Campine nv

Interim / Quarterly Report • Aug 31, 2012

Interim financial report 30/06/2012

under IFRS

30-08-12

Obligation regarding periodical information as a consequence of the European transparency regulations.

Statement regarding the information given in this interim financial report over the period of 6 months ending on 30 June 2012.

The Board of Directors declares that to their knowledge

• The interim consolidated financial report for the period of 6 months ending on 30 June 2012, gives a true and fair view of the financial position, the financial results and cash flow of Campine nv, including its consolidated subsidiaries (hereinafter: "the Group").
• The interim financial report for the 6 months ending on 30 June 2012 gives a true and fair view of the legal and regulatory required information and corresponds with the condensed interim consolidated financial statements.

Condensed consolidated income statement

'000 EUR	Notes	30/06/2012	30/06/2011
Revenue		85.871	106.515
Other operating income		1.559	495
Changes in inventories of finished goods and work in progress		- 13.701	3.062
Raw materials and consumables used		- 60.944	- 88.676
Employee benefits expense		- 6.505	- 6.273
Depreciation and amortisation expense		- 1.611	- 1.382
Other operating expenses	4	- 4.861	- 5.518
Operating result		- 192	8.223
Investment revenues		-	3
Hedging results	10	745	- 177
Finance costs		- 490	- 546
Result before tax		63	7.503
Income tax expense	5	- 3	- 2.467
Result for the period		60	5.036
Result for the period		60	5.036
Attributable to:
Equity holders of the parent		60	5.036
Minority interest			-
		60	5.036
RESULT PER SHARE (in EUR)		0,04	3,36
Basic		0,04	3,36
Diluted		0,04	3,36

• During the first semester 2012 the Campine Group achieved a revenue of EUR 85.87 million compared with EUR 106.52 million in 2011 (-19 %).
• The operating result decreased to a loss of EUR 0.19 million compared to a profit of EUR 8.22 million in 2011.
• Finance costs were 490 KEUR (546 KEUR in 2011). The lead hedging result amounts to 745 KEUR (- 177 KEUR in 2011).
• Profit after taxes amounted to EUR 0.06 million, compared with a profit of EUR 5.04 million in 2011.

Results per Business Unit:

• Lead: Turnover reached EUR 32.71 million (EUR 34.49 million in 2011) (-5 %). Our volume decreased slightly to 22,538 mT (22,773 mT in 2011) (-1 %). In general, sales prices decreased slightly throughout the first semester of 2012. We note a decrease from 1,533 EUR/mT in the beginning of January, to 1,513 EUR/mT at the end of March and 1,427 EUR/mT at the end of June. Tightness in the supply of raw materials led to pressure on margins.
• Antimony: Turnover reached EUR 41.71 million (EUR 56.03 million in 2011) (-14 %). Sales volume decreased to 4,641 mT (5,874 mT in 2011) (-21 %). Customer demand was lower than a year ago with reduced average prices and margins. However Metal Bulletin prices in the first half of 2012 were 9,538 EUR/mT in the beginning of January, 9,659 EUR/mT at the end of March, further increasing in Q2 to 10,842 EUR/mT at the end of June 2012.
• Plastics: Turnover reached EUR 11.54 million (EUR 14.90 million in 2011) (-23 %). The volume decreased to 2,603 mT (3,010 mT in 2011) (-14 %). Here too the market demand was considerably lower than in the same period in 2011.

Perspectives full year 2012

In 2012, Campine celebrates its hundred year's birthday, which is a historical milestone.

The whole world is in the grip of economic pressures which also affect our results. The first semester was break even. The outlook for the second half of the year is challenging.

Due to these economic circumstances, the Board of Directors decided on August 23 to adjust the BU organization of the Campine Group to optimally use synergies between different departments by installing a matrix structure.

We will take further steps to make extra savings when necessary.

Thanks to the improvements in the field of information, automation and management Campine is well prepared for the future.

Campine has survived several crises in its 100-year existence and the Board of Directors is convinced that our strong team will continue successfully in order to start our second century of existence in 2013 powerfully.

Shares

The company reminds the shareholders of the fact that the bearer shares which have not been converted by operation of law in accordance with the provisions of the law of 14 December 2005 on the abolition of bearer securities, must ultimately be converted on 30 September 2012 (hereafter the "Ultimate Conversion Date") in registered shares or in dematerialized form.

Risks and uncertainties

Campine, together with all other companies, is confronted with a number of uncertainties as a consequence of worldwide developments. The management aims to tackle these in a constructive way.

Campine pays particular attention to:

• Fluctuations on the commodity markets such as energy and metals;
• Major developments in the field of environment and health / safety including legislation regarding sales (REACH) and stocking (SEVESO) of chemical substances.

'000 EUR	Notes	30/06/2012	30/06/2011
Profit for the period		60	5.036
Other comprehensive income		-	-
Total comprehensive income for the period		60	5.036
Attributable to:
Equity holders of the parent		60	5.036
Minority interest		-	-

Condensed consolidated overview of other comprehensive income for the period

Condensed consolidated balance sheet

'000 EUR	Notes	30/06/2012	31/12/2011
ASSETS
Non-current assets
Property, plant and equipment	7	10.502	10.182
Intangible assets	8	834	786
Cash restricted in its use		300	300
		11.636	11.268
Current assets
Inventories	9	32.535	42.524
Trade and other receivables		31.993	25.924
Derivatives	10	522	68
Cash and cash equivalents		1.508	1.048
		66.558	69.564
TOTAL ASSETS		78.194	80.832
EQUITY AND LIABILITIES
Capital and reserves
Share capital		4.000	4.000
Translation reserves		-	-
Retained earnings*		21.436	23.302
Equity attributable to equity holders of the parent		25.436	27.302
Total equity		25.436	27.302
Non-current liabilities
Retirement benefit obligation		511	578
Deferred tax liabilities		44	141
Bank loans	11	4.125	5.475
Provisions	12	1.621	1.616
		6.301	7.810
Current liabilities
Retirement benefit obligation		165	188
Trade and other payables		13.724	18.009
Derivatives	10	119	393
Current tax liabilities		2.175	3.276
Bank overdrafts and loans	11	29.986	23.561
Provisions	12	288	293
		46.457	45.720
Total liabilities		52.758	53.530
TOTAL EQUITY AND LIABILITIES		78.194	80.832

* Retained earnings consist of legal reserves (965 KEUR) and other reserves and retained results (20.471 KEUR)

Condensed consolidated cash-flow statement

'000 EUR	Notes	30/06/2012	30/06/2011
OPERATING ACTIVITIES
Result for the year		60	5.036
Adjustments for:
Other gains and losses (investment grants)		-	- 2
Investment revenues		-	- 3
Other gains and losses (hedging results)	10	- 745	177
Finance costs		490	546
Income tax expense	5	3	2.467
Depreciation cost
		1.611	1.382
Change in provisions (incl. retirement benefit)		- 90	- 100
Change in inventory value reduction		-	-
Others		- 2	2
Operating cash flows before movements in working capital		1.327	9.505
Change in inventories		9.989	- 4.346
Change in receivables		- 6.069	- 15.240
Change in trade and other payables		- 4.285	- 3.356
Cash generated from operations		962	- 13.437
Hedging results		18	- 169
Interest paid		- 490	- 546
Income taxes paid		- 1.201	- 276
Net cash (used in) / from operating activities		- 711	- 14.428
INVESTING ACTIVITIES
Interest received		-	3
Proceeds on disposal of property, plant and equipment		37	-
Purchases of property, plant and equipment	7	- 1.863	- 1.382
Purchases of intangible assets	8	- 153	-
Net cash (used in) / from investing activities		- 1.979	- 1.379
FINANCING ACTIVITIES
Dividends and tantièmes paid	6	- 1.925	- 2.300
Repayments of borrowings	11	- 1.350	- 1.442
New bank loans raised			7.500
Change in bank overdrafts	11	6.425	11.068
Net cash (used in) / from financing activities		3.150	14.826
Net increase / (decrease) in cash and cash equivalents		460	- 981
Cash and cash equivalents at the beginning of the year		1.048	1.572
Effect of foreign exchange rate changes			-
Cash and cash equivalents at the end of the period		1.508	591
Bank balances and cash		1.508	591

Condensed consolidated statement of changes in equity

'000 EUR	Share capital	Retained earnings	Attributable to equityholders of the parent	Total
Balance at 30 June 2011	4.000	24.286	28.286	28.286
Balance at 31 December 2011	4.000	23.302	27.302	27.302
Result of the period		60	60	60
Dividends and tantièmes (see note 6)		- 1.925	- 1.925	1.925 -
Balance at 30 June 2012	4.000	21.436	25.436	25.436

Notes to the condensed consolidated financial statements

1. Basis of preparation

The condensed financial statements have been prepared in accordance with International Accounting Standard (IAS) 34 Interim Financial Reporting as adopted by the EU.

2. Significant accounting policies

The same accounting policies, presentation and methods of computation are followed in these condensed financial statements as were applied in the preparation of the Group's financial statements for the year ended 31 December 2011.

3. Segment information

For management purposes, the Group is organised into three operating divisions: Antimony, Plastics & Lead. These divisions are the basis on which the Group reports its primary segment information. Principal activities as follows:

• Antimony trioxide (Sb2O3) is used as a fire retardant in the textile, plastics, cable and pigment industries and is also applied as a high efficiency catalyst in PET-production.
• Our plastics activities enable us to offer predispersed and ready to use flame retardant masterbatches for processors and compounders to provide a dust-free handling and increase production efficiency.
• Our lead recycling business is based on converting lead from used car and truck batteries and industrial scrap into lead bullion and alloys that are marketed to battery and lead sheet producers (a.o. X-ray protection).

Segment information about the Group's continuing operations is presented hereafter:

'000 EUR	Antimony 30/06/2012	Plastics 30/06/2012	Lead 30/06/2012	Eliminations / others 30/06/2012	Total 30/06/2012
REVENUE
External sales	41.710	11.544	32.708	- 91	85.871
Total revenue	41.710	11.544	32.708	- 91	85.871
Inter-segment sales are charged at prevailing market prices
RESULT
Segment operating result Unallocated expenses	1.711	504	241	-	2.456 - 2.648
Operating result Investment revenues			-		- 192 -
Hedging results Other gains and losses Finance costs			745		745 - - 490
Result before tax Income tax expense					63 - 3
Result for the period					60
'000 EUR	Antimony	Plastics	Lead	Others	Total
OTHER INFORMATION
Capital additions 2012 Depreciation and amortisation	404 272	166 83	348 845	1.098 448	2.016 1.648
BALANCE SHEET
Assets
Fixed assets	1.804	570	5.408	3.554	11.336
Cash restricted in its use	-	-	300	-	300
Stocks Trade and other receivables	13.972 13.843	5.095 4.476	12.449 10.657	1.019 3.017	32.535 31.993
Derivatives	-	-	522	-	522
Cash and cash equivalent	-	-	-	1.508	1.508
Total assets	29.619	10.141	29.336	9.098	78.194

The unallocated expenses concern mainly remuneration for general services, insurances, IT, costs for safety, health and environment, maintenance and depreciation of general intangible assets.

'000 EUR	Antimony	Plastics	Lead	Eliminations / others	Total
	30/06/2011	30/06/2011	30/06/2011	30/06/2011	30/06/2011
REVENUE
External sales	56.026	14.898	34.493	1.099	106.516
Total revenue	56.026	14.898	34.493	1.099	106.516
Inter-segment sales are charged
at prevailing market prices
RESULT
Segment operating result	5.588	1.423	3.093	-	10.104
Unallocated expenses					- 1.882
Operating profit Investment revenues					8.222 3
Hedging results			- 177		- 177
Other gains and losses					-
Finance costs					- 546
Result before tax					7.502
Income tax expense					- 2.467
Result for the period					5.035
'000 EUR	Antimony	Plastics	Lead	Others	Total
OTHER INFORMATION
Capital additions 2011	473	90	270	549	1.382
Depreciation and amortisation	183	89	858	252	1.382
BALANCE SHEET
Assets
Total assets	42.773	11.226	32.100	4.530	90.629

4. Other operating expense

'000 EUR	30/06/2012	30/06/2011
Office expenses	432	367
Fees	439	382
Insurances	204	121
Transportation costs	762	838
Interim personnel	461	535
Waste disposal	693	1.023
Travel expenses	119	104
Other sales expenses	336	562
Expenses on operational hedges	186	157
Operational exchange rates	307	815
Others	922	614
	4.861	5.518

5. Income tax (charge) credit

		Period
'000 EUR	30/06/2012	30/06/2011
Current tax Deferred tax	100 - 97	2.496 - 29
Income tax expense for the year	3	2.467

The total tax expenses of the Group over the first semester 2012 amounts to 4,2 %, compared to 32,9 % for the first semester ending on 30 June 2011.

6. Dividends and tantièmes paid during the period

On 31 May 2012, a dividend of 1.25 EUR per share (total dividend EUR 1.875 million) was paid to shareholders.

On 31 May 2011, a dividend of 1.50 EUR per share (total dividend EUR 2.25 million) was paid.

An amount of 50 KEUR was paid as tantièmes to the Board members.

7. Significant movements in property, plant and equipment

		Properties
	Land and	under	Fixtures and
'000 EUR	buildings	construction	equipment	Total
COST OR VALUATION
At 31 December 2011	12.609	162	46.414	59.185
Additions	198		1.665	1.863
Transfers		- 162	162	-
Disposals	-			-
At 30 June 2012	12.807	-	48.241	61.048
ACCUMULATED DEPRECIATION AND IMPAIRMENT
At 31 December 2011	9.937	-	39.066	49.003
Depreciation charge for the year	216		1.290	1.506
Eliminated on disposals	37			37
At 30 June 2012	10.190	-	40.356	50.546
CARRYING AMOUNT
At 30 June 2012	2.617	-	7.885	10.502
At 31 December 2011	2.672	162	7.348	10.182

8. Significant movements in other assets

'000 EUR	Licences, patents and trademarks
COST
At 31 December 2011	1.152
Additions	153
At 30 June 2012	1.305
AMORTISATION
At 31 December 2011	366
Charge for the year	105
At 30 June 2012	471
CARRYING AMOUNT
At 30 June 2012	834
At 31 December 2011	786

9. Inventories

'000 EUR	30/06/2012	31/12/2011
Raw materials	7.869	19.701
Work-in-progress	10.534	6.923
Finished goods	14.132	15.900
	32.535	42.524

The inventory per 30 June includes a value reduction of 2,417KEUR (31/12/2011: 3,237 KEUR) to value inventory at the lower of cost and net realisable value.

10. Derivatives

The table below summarizes the net change in fair value – realised and unrealised – of +745 KEUR included in the income statement during the first semester ended 30 June 2012 (31 December 2011: +1,808 KEUR).

'000 EUR	Fair value of current instruments	Underlying open positions (tons)	Change in fair value in income statement
At 31 December 2011	- 325	4.875	1.808
At 30 June 2012	403	4.200	745

The fair value of the derivatives are included in the balance sheet as current assets – derivatives for 522 KEUR and current liabilities – derivatives for 119 KEUR. The amount of 119 KEUR is related to the open position of the fixed price-purchase contracts on 30 June 2012.

11. Bank borrowings (finance lease obligations not included)

'000 EUR	30/06/2012	31/12/2011
Bank loans	6.825	8.175
Bank overdrafts	27.286	20.861
	34.111	29.036

The borrowings are repayable as follows:

'000 EUR	30/06/2012	31/12/2011
Bank loans after more than one year	4.125	5.475
Bank loans within one year	2.700	2.700
Bank overdrafts on demand	27.286	20.861
	34.111	29.036

The average interest rates paid were as follows:

	30/06/2012	31/12/2011
Bank overdrafts	2,20%	2,70%
Bank loans	4,85%	4,90%

To fulfil the potential increased need of working capital, the credit facilities amounting to EUR 24 million were increased to EUR 30 million.

Bank loans are arranged at fixed interest rates. Other borrowings (bank overdrafts for an amount of 27,286 KEUR (31/12/2011: 20,861 KEUR)) are arranged at floating rates, thus exposing the Group to an interest rate risk.

At 30 June 2012, the Group had available 4,222 KEUR (31/12/2011: 4,187 KEUR) of undrawn committed borrowing facilities in respect of which all conditions precedent had been met.

12. Provisions

The provision for both the soil sanitation and the "concrete plan" remained unchanged during the first semester 2012. At the beginning of the second semester, we started with the next phase of the soil sanitation plan. During the 2nd semester the "concrete plan" will be executed following the foreseen planning.

13. Related party transactions

Trading transactions

During the year, group entities entered into the following trading transactions with related parties that are not members of the Group:

Purchase of antimony metal from F.W. Hempel Intermétaux SA for an amount of 6,700 KEUR. Sales of antimony metal to F.W. Hempel Intermétaux SA for an amount of 233 KEUR.

Other transactions

• Camhold performed certain administrative/management services for the Campine Group, for which a management fee of 9 KEUR (30/06/2011: 30 KEUR) was charged and paid, being an appropriate allocation of costs incurred by relevant administrative departments.
• Hempel Wire Ltd performed certain administrative/management services for the Campine Group, for which a management fee of 20 KEUR (30/06/2011: 20 KEUR) was charged and paid, being an appropriate allocation of costs incurred by relevant administrative departments.

14. Significant events after balance sheet date

Between 30 June 2012 and the date these interim financial statements were authorised for issue, no important events occurred.

15. Approval of interim financial statements

The interim financial statements were approved and authorised for issue by the Board of Directors of 23 August 2012.

This information is also available in Dutch. Only the Dutch version is the official version. The English version is a translation of the original Dutch version.

For further information you can contact Karin Leysen (tel. no +32 14 60 15 49) (email: Karin.Leysen@campine.be)

Limited review report on the consolidated interim financial information for the six-month period ended 30 June 2012

To the Board of Directors

We have performed a limited review of the accompanying consolidated condensed balance sheet, condensed income statement, condensed statement of comprehensive income, condensed cash flow statement, condensed statement of changes in equity and selective notes (jointly the "interim financial information") of Campine NV ("the company") and its subsidiaries (jointly "the group") for the six-month period ended 30 June 2012. The Board of Directors of the company is responsible for the preparation and fair presentation of this interim financial information. Our responsibility is to express a conclusion on this interim financial information based on our review.

The interim financial information has been prepared in accordance with international financial reporting standard IAS 34 – Interim Financial Reporting as adopted by the European Union.

Our limited review of the interim financial information was conducted in accordance with international standard ISRE 2410 – Review of interim financial information performed by the independent auditor of the entity. A limited review consists of making inquiries of group management and applying analytical and other review procedures to the interim financial information and underlying financial data. A limited review is substantially less in scope than an audit performed in accordance with the International Standards on Auditing (ISA). Accordingly, we do not express an audit opinion on the interim financial information.

Based on our limited review, nothing has come to our attention that causes us to believe that the interim financial information for the six-month period ended 30 June 2012 is not prepared, in all material respects, in accordance with IAS 34 – Interim Financial Reporting as adopted by the European Union.

Antwerp, 24 August 2012

The statutory auditor

DELOITTE Bedrijfsrevisoren BV o.v.v.e. CVBA Represented by Kathleen De Brabander