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Afarak Group — Earnings Release 2017
May 12, 2017
3302_rns_2017-05-12_dbc6d6c9-2e1b-4413-b40d-7dceb64cbc72.html
Earnings Release
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AFARAK GROUP: INTERIM REPORT Q1/2017
AFARAK GROUP: INTERIM REPORT Q1/2017
07:00London, 09:00 Helsinki, 12 May 2017 - Afarak Group Plc ("Afarak" or "the
Company") (LSE: AFRK, NASDAQ: AFAGR) Interim Report
AFARAK GROUP: INTERIM REPORT Q1/2017
Strong start to the year, Group EBITDA at EUR 12.7 million.
HIGHLIGHTS IN THE FIRST QUARTER OF 2017
Afarak's EBITDA stood at EUR 12.7 million, compared to EUR 3.3 million a year
earlier. The significant improvement was due to higher ferrochrome prices and
strong market fundamentals, supported by productivity gains, primarily in
processing.
* Afarak registered the highest quarterly result since entering the mineral
business in 2008
* Processed material sold increased by 3.5% to 27,892 (Q1/2016: 26,952) tonnes
* Tonnage mined increased by 87.6% to 85,352 (Q1/2016: 45,486) tonnes
* Revenue increased by 39.0% to EUR 56.7 (Q1/2016: 40.8) million
* EBITDA was EUR 12.7 (Q1/2016: 3.3) million and the EBITDA margin was 22.4%
(Q1/2016: 8.0%)
* EBIT was EUR 11.1 (Q1/2016: 1.7) million and the EBIT margin was 19.6%
(Q1/2016: 4.2%)
* Profit for the period from continuing operations totalled EUR 4.2 (Q1/2016:
-0.2) million, with cash flow from operations standing at EUR 8.5 (Q1/2016:
7.2) million and liquid funds at 31 March were EUR 16.2 (31 March
2016: 21.7) (31 December 2016: 9.7) million
* Due to the exceptional results in quarter one 2017, an extraordinary EUR
0.02 per share distribution from the invested unrestricted equity fund is
now being recommended to the Annual General Meeting later this month
Key Group figures
Q1/17 Q1/16 2016
Revenue EUR million 56.7 40.8 153.6
EBITDA EUR million 12.7 3.3 5.5
EBIT EUR million 11.1 1.7 -1.0
Earnings before taxes EUR million 6.9 0.9 -3.1
Profit EUR million 4.2 0.2 -0.9
Earnings per share EUR 0.01 0.00 0.00
EBITDA margin % 22.4 8.0 3.6
EBIT margin % 19.6 4.2 -0.7
Earnings margin % 12.1 2.1 -2.0
Personnel at the end of the period 906 767 813
MARKET SENTIMENT FOR THE SECOND QUARTER 2017
As expected, the high price levels for ferrochrome and Chrome Ore seen in
quarter one, have not been sustainable over the longer term. We still expect
improved performance in Q2 2017 compared to a year earlier, although subdued,
when compared to Q1 2017 numbers.
CEO Guy Konsbruck
"Afarak has had a very strong start to the year. Our EBITDA improved
significantly from last year, reaching EUR 12.7 million. The strong market,
particularly higher ferrochrome and ore prices, had a notable positive impact on
our results. However, this bullish market has already started to dampen and
prices have reversed trends towards the end of quarter one, going into the
second quarter. I am particularly satisfied that our internal initiatives have
also contributed to further strengthening working capital management, higher
production volumes, productivity gains and considerable cost benefits. Our
shaking tables in South Africa and the successful transition of our furnaces
from silicomanganese to ferrochrome allowed us to increase production. The
commencement of opencast mining is also yielding a growing supply of material.
We are committed to continue implementing similar measures and initiatives aimed
at enhancing our productivity and further increasing our efficiency.
Both our business segments, speciality alloys and ferroalloys, delivered
significantly improved results, on the back of higher selling prices. This solid
performance was further supported by the joint venture in South African due to
higher sales volumes and improved sale prices. These results have allowed us to
propose to the forthcoming Annual General Meeting an extraordinary EUR 0.02 per
share distribution.
Looking ahead, the volatility of the market remains a key risk and we should not
expect record performances on a quarterly basis."
Disclosure procedure
Afarak follows the disclosure procedure enabled by Disclosure obligation of the
issuer (7/2013) published by the Finnish Financial Supervision Authority, and
hereby publishes its Q1/2017 interim report enclosed to this stock exchange
release. The Interim Report is attached to this release and is also available on
the Company's website at www.afarak.com.
Investor Conference Call
Management will host an investor conference call in English on 12 May 2017 at
12.00 Finnish time, 10.00 UK time. Please dial-in at least 10 minutes
beforehand, quoting the reference: 7467105
Finnish number +358 (0)9 7479 0361
UK number +44 (0)330 336 9105
Guy Konsbruck
CEO
Afarak Group plc
www.afarak.com
For additional information, please contact:
Guy Konsbruck, CEO, +356 2122 1566, [email protected]
Predrag Kovacevic, CFO, +356 2122 1566, [email protected]
Melvin Grima, Finance Director, +356 2122 1566, [email protected]
Jean Paul Fabri, PR Manager, +356 2122 1566, [email protected]
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