Earnings Release • May 5, 2020
Earnings Release
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Statement for the First Quarter 2020
(€ million, unless specified otherwise)
| Q1 2020 | Q1 2019 | Change | |
|---|---|---|---|
| Key operational data | |||
| Steel dust throughput (tonnes) | 185,656 | 168,968 | 9.9 % |
| Waelz oxide (WOX) sold (tonnes) | 67,708 | 53,189 | 27.3 % |
| Salt slags and Spent Pot Linings (SPL) recycled (tonnes) | 124,697 | 129,095 | (3.4) % |
| Secondary aluminium alloys produced (tonnes) | 47,919 | 47,965 | (0.1) % |
| LME zinc average price (€ / tonne) | 1,930 | 2,380 | (18.9) % |
| Blended zinc price (€ / tonne) | 2,114 | 2,373 | (10.9) % |
| Aluminium alloy average market price (€ / tonne) | 1,433 | 1,528 | (6.2) % |
| Key financial data | |||
| Revenue | 179.0 | 179.1 | (0.1) % |
| EBITDA | 33.6 | 43.0 | (22.0) % |
| EBITDA margin (% of revenue) | 18.7 % | 24.0 % | (5.3) p.p. |
| EBIT | 24.1 | 34.6 | (30.3) % |
| EBIT margin (% of revenue) | 13.5 % | 19.3 % | (5.8) p.p. |
| Financial result | (4.3) | (4.1) | 3.1 % |
| Profit before taxes and minority interests | 19.8 | 30.4 | (34.8) % |
| Net profit attributable to shareholders of Befesa S.A. | 14.7 | 22.1 | (33.5) % |
| EPS (in €) based on 34,066,705 shares | 0.43 | 0.65 | (33.5) % |
| Total assets1 | 1,145.0 | 1,115.8 | 2.6 % |
| Capital expenditures | 11.7 | 12.9 | (9.0) % |
| Cash flow from operating activities | 8.4 | 17.6 | (52.5) % |
| Cash and cash equivalents at the end of the period | 119.9 | 154.8 | (22.5) % |
| Net debt2 | 422.6 | 383.0 | 10.3 % |
| Leverage3 | x 2.8 | x 2.2 | |
| Number of employees (as of end of the period) | 1,153 | 1,161 | (0.7) % |
1 2019 figure as of 31 December
2Net debt computed as non-current loans and borrowings + non-current lease liabilities + current loans and borrowings
3 Leverage ratio computed as net debt divided by last twelve months (LTM) EBITDA
▼ Lower zinc hedging prices: €2,244 per tonne in Q1 2020 (vs. €2,327 per tonne in Q1 2019) The negative price effects above were partially offset by positive volume and mix/efficiency effects: ▲ Electric arc furnace (EAF) dust throughput up 10% yoy; primarily driven by the resumption of operations in Turkey after expanding the plant capacity
▲ High-efficiency furnace upgrades in Secondary Aluminium Spanish plants (Erandio and Les Franqueses del Vallès) delivering in 2020
In Q1 2020, consolidated revenue remained flat at €179.0 million (Q1 2019: €179.1 million). The revenue development was primarily driven by the increased EAF dust throughput in Steel Dust Recycling Services mainly due to the plant in Turkey fully operating in Q1 2020 (compared to only one month during Q1 2019 as it was shut down to expand its capacity). The revenue development was offset by the reduced zinc and aluminium alloys market prices, the lower zinc hedging prices, the unfavourable zinc reference TC and the slight decrease in salt slags and SPL volumes.
In Q1 2020, EBITDA decreased by 22.0% to €33.6 million (Q1 2019: €43.0 million). The main drivers and impacts that explain the €9 million EBITDA decrease yoy were: Lower metal prices (zinc LME €-6 million; Unfavourable zinc reference TC €-2.5 million; Aluminium alloy FMB €-0.5 million); Lower zinc hedging prices (€-2 million); Slightly lower salt slags volumes due to Covid-19 downtimes in Spain (€-0.5 million). These effects were partially offset by the higher EAF dust throughput in Steel Dust Recycling Services (€+3 million) and the furnace upgraded in 2019 in the Secondary Aluminium plant in Les Franqueses del Vallès (Spain) delivering results in 2020 (€+0.5 million).
Similarly, EBIT declined by 30.3% to €24.1 million (Q1 2019: €34.6 million), following the drivers that explain the EBITDA development.
In Q1 2020, the consolidated financial result amounted to €-4.3 million, at similar level compared to the same period of prior year (Q1 2019: €-4.1 million). The reduction in financial expenses was driven by lower interest rates (Euribor+225 bps on average in Q1 2020 vs. Euribor+250 bps on average in Q1 2019) as a result of the refinancing of the capital structure in July 2019 and repricing in February 2020, was offset by the negative effect from net exchange differences.
Q1 2020 consolidated net profit attributable to the shareholders decreased by 33.5% to €14.7 million (Q1 2019: €22.1 million), primarily due to the commented drivers impacting EBITDA and EBIT.
Financial indebtedness as of 31 March 2020 amounted to €542.5 million, relatively flat compared to year-end 2019. Compared to year-end 2019, net debt increased slightly in Q1 2020 by €5.7 million to €422.6 million.
The following table reconciles net debt to the relevant balance sheet line items:
| 31 March | 31 December | |
|---|---|---|
| 2020 | 2019 | |
| Non-current financial indebtedness | 531.4 | 530.2 |
| + Current financial indebtedness | 11.2 | 12.2 |
| Financial indebtedness | 542.5 | 542.4 |
| - Cash and cash equivalents | (119.9) | (125.5) |
| - Other current financial assets1 | (0.1) | (0.1) |
| Net debt | 422.6 | 416.9 |
| EBITDA LTM | 150.1 | 159.6 |
| Leverage ratio | x 2.8 | x 2.6 |
1 Other current financial assets adjusted by hedging valuation
Q1 2020 operating cash flow amounted to €8.4 million, down €9.2 million yoy (Q1 2019: €17.6 million), driven by the commented earnings reduction, which were partially offset by improved working capital. Operating cash flow during the last-twelve-months period as of 31 March 2020 remained solid at €93.3 million. After investing €16.2 million to fund regular maintenance capex and growth investments (China), Befesa closed Q1 with stable €120.0 million cash on hand. Considering the €75 million RCF entirely undrawn to date, Befesa continued with a strong liquidity of about €200 million available at Q1 closing.
Q1 2020 closed at a leverage of x2.8 EBITDA and Befesa continues to be compliant with all debt covenants.
Steel dust recycling volumes processed in Q1 2020 amounted to 185,656 tonnes, representing a 9.9% yoy increase (Q1 2019: 168,968 tonnes). This increase is driven by the incremental volumes from the plant in Turkey after the capacity expansion in 2019. The European plants as well as the plant in South Korea operated at high utilisation levels. With these volumes, steel dust recycling plants have been running in Q1 2020 at an average load factor of 90.2% of the expanded latest installed annual capacity of 825 thousand tonnes (Q1 2019: 92.7%). As a result, the volume of WOX sold increased by 27.3%, to 67,708 tonnes in Q1 2020 (Q1 2019: 53,189 tonnes).
In Q1 2020, revenue increased by 6.4% to €101.2 million (Q1 2019: €95.1 million). This was primarily due to the mentioned 9.9% increase in EAF dust throughput. The revenue increase was partially offset by the lower average zinc spot (-19% yoy) and hedging prices (Q1 2020: €2,244 per tonne; Q1 2019: €2,327 per tonne), both resulting in lower zinc effective average prices (blended rate between hedged volume and non-hedged volume), which decreased during Q1 by 10.9% yoy to €2,114 per tonne (Q1 2019: €2,373 per tonne). In addition, the revenue increase was also partially offset by the more unfavourable zinc TC referenced at around \$300 per tonne in 2020 (2019: \$245 per tonne). Combined, the price effect (zinc LME and TC) in Q1 amounted to 28% yoy.
EBITDA decreased by 23.4%, to €26.0 million in Q1 2020 (Q1 2019: €33.9 million). Similarly, EBIT decreased by 29.5% to €20.9 million in Q1 2020 (Q1 2019: €29.6 million). Earnings in Q1 were impacted by the mentioned lower zinc spot and hedging prices as well as by the unfavourable zinc reference TC, partially offset by the commented improvement in EAF dust throughput.
Salt slags and SPL recycled volumes in Q1 2020 amounted to 124,697 tonnes, a slight decrease of 3.4% yoy (Q1 2019: 129,095 tonnes). Capacity utilisation levels remained very high at 94%.
In Q1 2020, revenue in the Salt Slags subsegment decreased by 0.8% to €22.1 million (Q1 2019: €22.3 million) and was primarily driven by the 6.2% decrease in prices for aluminium alloys (Q1 2020: €1,433 per tonne; Q1 2019: €1,528 per tonne, on average) paired with the slightly lower salt slags and SPL recycled volumes.
EBITDA in the Salt Slags subsegment decreased by 8.3% to €5.9 million in Q1 2020 (Q1 2019: €6.4 million). Similarly, EBIT in Q1 2020 declined by 15.9% to €3.6 million (Q1 2019: €4.3 million).
Aluminium alloy production volumes in Q1 2020 amounted to 47,919 tonnes, flat yoy.
In Q1 2020, revenue decreased by 8.6% to €65.4 million (Q1 2019: €71.6 million), primarily driven by lower aluminium alloy average prices.
EBITDA in the Secondary Aluminium subsegment grew 8.8% yoy to €2.7 million in Q1 2020. EBIT slightly decreased by 5.5% to €0.7 million. The increase in EBITDA was primarily driven by higher margins due to the more efficient secondary aluminium furnaces upgraded in 2019 which are delivering results. These improvements partially offset the slightly reduced volumes of salt slags and SPL recycled and the lower prices for aluminium alloys.
A key element of Befesa's business model is its hedging strategy to manage the zinc price volatility and increase the visibility of its earnings and cash flow going forward.
The hedging currently in place provides Befesa with improved pricing visibility through 2020 and the first ten months of 2021. The average hedged prices and volumes for each of the periods are as follows:
| Period | Average hedged price (€ per tonne) |
Zinc content hedged (tonnes) |
|---|---|---|
| 2017 | €1,876 | 73,200 |
| 2018 | €2,051 | 92,400 |
| 2019 | €2,310 | 92,400 |
| 2020 | €2,250 | 92,400 |
| October YTD 2021 | €2,200 | 57,300 |
Befesa will continue its hedging strategy, targeting stability even if foregoing short-term upside from higher zinc prices. In light of the current zinc market environment Befesa is closely monitoring to hedge the remaining 50% targeted hedge tonnage of Q3 2021, as well as the volume for Q4 2021 and beyond. Befesa's strategy is to hedge 60% to 75% of the expected volume of zinc contained in WOX for a period of around one to four years going forward.
In 2019, Befesa successfully completed three organic growth projects which are delivering results in 2020, namely:
In 2020, another major organic growth project has top priority: Befesa continues working on expanding the capacity of its existing salt slags recycling plant in Hannover (Germany) by 40,000 tonnes to 170,000 tonnes. After having presented the full detailed project to the German environmental authorities, Befesa is currently providing technical-related details as requested by the authorities and expects to obtain the final permission by the end of 2020. The improved capacity will help to meet the increase in existing and new customer demand.
The expansion of the Steel Dust Recycling Services operations into China is progressing in both provinces – Jiangsu and Henan.
With regards to the first EAF dust recycling plant in the province of Jiangsu: After the temporary shutdown due to the Covid-19 pandemic, the construction site (located in Changzhou) reopened on 10 March 2020. The construction progresses and its completion is expected by the beginning of 2021.
Regarding the first EAF dust recycling plant in the province of Henan (Befesa's second EAF dust recycling plant in China): During Q1, Befesa continued preparing the site (located in XuChang) for construction, which is expected to be finalised by the middle of 2021.
The two plants in development are designed to each recycle 110,000 tonnes of EAF steel dust per year and will represent Befesa's seventh and eighth crude steel dust recycling sites globally, along with existing sites in Europe, Turkey and South Korea.
The year 2020 is expected to be a period of solid operating performance benefiting from the executed projects of 2019. The impact from the Covid-19 crisis on Befesa is expected to come mainly through depressed metal prices and lower secondary steel and aluminium production volumes at its customers plants leading to lower hazardous waste generation.
Befesa expects 2020 EBITDA to range between €100 and €135 million. The position within the range depends mainly on how the Covid-19 pandemic impacts the European crude steel and automotive markets and the base metal prices in the remaining quarters of the year.
The lower-end case (2020 EBITDA: €100 million) assumes a second pandemic wave prolonging lockdowns, with the European crude steel production market (in Q1 -10% yoy) decreasing severely during the remaining quarters by 37% yoy each (for the 2020 full year -30% yoy, similar to the latest severe global crisis in 2008/09). In this scenario, Befesa's plants would be expected to run overall at approximately 80% capacity utilisation levels. With regards to metal prices, LME zinc spot prices are assumed to decrease in the remaining quarters to the Q1 low levels of around €1,650 to €1,700 per tonne. The combined price impact (Zinc LME and TC) would be around -39% yoy. In EBITDA terms, the remaining quarters would be assumed at a run-rate of approximately €22 million per quarter, resulting in €100 million EBITDA for the full year 2020.
The upper-end case (2020 EBITDA: €135 million) assumes that the European crude steel production market in Q2 would be materially down yoy, with lockdowns easing by the end of Q2, and no second pandemic wave in H2. As a result, Befesa's impact on volumes would be limited, with plants overall running at around 90% capacity utilisation levels. With regards to metal prices, LME zinc spot prices are assumed to recover in H2 to €1,750 to €1,850 per tonne. With zinc TC at around \$300 per tonne, the combined price impact (Zinc LME and TC) would be around -30% yoy. In EBITDA terms, Q2 is assumed to be the lowest quarter in 2020 with H2 EBITDA run-rate levels recovering.
China: during Q1 Befesa experienced, due to the Covid-19 outbreak, a one-month delay in terms of the construction of its two plants under development. However, Nanjing HQ office reopened on 25 February and the construction site in Changzhou (Jiangsu province) reopened on 10 March. In the mid-term, Befesa's expectations about the business opportunity in China remains unchanged. The Chinese Government is strongly committed to environmental protection and the EAF steel market in China is already the largest worldwide. These two facts highlight the need for the recycling service solutions that Befesa provides. Befesa continues to fund its China expansion as part of the 2020 capex guidance.
By reducing its discretionary cost and non-vital capital expenditures, Befesa targets for 2020 €70 million total capex. Approximately €20 million will be used to maintain Befesa's assets at their usual operational levels and €50 million would be invested mostly on developing the two steel dust recycling plants in China.
This level of investments would lead to a pre-dividend cash flow ranging between -/+€5 million (lower-end) and +€25 to €35 million (upper-end). Respectively, cash on hand pre-dividend is expected to be around €120 million (lower-end) and €150 million (upper-end).
With regards to dividend payment for financial year 2019, to conservatively balance dividend stability and cash flow, Befesa will propose in the AGM on 18 June 2020 to:
Despite the temporary challenges that the Covid-19 pandemic poses, Befesa remains fully confident about its future growth prospects thanks to its strong leading position in an attractive industrial services field supported by mega trends.
Even at the lower-end €100 million EBITDA (-38% yoy and similar to the severe 2008/09 global financial crisis levels),
Befesa's strong and conservative backbone, represented by its long-term capital structure with no covenants nor maturities up to July 2026, its proven hedging strategy, as well as its resilient underlying business model and resulting cash flow, serves the Company well to weather the challenging quarters ahead.
For an overview of the lower- and upper- end guidance framework, please refer to the table on the following page.
Finally, in 2020 Befesa will continue to improve its communication regarding sustainability and ESG with its investors and other stakeholders. This ensures that the vital position of Befesa within the circular economy and its contribution to a more sustainable world are clearly understood. Befesa's Sustainability Report 2019 is scheduled for publication in Q2 2020.
| A D T BI m E 00 d: €1 wer-en Lo |
A D T BI m E 35 d: €1 pper-en U |
|
|---|---|---|
| market EU crude steel Covid-19 &- - |
YoY (like 2009 wn Q4 each severely do wns % No recovery; Prolonged lockdo wn ~30 Q1; Q2 to % YoY; Annually do me crisis) EU-28 volu % in After -10 -37 ▪ ▪ |
mic wave pande & Q4 recovering and no 2nd causing further lockdowns in H2 by end Q2 wn YoY wn easing materially do Lockdo Q2 Q3 ▪ ▪ ▪ |
| mance Operational perfor |
% Overall capacity utilisation at ~80 ▪ |
% Overall capacity utilisation at ~90 me mpact on volu mited i Li ▪ ▪ |
| Metal prices | % YoY & TC) -39 w €1,650-€1,700/t ME mpact (L Q1 lo mbined price i Q4 at ~ at \$300/t Q2 to TC Co ▪ ▪ ▪ |
% YoY H2 recovering to €1,750/t to €1,850/t; & TC) -30 ME mpact (L mbined price i at \$300/t TC Co ▪ ▪ ▪ |
| A D FY 2020 EBIT |
m run-rate m '19) % YoY) % YoY vs. €117 m / -38 €22 ~reduced m (-€60 m (-44 FY 2020 EBITDA: €100 maining quarters Q4 at €66 Q3+ Q2+ Re ▪ ▪ ▪ |
% YoY) west quarter in 2020 and m / -16 % YoY) m (-€25 m (-14 run-rate recovery in H2 FY 2020 EBITDA: €135 Q4 at €101 Q2 lo ming Q3+ Assu Q2+ ▪ ▪ ▪ |
| Capex | & non-vital capex ~€20 m growth (China); ~€20 Reducing discretionary cost m: ~€50 Total capex of ~€70 ▪ ▪ |
map; wth road m to protect core gro maintenance; m regular |
| & cash Pre-dividend w cash flo |
m Cash position ~€120 m €5 + /- Approx. ▪ ▪ |
m m Cash position ~€150 Approx. +€25 to €35 ▪ ▪ |
| Dividend | balancing dividend stability and cash flo mproved visibility about the i Proposing to distribute an ordinary dividend of €15 mber (post in Nove Review an additional dividend flow Q3 2020 YTD and the i Conservatively → ▪ ▪ |
& cash Q3 earnings release) depending on earnings m or €0.44/share in July m Covid-19 mpact fro w |
as of 31 March 2020 (€ thousand)
| (€ thousand) | 31 March 2020 | 31 December 2019 |
|---|---|---|
| Non-current assets: | ||
| Intangible assets | ||
| Goodwill | 335,564 | 335,564 |
| Other intangible assets | 86,633 | 86,912 |
| 422,197 | 422,476 | |
| Right-of-use asset | 23,322 | 17,409 |
| Property, plant and equipment | ||
| Property, plant and equipment in use | 271,901 | 263,357 |
| Property, plant and equipment under construction | 31,353 | 45,235 |
| 303,254 | 308,592 | |
| Non-current financial assets | ||
| Investments in Group companies and associates | 118 | 118 |
| Other non-current financial assets | 18,787 | 18,507 |
| 18,905 | 18,625 | |
| Deferred tax assets | 70,298 | 70,913 |
| Total non-current assets | 837,976 | 838,015 |
| Current assets: | ||
| Inventories | 50,907 | 54,739 |
| Trade and other receivables | 56,301 | 42,786 |
| Trade receivables from related companies | 894 | 751 |
| Accounts receivables from public authorities | 12,768 | 10,771 |
| Other receivables | 19,908 | 18,557 |
| Other current financial assets | 46,289 | 24,737 |
| Cash and cash equivalents | 119,923 | 125,460 |
| Total current assets | 306,990 | 277,801 |
| Total assets | 1,144,966 | 1,115,816 |
| (€ thousand) | 31 March 2020 | 31 December 2019 |
|---|---|---|
| Equity: | ||
| Parent Company | ||
| Share capital | 94,576 | 94,576 |
| Share premium | 263,875 | 263,875 |
| Hedging and revaluation reserves | 43,895 | 26,951 |
| Other reserves | (33,276) | (117,286) |
| Translation differences | (11,137) | (4,396) |
| Net profit/(loss) for the period | 14,690 | 82,713 |
| Equity attributable to the owners of the Company | 372,623 | 346,433 |
| Non-controlling interests | 12,251 | 13,785 |
| Total equity | 384,874 | 360,218 |
| Non-current liabilities: | ||
| Long-term provisions | 9,981 | 8,759 |
| Loans and borrowings | 519,158 | 519,210 |
| Lease liabilities | 12,211 | 11,013 |
| Deferred tax liabilities | 73,741 | 68,053 |
| Other non-current liabilities | 7,958 | 9,265 |
| Total non-current liabilities | 623,049 | 616,300 |
| Current liabilities: | ||
| Loans and borrowings | 7,125 | 8,621 |
| Trade payables to related companies | 855 | 835 |
| Trade and other payables | 94,179 | 90,916 |
| Lease liabilities | 4,049 | 3,572 |
| Short-term provisions | 121 | 124 |
| Other payables | ||
| Accounts payable to public administrations | 18,804 | 17,033 |
| Other current liabilities | 11,910 | 18,197 |
| 30,714 | 35,230 | |
| Total current liabilities | 137,043 | 139,298 |
| Total equity and liabilities | 1,144,966 | 1,115,816 |
| (€ thousand) | Q1 2020 | Q1 2019 | Change |
|---|---|---|---|
| Continuing operations: | |||
| Revenue | 179,028 | 179,135 | (0.1) % |
| Changes in inventories of finished goods | |||
| and work in progress | (7,200) | 1,903 | >(100) % |
| Procurements | (73,775) | (77,760) | (5.1) % |
| Other operating income | 638 | 1,027 | (37.9) % |
| Personnel expenses | (21,066) | (20,300) | 3.8 % |
| Other operating expenses | (44,071) | (40,995) | 7.5 % |
| Amortisation/depreciation, impairment and provisions | (9,449) | (8,436) | 12.0 % |
| Operating profit (EBIT) | 24,105 | 34,574 | (30.3) % |
| Finance income | 43 | 89 | (51.7) % |
| Finance expenses | (4,291) | (4,506) | (4.8) % |
| Net exchange differences | (19) | 279 | >(100) % |
| Net finance income/(loss) | (4,267) | (4,138) | 3.1 % |
| Profit/(loss) before tax | 19,838 | 30,436 | (34.8) % |
| Corporate income tax | (5,982) | (7,472) | (19.9) % |
| Profit/(loss) for the period | |||
| from continuing operations | 13,856 | 22,964 | (39.7) % |
| Profit/(loss) for the period | 13,856 | 22,964 | (39.7) % |
| Attributable to: | |||
| Parent Company owners | 14,690 | 22,100 | (33.5) % |
| Non-controlling interests | (834) | 864 | >(100) % |
| Earnings/(losses) per share from continuing and | |||
| discontinued operations attributable to owners | |||
| of the Parent (expressed in euros per share) | |||
| Basic earnings per share | |||
| From continuing operations | 0.43 | 0.65 | (33.5) % |
| From discontinued operations | - | - | |
| 0.43 | 0.65 | (33.5) % |
| (€ thousand) | Q1 2020 | Q1 2019 |
|---|---|---|
| Cash flow from operating activities: | ||
| Profit / (loss) for the period before tax | 19,838 | 30,436 |
| Adjustments due to: | 14,678 | 13,217 |
| Depreciation and amortisation | 9,449 | 8,436 |
| Changes in long-term provisions | 1,222 | 841 |
| Interest income | (43) | (89) |
| Finance costs | 4,291 | 4,506 |
| Other profit/(loss) | (260) | (198) |
| Exchange differences | 19 | (279) |
| Changes in working capital: | (11,097) | (12,932) |
| Trade receivables and other current assets | (17,468) | (14,983) |
| Inventories | 3,832 | 38 |
| Trade payables | 2,539 | 2,013 |
| Other cash flows from operating activities | (15,042) | (13,101) |
| Interest paid | (9,482) | (8,063) |
| Taxes paid | (5,560) | (5,038) |
| Net cash flows from/(used in) operating activities (I) | 8,377 | 17,620 |
| Cash flows from investing activities: | ||
| Investments in intangible assets | (96) | (317) |
| Investments in property, plant and equipment | (16,104) | (12,800) |
| Collections from disposal of Group and associated companies, net of cash | - | 14 |
| Investments in other current financial assets | - | (87) |
| Net cash flows from/(used in) investing activities (II) | (16,200) | (13,190) |
| Cash flows from financing activities: | ||
| Cash inflows from bank borrowings and other liabilities | 3,648 | - |
| Cash outflows from bank borrowings and other liabilities | (1,034) | (15) |
| Net cash flows from/(used in) financing activities (III) | 2,614 | (15) |
| Effect of foreign exchange rate changes on cash and cash equivalents (IV) | (328) | (289) |
| Net increase/(decrease) in cash and cash equivalents (I+II+III+IV) | (5,537) | 4,126 |
| Cash and cash equivalents at the beginning of the period | 125,460 | 150,648 |
| Cash and cash equivalents at the end of period | 119,923 | 154,774 |
| Q1 2020 | Q1 2019 | Change | |
|---|---|---|---|
| Key operational data (tonnes, unless specified otherwise) | |||
| Steel dust throughput1 | 185,656 | 168,968 | 9.9 % |
| Waelz oxide sold | 67,708 | 53,189 | 27.3 % |
| Blended zinc price (€ / tonne) | 2,114 | 2,373 | (10.9) % |
| Total installed capacity2 | 825,300 | 780,300 | 5.8 % |
| Utilisation (%)2 | 90.2 % | 87.8 % | 2.4 p.p. |
| Total installed capacity normalised3 | 825,300 | 739,050 | 11.7 % |
| Normalised utilisation (%)3 | 90.2 % | 92.7 % | (2.5) p.p. |
| Key financial data (€ million, unless specified otherwise) | |||
| Revenue | 101.2 | 95.1 | 6.4 % |
| EBITDA | 26.0 | 33.9 | (23.4) % |
| EBITDA margin % | 25.6 % | 35.6 % | (10.0) p.p. |
| EBIT | 20.9 | 29.6 | (29.5) % |
| EBIT margin % | 20.6 % | 31.1 % | (10.5) p.p. |
ALUMINIUM SALT SLAGS RECYCLING SERVICES
Salt Slags subsegment
| Q1 2020 | Q1 2019 | Change | |
|---|---|---|---|
| Key operational data (tonnes, unless specified otherwise) | |||
| Salt slags and SPL recycled | 124,697 | 129,095 | (3.4) % |
| Total installed capacity | 630,000 | 630,000 | 0.0 % |
| Utilisation (%)4 | 94.4 % | 98.8% | (4.4) p.p. |
| Key financial data (€ million, unless specified otherwise) | |||
| Revenue | 22.1 | 22.3 | (0.8) % |
| EBITDA | 5.9 | 6.4 | (8.3) % |
| EBITDA margin % | 26.5 % | 28.7 % | (2.2) p.p. |
| EBIT | 3.6 | 4.3 | (15.9) % |
| EBIT margin % | 16.2 % | 19.1 % | (2.9) p.p. |
Secondary Aluminium subsegment
| Q1 2020 | Q1 2019 | Change | |
|---|---|---|---|
| Key operational data (tonnes, unless specified otherwise) | |||
| Secondary aluminium alloys produced | 47,919 | 47,965 | (0.1) % |
| Aluminium alloy average market price (€ / tonne)5 | 1,433 | 1,528 | (6.2) % |
| Total installed capacity6 | 205,000 | 205,000 | 0.0 % |
| Utilisation (%)6 | 93.8 % | 94.9 % | (1.1) p.p. |
| Key financial data (€ million, unless specified otherwise) | |||
| Revenue | 65.4 | 71.6 | (8.6) % |
| EBITDA | 2.7 | 2.5 | 8.8 % |
| EBITDA margin (% over revenue) | 4.2 % | 3.5 % | 0.7 p.p. |
| EBIT | 0.7 | 0.8 | (5.5) % |
| EBIT margin (% over revenue) | 1.1 % | 1.1 % | 0.0 p.p. |
1 Steel dust throughput does not include stainless steel dust volumes
| Thursday, 18 June 2020 |
Annual General Meeting |
|---|---|
| Friday, 31 | Publication of H1 2020 |
| July 2020 | interim report & analyst call |
| Thursday, 29 | Publication of Q3 2020 |
| October 2020 | statement & analyst call |
Notes: Befesa's financial reports and statements are published at 7:30 am CEST
Befesa cannot rule out changes of dates and recommends checking them in the Investor Relations / Investor's Agenda section of its website www.befesa.com
Director of Investor Relations & Strategy Phone: +49 (0) 2102 1001 340 email: [email protected]
You can find this and other publications online in the Investor Relations / Reports and Presentations section of Befesa's website www.befesa.com
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This quarterly statement contains forward-looking statements and information relating to Befesa and its affiliates that are based on the beliefs of its management, including assumptions, opinions and views of Befesa and its affiliates as well as information cited from third party sources. Such statements reflect the current views of Befesa and its affiliates or of such third parties with respect to future events and are subject to risks, uncertainties and assumptions.
Many factors could cause the actual results, performance or achievements of Befesa and its affiliates to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements, including, among others: changes in general economic, political, governmental and business conditions globally and in the countries in which Befesa and its affiliates do business; changes in interest rates; changes in inflation rates; changes in prices; changes to national and international laws and policies that support industrial waste recycling; legal challenges to regulations, subsidies and incentives that support industrial waste recycling; extensive governmental regulation in a number of different jurisdictions, including stringent environmental regulation; management of exposure to credit, interest rate, exchange rate and commodity price risks; acquisitions or investments in joint ventures with third parties; inability to obtain new sites and expand existing ones; failure to maintain safe work environments; effects of catastrophes, natural disasters, adverse weather conditions, unexpected geological or other physical conditions, or criminal or terrorist acts at one or more of Befesa's plants; insufficient insurance coverage and increases in insurance cost; loss of senior management and key personnel; unauthorised use of Befesa's intellectual property and claims of infringement by Befesa of others' intellectual property; Befesa's ability to generate cash to service indebtedness changes in business strategy and various other factors.
Should one or more of these risks or uncertainties materialise, or should underlying assumptions prove incorrect, actual results may vary materially from those described herein as anticipated, believed, estimated, expected or targeted. Befesa and its affiliates do not assume any guarantee that the assumptions underlying forward-looking statements are free of errors nor do they accept any responsibility for the future accuracy of the opinions expressed herein or the actual occurrence of the forecasted developments. No representation (express or implied) is made as to, and no reliance should be placed on, any information, including projections, estimates, targets and opinions, contained herein, and no liability whatsoever is accepted as to any errors, omissions or misstatements contained herein or otherwise resulting, directly or indirectly, from the use of this document.
This quarterly statement is intended for information only and should not be treated as investment advice. It is not intended as an offer for sale, or as a solicitation of an offer to purchase or subscribe to, any securities in any jurisdiction. Neither this quarterly statement nor anything contained therein shall form the basis of, or be relied upon in connection with, any commitment or contract whatsoever. This quarterly statement may not, at any time, be reproduced, distributed or published (in whole or in part) without prior written consent of Befesa.
First quarter 2020 figures contained in this quarterly statement have not been audited or reviewed by external auditors.
This quarterly statement includes Alternative Performance Measures (APMs), including EBITDA, EBITDA margin, EBIT, EBIT margin, net debt and capital expenditures which are not measures of liquidity or financial performance under International Financial Reporting Standards (IFRS). EBITDA is defined as operating profit for the period (i.e. EBIT) before the impact of amortisation, depreciation, impairment and provisions. EBITDA margin is defined as EBITDA divided by revenue. EBIT is defined as Operating profit for the year. The Company uses EBIT to monitor its financial return after both operating expenses and a charge representing the cost of usage of both its property, plant and equipment and definite‑life intangible assets. EBIT margin is defined as EBIT as a percentage of revenue. These non-IFRS measures should not be considered in isolation or as an alternative to results from operating activities, cash flow from operating, investing or financing activities, or other financial measures of Befesa's results of operations or liquidity derived in accordance with IFRS. Befesa believes that the APMs included in this quarterly statement are useful measures of its performance and liquidity. Other companies, including those in the industry in which Befesa operates, may calculate similarly titled financial measures differently than Befesa does. Because all companies do not calculate these financial measures in the same manner, Befesa's presentation of such financial measures may not be comparable to other similarly titled measures of other companies. These APMs are not audited.
Befesa S.A. 46, Boulevard Grande-Duchesse Charlotte L 1330 Luxembourg, Grand Duchy of Luxembourg www.befesa.com
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