blocks declined following short-term sales campaigns in Eastern Europe, while the prices for roof tiles and facing bricks remained largely stable. Positive foreign exchange effects from the Norwegian and Swedish krone nearly offset the negative effects from the British pound, US dollar and Swiss Franc.
In the Bricks & Tiles Europe Division, the weather-related drop in demand led to a 16% decline in revenues to € 246.8 million. Operating EBITDA was also negatively affected by the costs of extended winter production standstills and fell by € 15.3 million year-on-year to € -2.9 million.
Revenues in the Pipes & Pavers Europe Division rose from € 38.3 million to € 196.8 million and operating EBITDA from € -1.9 million to € 8.4 million for the reporting period due to the initial consolidation of Pipelife. This company recorded generally stable volumes in Eastern Europe, but slight volume declines in Western Europe. Volumes in the concrete paver business, which is heavily dependent on the weather, were substantially lower in the first quarter, but previously implemented cost reduction measures supported an improvement in margins.
The North America Division reported a 45% increase in revenues to € 46.8 million based on stable brick volumes and the initial consolidation of Pipelife's US activities. Operating EBITDA rose slightly in year-on-year comparison by € 2.4 million.
Operating EBITDA in the Wienerberger Group amounted to € 2.1 million for the reporting period, which is slightly lower than the first quarter of 2012 (€ 3.9 million). The initial inclusion of Pipelife, which contributed € 12.8 million to EBITDA, and better results in North America largely offset the EBITDA decline in the Bricks & Tiles Europe Division. Operating EBIT fell by 15% yearon-year to € 48.8 million.
The substantial year-on-year decline in financial results to € -19.0 million (Q1 2012: € -11.3 million) is explained by the change in the consolidation range – income from investments in associates and joint ventures for the comparable prior year period included Pipelife results at 50% – and also by weather-related volume declines and the resulting lower income recorded by the Tondach Group (reported at equity under financial results). Profit before tax fell to € -67.8 million for the first three months of 2013 (2012: € -53.8 million), also as the result of an increase in interest costs following the Pipelife acquisition in 2012. After the deduction of taxes, the Wienerberger Group recorded a loss of € 58.5 million for the reporting period (2012: loss of € 50.1 million). Earnings per share equaled € -0.57, compared with € -0.50 in the first three months of 2012. The calculation of earnings per share includes an adjustment for the accrued hybrid coupon.
Seasonal factors lead to negative cash flow
Higher net debt due to seasonal increase in working capital
Cash flow from operating activities was negative at € 223.7 million due to the weather-related revenue decline and the seasonal increase in working capital. Expenditures for normal capex (maintenance and investments in technical upgrades for production processes) totaled € 20.7 million.
Group equity declined during the reporting period, above all due to the € 58.5 million aftertax loss and the € 32.5 million hybrid coupon payment in February 2013. Negative foreign exchange differences from the British pound and the Polish zloty were almost entirely offset by positive differences from the US dollar. Net debt rose by € 275.8 million over the level at December 31, 2012 to € 877.8 million as of March 31, 2013 due to the seasonal increase in working capital.
In April 2013 Wienerberger issued a seven-year bond with a volume of € 300 million and a fixed coupon of 4.00%. The issue, which was oversubscribed several times, was placed with international banks and institutional funds. Wienerberger intends to use the proceeds to refinance the bond that will mature in April 2014, to fund the operating business and to strengthen the Group's liquidity. The protection of the strong capital structure and financial discipline remain the top priorities. Accordingly, the Managing Board's goal to hold the ratio of net debt to operating EBITDA below 2.5 at year-end remains intact.
The weather played a significant role in the development of business for the Bricks & Tiles Europe Division during the first quarter of 2013. The long, snowy winter continued well into April in nearly all European countries and brought construction to a near standstill in Wienerberger's markets. The result was a significant year-on-year decline in the demand for bricks throughout Europe and a double-digit volume decline for this division. Cost savings from the restructuring program were unable to offset the resulting decline in earnings. Extended plant standstills had an additional negative effect on earnings. Wienerberger's core markets in Western Europe were especially hard hit, and the revenue and earnings declines in this region were therefore much higher than in Eastern Europe. Average prices in the Bricks & Tiles Europe Division were slightly lower than the previous year, whereby there were differences between the various regional and product groups. The prices in Western Europe increased slightly across all product groups, in spite of the difficult environment, but average prices in Eastern Europe were lower than 2012 due to short-term sales campaigns in selected regions. Revenues in the Bricks & Tiles Europe Division fell by 16% to € 246.8 million for the first quarter of 2013 and operating EBITDA declined to € -2.9 million (2012: € 12.4 million).
The announced restructuring program is currently being realized as planned, with a primary focus on the bundling of production, administrative and sales activities. Cost structures will be further optimized by the creation of additional plant clusters and the shift of products to other locations. The measures implemented during the first three months were concentrated on the clay block, facing brick and paver businesses in the Netherlands, Belgium and France.
| Bricks & Tiles Europe | 1-3/2012 | 1-3/2013 | Chg. in % | |
|---|---|---|---|---|
| Third party revenues | in € mill. | 294.5 | 246.8 | -16 |
| Operating EBITDA | in € mill. | 12.4 | -2.9 | <-100 |
| Operating EBIT | in € mill. | -22.6 | -34.9 | -54 |
| Total investments | in € mill. | 16.8 | 9.9 | -41 |
| Capital employed | in € mill. | 2,076.2 | 1,946.3 | -6 |
| Ø Employees | 8,761 | 8,292 | -5 |
As a result of the unfavorable weather, construction activity in Europe only normalized in mid-April. Forecasts for future market developments are therefore limited at the present time. We are forecasting a moderate volume decline in the Bricks & Tiles Europe Division for the full year. The markets in the Netherlands, France, Poland and the Czech Republic should remain difficult, but Germany and Great Britain should produce a more stable development. In Russia, we see a slight positive trend in new residential construction through year-end. The Bricks & Tiles Europe Division is expected to record a volume-based earnings decline in 2013 which should, for the most part, be offset by cost savings.
The snowy winter had the strongest effect on the Bricks & Tiles Western Europe Segment, which reported revenue and earnings declines in all core markets. In addition to the expected weakness in France and the Netherlands, volumes were also lower than the previous year in Germany, Belgium, Italy, Switzerland and Great Britain. Segment revenues fell by 19% to € 195.6 million for the first quarter of 2013. Extended plant standstills and a weather-related increase in energy consumption led Business development influenced by the weather
Very limited visibility on further market development
Revenues fall by 19% due to long winter in key markets
to higher unit costs. Cost reduction measures, which were implemented with priority in this segment, were unable to offset the volume-based earnings decline and higher costs. Segment EBITDA fell from € 13.1 million in the first quarter of 2012 to € 0.3 million for the reporting period.
| Bricks & Tiles Western Europe | 1-3/2012 | 1-3/2013 | Chg. in % | |
|---|---|---|---|---|
| Third party revenues | in € mill. | 242.8 | 195.6 | -19 |
| Operating EBITDA | in € mill. | 13.1 | 0.3 | -98 |
| Operating EBIT | in € mill. | -10.1 | -22.1 | <-100 |
| Total investments | in € mill. | 12.5 | 8.1 | -35 |
| Capital employed | in € mill. | 1,548.3 | 1,474.2 | -5 |
| Ø Employees | 6,232 | 5,940 | -5 |
We are currently unable to issue a reliable forecast for the development of business in our most important end markets during the remainder of this year. France, the Netherlands and Italy have already shown signs of weakness in the demand for building materials, but the extent of the decline cannot be predicted at the present time. The focus in these countries will therefore remain on the implementation of restructuring measures to adjust cost structures to the market and increase earnings. Further slight weakness appears possible in Belgium, but Germany and Great Britain should record stable to moderately positive development.
Business development in the Bricks & Tiles Eastern Europe Segment differed by country. In Poland, Austria and the Czech Republic, the largest markets in this segment, revenues showed a double-digit decline. In contrast, volumes were higher in Russia, Romania and Bulgaria. Russia continued the positive trend that began two years ago, while Romania and Bulgaria appear to be stabilizing at a low level as we predicted at the beginning of this year. Revenues in the Bricks & Tiles Eastern Europe Segment nearly matched the prior year at € 51.2 million for the first quarter of 2013, but operating EBITDA fell from € -0.7 million in 2012 to € -3.2 million due to costs of idle capacity and lower average prices that resulted from short-term sales campaigns in selected markets.
| Bricks & Tiles Eastern Europe | 1-3/2012 | 1-3/2013 | Chg. in % | |
|---|---|---|---|---|
| Third party revenues | in € mill. | 51.7 | 51.2 | -1 |
| Operating EBITDA | in € mill. | -0.7 | -3.2 | <-100 |
| Operating EBIT | in € mill. | -12.5 | -12.8 | -2 |
| Total investments | in € mill. | 4.3 | 1.8 | -58 |
| Capital employed | in € mill. | 527.9 | 472.1 | -11 |
| Ø Employees | 2,529 | 2,352 | -7 |
Forecasts for our Austrian home market point to stable development for the full 2013 financial year, in spite of the weak first quarter. In contrast, Poland and the Czech Republic should report lower revenues and earnings because of the general economic weakness and the decline in consumer confidence. We hope the markets in Romania and Bulgaria will bottom out as expected during the course of the year and construction activity will then stabilize at a low level. Russia should continue to generate moderate growth in new residential construction as well as steady positive demand for building materials.
Lower volumes on core markets; expected stabilization confirmed in Romania and Bulgaria
Poland and Czech Republic most challenging markets in 2013
The Pipes & Pavers Europe Division reported an increase in revenues from € 38.3 million in the first three months of 2012 to € 196.8 million for the first quarter of 2013. EBITDA improved from € -1.9 million to € 8.4 million during the same period. This sound growth is explained, above all, by the initial consolidation of Pipelife, one of the leading plastic pipe producers in Europe, which was acquired at the end of May 2012. The development of the pipe business during the first quarter of this year was also negatively influenced by the long winter, but to a much lesser extent than the brick segment. Pipelife almost repeated the excellent first quarter results from 2012, since the weather-related declines in the water supply and waste water areas were largely offset by growth in the industrial pipe business (large-sized and fiberreinforced pipes). The weather also had a negative effect on the concrete paver business, which recorded substantially lower volumes for the first three months. However, cost reduction measures implemented in earlier periods led to a significant improvement in margins during the first quarter of 2013.
| Pipes & Pavers Europe | 1-3/2012 | 1-3/2013 | Chg. in % | |
|---|---|---|---|---|
| Third party revenues | in € mill. | 38.3 | 196.8 | >100 |
| Operating EBITDA | in € mill. | -1.9 | 8.4 | >100 |
| Operating EBIT | in € mill. | -5.7 | -3.6 | +37 |
| Total investments | in € mill. | 2.6 | 6.1 | >100 |
| Capital employed | in € mill. | 215.3 | 684.2 | >100 |
| Ø Employees | 1,544 | 3,966 | >100 |
Sound revenue and earnings growth for Pipes & Pavers Europe due to initial consolidation of plastic pipe business
Our forecasts call for a sound improvement in revenues and EBITDA for the Pipes & Pavers Europe Division in 2013. The plastic pipe business is well positioned to generate the expected EBITDA contribution of approx. € 30 million for the first five months. We are optimistic that earnings for the full 2013 financial year will reach the 2012 level because of the increasing contributions from the industrials business. In the concrete paver area, the first quarter improvement in margins underlines our goal to improve profitability for the entire year.
Revenues in the Pipes & Pavers Western Europe Segment rose from € 24.5 million in the first quarter of 2012 to € 132.8 million for the reporting period due to the initial consolidation of the plastic pipe business. Operating EBITDA grew from € 1.5 million to € 11.6 million during this same period. Revenues and earnings from plastic pipe systems and ceramic pipe systems were lower than the previous year because of the cold weather. However, this weather-related decline was offset in part by major orders for industrial plastic pipes that were received in 2012 (large-sized and fiber-reinforced pipes).
Solid increase in revenues and earnings expected for 2013
Initial inclusion of Pipelife leads to sound earnings improvement
| Pipes & Pavers Western Europe | 1-3/2012 | 1-3/2013 | Chg. in % | |
|---|---|---|---|---|
| Third party revenues | in € mill. | 24.5 | 132.8 | >100 |
| Operating EBITDA | in € mill. | 1.5 | 11.6 | >100 |
| Operating EBIT | in € mill. | 0.8 | 5.1 | >100 |
| Total investments | in € mill. | 0.2 | 3.6 | >100 |
| Capital employed | in € mill. | 64.6 | 372.1 | >100 |
| Ø Employees | 530 | 1,792 | >100 |
In the Pipes & Pavers Eastern Europe Segment, the initial consolidation of the plastic pipe business supported an increase in revenues from € 13.8 million in the first quarter of 2012 to € 64.0 million for the reporting period and a 6% improvement in operating EBITDA to € -3.2 million. The pipe systems and concrete paver businesses were faced with a severe winter and difficult markets, above all in Poland and the Czech Republic. Despite substantial weatherrelated declines in concrete paver revenues, operating EBITDA remained nearly constant due to cost savings from the restructuring program and subsequently led to an improvement in margins.
| Pipes & Pavers Eastern Europe | 1-3/2012 | 1-3/2013 | Chg. in % | |
|---|---|---|---|---|
| Third party revenues | in € mill. | 13.8 | 64.0 | >100 |
| Operating EBITDA | in € mill. | -3.4 | -3.2 | +6 |
| Operating EBIT | in € mill. | -6.5 | -8.7 | -34 |
| Total investments | in € mill. | 2.4 | 2.5 | +4 |
| Capital employed | in € mill. | 150.7 | 312.1 | >100 |
| Ø Employees | 1,014 | 2,174 | >100 |
We expect a continuation of the difficult market environment in Poland and the Czech Republic, but a normalization of demand in the other countries of this segment during the remainder of this year.
Business in the North America Division was also negatively affected by the severe weather at the beginning of the year, but to a lesser extent than in Europe. Brick volumes for the first three months roughly matched the prior year level. Division revenues rose by 45% to € 46.8 million, above all due to the initial consolidation of the North American plastic pipe business. Operating EBITDA improved to € 0.3 million, following a loss of € 2.1 million in the previous year, which represents the first positive Q1 since 2008. This development was also supported by cost reduction measures and strict cost management that led to an improvement in brick margins.
Initial consolidation offsets difficult markets and weather effects
Positive Q1 EBITDA in North America for the first time since 2008
| North America | 1-3/2012 | 1-3/2013 | Chg. in % | |
|---|---|---|---|---|
| Third party revenues | in € mill. | 32.3 | 46.8 | +45 |
| Operating EBITDA | in € mill. | -2.1 | 0.3 | >100 |
| Operating EBIT | in € mill. | -7.6 | -5.4 | +29 |
| Total investments | in € mill. | 1.2 | 1.1 | -8 |
| Capital employed | in € mill. | 465.3 | 479.2 | +3 |
| Ø Employees | 982 | 1,194 | +22 |
We expect a continuation of the moderate positive trend in US new residential construction during 2013 as well as an increase in the demand for bricks. Our strategic focus for the plastic pipe business lies in the further development of the market for fiber-reinforced pipes and active support for the substitution process to plastic pipes. In total, we expect an increase in revenues and earnings for the North America Division in 2013.
Higher revenues and earnings expected for 2013
The Holding & Others Division recorded a 15% increase in revenues to € 1.5 million due to the continuing strong development of our activities in India. The resulting improvement in operating results and strict cost management at the corporate headquarters led to a 16% reduction in the EBITDA loss to € -3.8 million.
| Holding & Others | 1-3/2012 | 1-3/2013 | Chg. in % | |
|---|---|---|---|---|
| Third party revenues | in € mill. | 1.3 | 1.5 | +15 |
| Operating EBITDA | in € mill. | -4.5 | -3.8 | +16 |
| Operating EBIT | in € mill. | -6.6 | -4.9 | +26 |
| Total investments | in € mill. | 0.6 | 3.7 | >100 |
| Capital employed | in € mill. | 10.9 | 16.7 | +53 |
| Ø Employees | 212 | 201 | -5 |
Sound revenue and earnings growth in India; strict cost management at Group headquarters
| in TEUR | 1-3/2013 | 1-3/2012 1) |
|---|---|---|
| Revenues | 491,949 | 366,830 |
| Cost of goods sold | -379,919 | -272,432 |
| Gross profit | 112,030 | 94,398 |
| Selling expenses | -115,604 | -96,651 |
| Administrative expenses | -39,879 | -31,575 |
| Other operating expenses | -14,695 | -15,276 |
| Other operating income | 9,341 | 6,605 |
| Profit/loss | -48,807 | -42,499 |
| Income from investments in associates and joint ventures | -7,067 | -2,895 |
| Interest and similar income | 1,820 | 4,075 |
| Interest and similar expenses | -13,501 | -13,838 |
| Other financial results | -273 | 1,370 |
| Financial results | -19,021 | -11,288 |
| Profit/loss before tax | -67,828 | -53,787 |
| Income taxes | 9,341 | 3,731 |
| Profit/loss after tax | -58,487 | -50,056 |
| Thereof attributable to non-controlling interests | -570 | -672 |
| Thereof attributable to hybrid capital holders | 8,014 | 8,081 |
| Thereof attributable to equity holders | -65,931 | -57,465 |
| Earnings per share (in EUR) | -0.57 | -0.50 |
| Diluted earnings per share (in EUR) | -0.57 | -0.50 |
| in TEUR | 1-3/2013 | 1-3/2012 1) |
|---|---|---|
| Profit/loss after tax | -58,487 | -50,056 |
| Foreign exchange adjustments | -2,715 | 15,270 |
| Foreign exchange adjustments to investments in associates and joint ventures | -524 | 1,937 |
| Changes in the fair value of available-for-sale financial instruments | 235 | 1,501 |
| Changes in hedging reserves | 2,775 | -1,930 |
| Other comprehensive income 2) | -229 | 16,778 |
| Total comprehensive income | -58,716 | -33,278 |
| Thereof comprehensive income attributable to non-controlling interests | -575 | -659 |
| Thereof attributable to hybrid capital holders | 8,014 | 8,081 |
| Thereof comprehensive income attributable to equity holders | -66,155 | -40,700 |
1) The prior year data were adjusted to reflect the premature application of IAS 19 Employee Benefits and the change to the equity method for companies previously included through proportionate consolidation.
2) The components of other comprehensive income are reported net of tax.
| in TEUR | 31.3.2013 | 31.12.2012 1) |
|---|---|---|
| Assets | ||
| Intangible assets and goodwill | 879,616 | 882,060 |
| Property, plant and equipment | 1,774,108 | 1,803,067 |
| Investment property | 79,965 | 81,297 |
| Investments in associates and joint ventures | 22,377 | 33,039 |
| Other financial assets | 1,440 | 1,329 |
| Deferred tax assets | 42,888 | 39,490 |
| Non-current assets | 2,800,394 | 2,840,282 |
| Inventories | 766,324 | 700,925 |
| Trade receivables | 270,382 | 199,166 |
| Other current receivables | 97,426 | 84,566 |
| Securities and other financial assets | 77,837 | 72,504 |
| Cash and cash equivalents | 66,703 | 242,288 |
| Current assets | 1,278,672 | 1,299,449 |
| Total Assets | 4,079,066 | 4,139,731 |
| Equity and Liabilities | ||
| Issued capital | 117,527 | 117,527 |
| Share premium | 1,083,973 | 1,083,973 |
| Hybrid capital | 492,896 | 492,896 |
| Retained earnings | 765,581 | 855,998 |
| Other reserves | -166,006 | -165,782 |
| Treasury stock | -24,324 | -24,324 |
| Controlling interests | 2,269,647 | 2,360,288 |
| Non-controlling interests | 2,821 | 3,396 |
| Equity | 2,272,468 | 2,363,684 |
| Deferred taxes | 99,481 | 105,822 |
| Employee-related provisions | 133,096 | 132,277 |
| Other non-current provisions | 52,487 | 53,001 |
| Long-term financial liabilities | 926,301 | 858,708 |
| Other non-current liabilities | 9,657 | 9,896 |
| Non-current provisions and liabilities | 1,221,022 | 1,159,704 |
| Other current provisions | 65,299 | 80,618 |
| Short-term financial liabilities | 96,011 | 58,062 |
| Trade payables | 228,290 | 253,149 |
| Other current liabilities | 195,976 | 224,514 |
| Current provisions and liabilities | 585,576 | 616,343 |
| Total Equity and Liabilities | 4,079,066 | 4,139,731 |
| 2013 | 2012 1) | |||||
|---|---|---|---|---|---|---|
| in TEUR | Group | Non-controlling interests |
Total | Group | Non-controlling interests |
Total |
| Balance on 1.1. | 2,360,288 | 3,396 | 2,363,684 | 2,427,560 | 3,259 | 2,430,819 |
| Total comprehensive income | -58,141 | -575 | -58,716 | -32,619 | -659 | -33,278 |
| Dividend payments/hybrid coupon | -32,500 | 0 | -32,500 | -32,500 | 0 | -32,500 |
| Balance on 31.3. | 2,269,647 | 2,821 | 2,272,468 | 2,362,441 | 2,600 | 2,365,041 |
1) The prior year data were adjusted to reflect the premature application of IAS 19 Employee Benefits and the change to the equity method for companies previously included through proportionate consolidation.
| in TEUR | 1-3/2013 | 1-3/2012 1) |
|---|---|---|
| Profit/loss before tax | -67,828 | -53,787 |
| Depreciation and amortization | 50,906 | 46,416 |
| Increase/decrease in long-term provisions and deferred taxes | -10,804 | -2,050 |
| Income from investments in associates and joint ventures | 7,067 | 2,895 |
| Gain/loss from the disposal of fixed and financial assets | -3,160 | -692 |
| Interest results | 11,681 | 9,763 |
| Interest paid | -3,615 | -2,615 |
| Interest received | 334 | 2,658 |
| Income taxes paid | -2,555 | -817 |
| Gross cash flow | -17,974 | 1,771 |
| Increase/decrease in inventories | -65,399 | -17,969 |
| Increase/decrease in trade receivables | -71,216 | -58,574 |
| Increase/decrease in trade payables | -24,859 | -32,755 |
| Increase/decrease in other net current assets | -45,060 | -8,099 |
| Changes in non-cash items resulting from foreign exchange translation | 811 | 2,549 |
| Cash flow from operating activities | -223,697 | -113,077 |
| Proceeds from the sale of assets (including financial assets) | 5,827 | 928 |
| Purchase of property, plant and equipment and intangible assets | -20,755 | -21,186 |
| Payments made for investments in financial assets | -102 | 0 |
| Increase/decrease in securities and other financial assets | -3,862 | 595 |
| Net payments made for the acquisition of companies | 26 | 0 |
| Cash flow from investing activities | -18,866 | -19,663 |
| Increase/decrease in long-term financial liabilities | 67,593 | 237,108 |
| Increase/decrease in short-term financial liabilities | 30,925 | -1,344 |
| Hybrid coupon paid | -32,500 | -32,500 |
| Dividend payments from associates and joint ventures | 1,425 | 3,041 |
| Cash flow from financing activities | 67,443 | 206,305 |
| Change in cash and cash equivalents | -175,120 | 73,565 |
| Effects of exchange rate fluctuations on cash held | -465 | 252 |
| Cash and cash equivalents at the beginning of the period | 242,288 | 490,373 |
| Cash and cash equivalents at the end of the period | 66,703 | 564,190 |
1) The prior year data were adjusted to reflect the premature application of IAS 19 Employee Benefits and the change to the equity method for companies previously included through proportionate consolidation.
| Bricks & Tiles Europe |
Pipes & Pavers Europe |
|||||||
|---|---|---|---|---|---|---|---|---|
| 1-3/2013 | Bricks & Tiles Western Europe |
Bricks & Tiles Eastern Europe |
Pipes & Pavers Western Europe |
Pipes & Pavers Eastern Europe |
North America |
Holding & Others 2) |
Recon ciliation 3) |
Wienerberger Group |
| Third party revenues | 195,564 | 51,172 | 132,783 | 63,978 | 46,798 | 1,531 | 491,826 | |
| Inter-company revenues | 913 | 1,109 | 4,689 | 2,766 | 0 | 2,096 | -11,450 | 123 |
| Total revenues | 196,477 | 52,281 | 137,472 | 66,744 | 46,798 | 3,627 | -11,450 | 491,949 |
| Operating EBITDA 1) | 313 | -3,233 | 11,634 | -3,175 | 346 | -3,786 | 2,099 | |
| Operating EBIT 1) | -22,198 | -12,831 | 5,096 | -8,652 | -5,372 | -4,850 | -48,807 | |
| Total investments | 8,082 | 1,826 | 3,549 | 2,527 | 1,124 | 3,723 | 20,831 | |
| Capital employed | 1,474,196 | 472,110 | 372,076 | 312,105 | 479,217 | 16,719 | 3,126,423 | |
| Ø Employees | 5,940 | 2,352 | 1,792 | 2,174 | 1,194 | 201 | 13,653 | |
| 1-3/2012 4) | ||||||||
| Third party revenues | 242,840 | 51,681 | 24,519 | 13,798 | 32,313 | 1,253 | 366,404 | |
| Inter-company revenues | 1,246 | 822 | 0 | 0 | 0 | 2,058 | -3,700 | 426 |
| Total revenues | 244,086 | 52,503 | 24,519 | 13,798 | 32,313 | 3,311 | -3,700 | 366,830 |
| Operating EBITDA 1) | 13,127 | -711 | 1,506 | -3,439 | -2,115 | -4,451 | 3,917 | |
| Operating EBIT 1) | -10,093 | -12,530 | 792 | -6,506 | -7,619 | -6,543 | -42,499 | |
| Total investments | 12,461 | 4,321 | 215 | 2,433 | 1,191 | 565 | 21,186 | |
| Capital employed | 1,548,302 | 527,919 | 64,581 | 150,676 | 465,256 | 10,938 | 2,767,672 | |
| Ø Employees | 6,232 | 2,529 | 530 | 1,014 | 982 | 212 | 11,499 |
1) Adjusted for restructuring costs and impairment charges to goodwill and property, plant and equipment
2) The Holding & Others segment includes the costs for the corporate headquarters and business activities in India.
3) The 'reconciliation' column includes eliminations between Group companies.
4) The prior year data were adjusted to reflect the premature application of IAS 19 Employee Benefits and the change to the equity method for companies previously included through proportionate consolidation.
The interim report as of March 31, 2013 was prepared in accordance with the principles set forth in International Financial Reporting Standards, Guidelines for Interim Reporting (IAS 34). The accounting and valuation methods in effect on December 31, 2012 remain unchanged. For additional information on the accounting and valuation principles, see the financial statements as of December 31, 2012, which form the basis for these interim financial statements.
The full takeover of Pipelife, which was finalized at the end of May 2012, led to a change in the definition of operating segments for reporting purposes to reflect the new assignment of management responsibilities. The business activities of the Wienerberger Group are still managed on a regional basis, whereby the new segmentation also reflects the different building material solutions. The Bricks & Tiles Europe Division covers activities in the areas of clay blocks, facing bricks and roof tiles in two segments: Bricks & Tiles Western Europe and Bricks & Tiles Eastern Europe. The Pipes & Pavers Europe Division contains the activities of the plastic pipe producer Pipelife, the ceramic pipe producer Steinzeug-Keramo and the concrete paver producer Semmelrock, and includes the Pipes & Pavers Western Europe and Pipes & Pavers Eastern Europe Segments. Activities in North America are reported together under the North America Segment. The Holding & Others Segment consists primarily of Wienerberger's brick business in India and activities at the corporate headquarters.
The consolidated financial statements include all major Austrian and foreign companies in which Wienerberger AG has management control or directly or indirectly owns the majority of shares. The joint ventures in the Tondach Group and the Schlagmann Group are reported at equity (50%).
Changes in the consolidation range increased revenues by TEUR 183,124 and operating EBITDA by TEUR 12,785 for the period from January 1, 2013 to March 31, 2013.
The sales volumes recorded by Wienerberger during the first and last months are lower than at mid-year due to the negative impact of the weather on construction activity. These seasonal fluctuations are demonstrated by data from the first or fourth quarters of the year, which generally lie below results for the second and third quarter.
The TEUR 500,000 hybrid capital is reported as a component of equity, while the coupon payment is shown as part of the use of earnings on the changes in equity statement. The issue costs and the discount were deducted from retained earnings. Wienerberger AG paid a coupon of TEUR 32,500 on February 11, 2013. The proportionate share of the accrued coupon interest for the first three months of 2013 equaled TEUR 8,014; this amount was reflected in the calculation of earnings per share and led to a reduction of EUR 0.07 in this ratio.
Group revenues rose by 34% over the comparable prior year period to TEUR 491,949 for the first three months of 2013 (2012: TEUR 366,830). Operating EBITDA amounted to TEUR 2,099, which is TEUR 1,818 lower than the comparable prior year value of TEUR 3,917. Operating profit equaled TEUR -48,807 for the reporting period, compared with TEUR -42,499 in 2012.
Wienerberger held 2,464,138 treasury shares as of March 31, 2013, which were deducted for the calculation of earnings per share. The weighted number of shares outstanding from January 1, 2013 to March 31, 2013 was 115,062,626. The number of issued shares remained unchanged at 117,526,764 as of March 31, 2013.
Negative foreign exchange differences of TEUR 3,239 (2012: positive differences of TEUR 17,207) which are reported under other comprehensive income, resulted above all from the Polish zloty and the British pound. These adjustments were offset almost entirely by positive differences from the US dollar. The share of currency translation differences attributable to non-controlling interests amounted to TEUR -5 (2012: TEUR 13). The hedging reserve increased equity by TEUR 2,775 after tax during the reporting period (2012: TEUR -1,930). This increase resulted from the fair value measurement of net investment hedges. Positive changes in the fair value of available-for-sale securities totaled TEUR 235 (2012: TEUR 1,501). The after-tax loss recorded for the first quarter of 2013 reduced equity by TEUR -58,487 (2012: TEUR -50,056), and total comprehensive income after tax decreased equity by TEUR -58,716 (2012: TEUR -33,278).
Gross cash flow totaled TEUR -17,974 (2012: TEUR 1,771) and was lower than the prior year due to the weather-related decline in revenues. Cash flows of TEUR 20,831 (2012: TEUR 21,186) for investments in non-current assets (incl. financial assets) and acquisitions included TEUR 20,755 (2012: TEUR 20,818) of normal capex, maintenance and investments in technical upgrades as well as TEUR 76 (2012: TEUR 368) for plant expansion and environmental investments (growth capex).
Normal and growth capex for the first three months of 2013 increased non-current assets by TEUR 20,755 (2012: TEUR 21,186). Net debt rose by TEUR 275,794 over the level at December 31, 2012 to TEUR 877,772 as of March 31, 2013, primarily due to the seasonal increase in working capital.
Wienerberger focuses on the early identification and active management of risks in its operating environment within the context of the principles defined by the Managing Board. The major risks identified by the Group during the first three months of 2013 were higher input costs as well as reserved recovery of the construction industry in individual markets and the resulting pressure on prices. Wienerberger regularly monitors the risks in its operating environment as part of its corporate risk management program and takes appropriate actions to counter these risks whenever necessary. The development of the construction industry and major indicators of the demand for building materials are watched closely to permit the timely adjustment of capacity in the plant network to reflect changing market conditions. The price levels on local markets are also monitored regularly, and pricing strategies are adjusted if necessary. Wienerberger counters the risk of rising input costs by establishing fixed procurement prices at an early point in time and by concluding long-term supply contracts. The risks associated with higher energy costs are reduced through the Group's hedging strategy. The risks expected by Wienerberger during the remaining nine months of this year are linked to higher input costs, uncertainty over further developments in the construction industry and continued pressure on prices in individual markets
Wienerberger is exposed to legal risks in connection with increasingly strict environmental, health and safety regulations, whereby the Group could become liable for penalties or claims to compensation for damages in the event of non-compliance. A provision of MEUR 10 was recognized as of December 31, 2008 for an impending antitrust penalty in Germany. In June 2012 the EU Commission ordered searches at the offices of plastic pipe and fitting producers in connection with alleged agreements in violation of cartel law that also included Pipelife International GmbH. The responsible authorities have not issued any findings to date. It should be noted that price-fixing agreements are not part of business policies in the Wienerberger Group; internal guidelines expressly prohibit such activities and call for sanctions in the event of violations.
The following companies and persons are considered to be related parties: the members of the Supervisory and Managing Boards, associated companies, joint ventures and non-consolidated subsidiaries of Wienerberger AG as well as the ANC private foundation and its subsidiaries.
Wienerberger AG and its subsidiaries finance associated companies, joint ventures and non-consolidated subsidiaries through loans granted at ordinary market conditions. The outstanding receivables due from associated companies and joint ventures amounted to TEUR 18,444 as of March 31, 2013 (2012: TEUR 15,530), while the comparable amount for nonconsolidated subsidiaries was TEUR 6,742 (2012: TEUR 6,707). Transactions between companies included in the consolidated financial statements and companies controlled by a member of the Supervisory Board of Wienerberger AG are related primarily to clay deliveries of TEUR 28 (2012: TEUR 7), rentals of TEUR 997 (2012: TEUR 1,048) and license payments of TEUR 2,934 (2012: TEUR 2,846) for the use of brand names.
On April 11, 2013 Wienerberger announced the issue of a new bond with a volume of TEUR 300,000 and a seven-year term (due on April 17, 2020). The bond has a denomination of EUR 1,000 and a fixed coupon of 4%. The proceeds will be used primarily to refinance existing liabilities, to fund the operating business and to strengthen the liquidity position.
This interim report by Wienerberger AG was neither audited nor reviewed by a certified public accountant.
We confirm to the best of our knowledge that these interim financial statements (interim financial report under IFRS) give a true and fair view of the assets, liabilities, financial position and profit or loss of the Group as required by the applicable accounting standards and that the Group management report gives a true and fair view of the important events that occurred during the first three months of the financial year and their impact on the interim financial statements, of the principal risks and uncertainties for the remaining nine months of the financial year and of the major related party transactions to be disclosed.
The Managing Board of Wienerberger AG Vienna, May 8, 2013
Heimo Scheuch Willy Van Riet Chief Executive Officer Chief Financial Officer
Wienerberger is the only multinational producer of bricks, roof tiles, concrete pavers and pipe systems with a total of 221 plants in 30 countries and four export markets, including one plant in India. We are the world's largest producer of bricks and number one on the clay roof tile market in Europe. Furthermore we hold leading positions in concrete pavers in Central-East Europe and pipe systems in Europe.
| January 29, 2013 | Start of the quiet period |
|---|---|
| February 26, 2013 | Results for 2012 |
| Press and Analysts Conference in Vienna | |
| February 27, 2013 | Analysts Conference in London |
| March 29, 2013 | Publication of the 2012 Annual Report on the Wienerberger website |
| April 22, 2013 | Start of the quiet period |
| May 8, 2013 | First Quarter Results for 2013 |
| May 14, 2013 | 144th Annual General Meeting in the Austria Center Vienna |
| May 16, 2013 | Deduction of dividends for 2012 (ex-day) |
| May 21, 2013 | First day of payment for 2012 dividends |
| July 11, 2013 | Trading Update H1 2013 |
| July 23, 2013 | Start of the quiet period |
| August 20, 2013 | Results for the First Six Months of 2013 |
| Press and Analysts Conference in Vienna | |
| August 21, 2013 | Analysts Conference in London |
| September 4-6, 2013 | Capital Markets Day 2013 in the USA |
| October 22, 2013 | Start of the quiet period |
| November 13, 2013 | Third Quarter Results for 2013 |
| Barbara Braunöck |
|---|
| +43 1 601 92 10221 |
| [email protected] |
| www.wienerberger.com |
| WIE |
| WBSV.VI; WIE-VI |
| WIE AV |
| O: WNBA |
| WBRBY |
| AT0000831706 |
The report on the First Quarter 2013 is available in German and English.
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