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R. Stahl AG

Quarterly Report May 18, 2021

344_10-q_2021-05-18_518d8751-b9ce-4564-b260-e03c2b1d5d08.pdf

Quarterly Report

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This report is available in German and English language. Both versions can also be found online on our corporate website www.r-stahl.com under Corporate/Investor Relations/Financial Reports. It contains forward-looking statements based on assumptions and estimates of R. STAHL's management. Although we assume that the expectations of these forward-looking statements are realistic, we cannot guarantee that these expectations will prove to be correct. The assumptions may involve risks and uncertainties that could cause the actual results to differ materially from the forward-looking statements. Factors that may cause such discrepancies include: changes in the macroeconomic and business environment, exchange rate and interest rate fluctuations, the roll-out of competing products, a lack of acceptance of new products or services, and changes in business strategy. R. STAHL does not plan to update these forward-looking statements nor does it accept any obligation to do so.

Alternative performance indicators

The alternative performance indicators EBITDA pre exceptionals and EBITDA margin pre exceptionals that are used in this report are not defined by international accounting standards. R. STAHL uses these indicators to improve the comparability of its business performance over time. EBITDA pre exceptionals is derived from earnings before interest, taxes, depreciation and amortization (EBITDA) less adjustments classified as exceptionals (restructuring charges, non-scheduled depreciation and amortization, charges for design and implementation of IT-projects, M&A costs as well as profit and loss from the disposal of non-current assets no longer required for business operations). EBITDA margin pre exceptionals describes EBITDA pre exceptionals in percentage of sales.

Rounding differences and rates of change

Percentages and figures in this report may include rounding differences. The signs used to indicate rates of change are based on economic aspects. Improvements are indicated by a "+" sign, deteriorations by a "-" sign. Rates of change >+100% are shown as >+100%, rates of change <-100% as "n/a" (not applicable).

R. STAHL GROUP

Key Figures
in € million Q1 2021 Q1 2020 Change
in %
Sales 58.2 65.1 -10.6
Germany 14.6 16.9 -13.4
Central region 1) 28.2 29.2 -3.3
Americas 4.8 7.2 -33.8
Asia/Pacific 10.5 11.8 -10.6
EBITDA pre exceptionals 2.7 4.7 -44.0
EBITDA margin pre exceptionals 4.6% 7.3%
EBITDA 2.6 4.7 -44.3
EBIT -1.5 0.5 n/a
Net profit -2.5 -0.6 n/a
Earnings per share in € -0.39 -0.10 n/a
Order intake 63.9 78.8 -18.8
Order backlog as of March 31 68.9 79.9 -13.7
Cash flow from operating activities -1.3 0.9 n/a
Depreciation and amortization 4.1 4.2 -1.3
Capital expenditures 3.2 2.3 +37.1
31 March
2021
31 Dec.
2020
Change
in %
Total assets 255.5 256.2 -0.3
Equity 51.4 48.1 +6.7
Equity ratio 20.1 % 18.8 %
Net financial debt 2) 11.6 5.8 +99.5
Net financial debt incl. lease liabilities pursuant to IFRS 16 38.2 33.1 +15.4
Employees 3) 1,679 1,690 -0.7

1) Africa and Europe excl. Germany

2) excl. pension provision and excluding lease liabilities

3) excl. apprentices

INTERIM REPORT

of R. Stahl Aktiengesellschaft for the period 1 January 2021 through 31 March 2021

CONTENTS

  • 2 Key topics in the reporting period
  • 3 Group management report
  • 8 Consolidated financial statements
  • 13 Selected explanatory notes
  • 15 Financial calendar and contact

KEY TOPICS IN THE REPPORTING PERIOD

Changes in the Executive Board and Supervisory Board of R. STAHL

Changes in the Executive Board and Supervisory Board of R. STAHL

R. STAHL is setting a course for ongoing consistent implementation of its strategic agenda with personnel changes to the Executive Board and Supervisory Board. Jürgen Linhard, member of the Executive Board of R. STAHL AG, left the company for personal reasons as of 31 March 2021. Furthermore, Rudolf Meier, member of the Supervisory Board and the Administrative Committee of R. STAHL AG, has stepped down from his position prematurely as of 15 April 2021.

GROUP MANAGEMENT REPORT

  • Sales of €58.2 million in Q1 2021 down 10.6% or €6.9 million year-on-year (Q1 2020: €65.1 million)
  • EBITDA pre exceptionals declines by €2.1 million to €2.7 million (Q1 2020: €4.7 million) – ongoing cost adjustments continue to noticeably cushion impact of weak sales development
  • Exceptionals in Q1 2021 unchanged at <€-0.1 million (Q1 2020: €-0.1 million)
  • Net profit decreases by €1.9 million to €-2.5 million (Q1 2020: €-0.6 million) and earnings per share to €-0.39 (Q1 2020: €-0.10)
  • Negative net profit and ongoing strategy implementation lead to temporary slight increase in net financial debt to €11.6 million
  • First signs of market recovery: Demand up by about 13% to €63.9million in Q1 2021 compared with the average of the three prior quarters
  • Forecast for 2021 detailed: Sales between €250 million and €256 million, EBITDA pre exceptionals between €17 million and € 19 million

Business Development

Sales and order intake

As in the prior three quarters, R. STAHL's business development in Q1 2021 was again clearly impacted by the effects of the COVID 19 pandemic. The low order backlog at

the beginning of the year in particular led to a 10.6% yearon-year decline in sales to €58.2 million (Q1 2020: €65.1 million). Compared to the previous quarter, sales declined by €3.9 million (Q4 2020: €62.1 million). Development was weaker in all regions. Sales of €14.6 million were generated in Germany (Q1 2020: €16.9 million), a drop of 13.4%. This development mainly reflects the decline in international investment projects, which was also evident in weaker business in the German machinery sector. By contrast, sales in the Central region - which consists of Africa and Europe excluding Germany - fell by a relatively moderate 3.3% year-on-year to €28.2 million in the reporting quarter (Q1 2020: €29.2 million). The comparatively high share of sales in customer industries not directly affected by the decline in demand in the oil and gas sector had a stabilizing effect. By contrast, there was an entirely different trend in the Americas region, where the reluctance to invest in the oil and gas sector resulted in a 33.8% year-on-year decline in sales to €4.8 million (Q1 2020: €7.2 million). This also impacted the Asia/Pacific region. In addition, the postponement of major projects had a negative impact on the development of sales in this region, which resulted in an overall decline in sales of 10.6% to €10.5 million (Q1 2020:

By contrast, order intake in the first quarter of 2021 was significantly higher than sales. In fact, orders declined by 18.8% to €63.9 million compared to the very strong previous year (Q1 2020: €78.8 million). Compared to the previous quarter, however, this represents an increase of 20% (Q4 2020: €53.3 million). This encouraging performance was driven in particular by follow-up material requirements from major projects, catch-up effects from postponed procurement activities as well as maintenance and repair orders for production equipment in operation. As a result, order backlog increased to €68.9 million compared with the level at the beginning of the year (31 December 2020: €64.5 million).

in € million Q1 2021 Q1 2020 Change
in %
in % of
Group sales
Germany 14.6 16.9 -13.4 25
Central region 28.2 29.2 -3.3 49
Americas 4.8 7.2 -33.8 8
Asia/Pacific 10.5 11.8 -10.6 18
Total 58.2 65.1 -10.6 100

€11.8 million).

Sales by region

EBITDA and EBIT

The €6.9 million drop in sales also led to a decline in earnings before interest, taxes, depreciation and amortization (EBITDA) pre exceptionals in Q1 2021 which, due to targeted measures that included personnel cost adjustments, was limited to a decline of €2.1 million to €2.7 million (Q1 2020: €4.7 million). This resulted in an EBITDA margin pre exceptionals of 4.6% (Q1 2020: 7.3%). At <€-0.1 million, exceptionals remained at a very low level (Q1 2020: €-0.1 million), resulting in EBITDA of €2.6 million in the reporting quarter (Q1 2020: €4.7 million).

Total performance decreased by 12.7% to €61.3 million in the first quarter of 2021 (Q1 2020: €70.2 million). Reflected here is the reduction in inventories of finished goods and work in progress of €-2.3 million as a result of increased shipments.

Cost of materials decreased by 11.7% to €-21.4 million in the reporting period (Q1 2020: €-24.3 million), resulting in what continues to be a low cost of materials ratio that is at 35.0% of total performance – only slightly higher year-onyear (Q1 2020: 34.5% of total performance).

Personnel expenses fell by 4.7% to €-30.0 million in the reporting period (Q1 2020: €-31.5 million), mainly due to temporarily reduced working hours at the Waldenburg site.

The balance of other operating income and other operating expenses decreased by 26.0% to €-7.2 million in the first quarter of 2021 (Q1 2020: €-9.8 million). This was mainly attributable to lower travel expenses, lower legal and consulting fees, lower expenses for temporary workers and favorable changes in foreign exchange rates.

Amortization of intangible assets and depreciation of property, plant and equipment was largely unchanged compared with the previous year. In the reporting period, these amounted to €-4.1 million (Q1 2020: €-4.2 million).

This resulted in negative EBIT of €-1.5 million in the reporting period (Q1 2020: €0.5 million). EBIT was thus € 2.0 million below the level of the previous year

in € million Q1 2021 Q1 2020 Change included in income
statement under
EBITDA pre exceptionals 2.7 4.7 -2.1
Exceptionals 1) -0.0 -0.1 0.0
Restructuring charges -0.0 -0.1 0.0
Severance pay -0.0 -0.0 -0.0 Personnel costs
Legal and consulting costs 0.0 0.0 0.0 Other operating expenses
Others 0.0 0.0 0.0 Other operating expenses
EBITDA 2.6 4.7 -2.1
Depreciation and amortization -4.1 -4.2 0.1
EBIT -1.5 0.5 -2.0

Reconciliation of EBITDA pre to EBIT

Financial result

At €-0.5 million, the financial result in the first quarter of 2021 was at the level of the previous year (Q1 2020: €-0.4 million). This mainly includes the result of ZADOV Goreltex, which is accounted for using the equity method, in the amount of €0.2 million (Q1 2020: €0.4 million) as well as interest and similar expenses in the amount of €-0.7 million (Q1 2020: €-0.8 million).

Earnings before income taxes

Earnings before income taxes decreased by €2.1 million year-on-year to €-2.0 million in the first quarter of 2021 (Q1 2020: €0.1 million).

Income taxes

Income taxes amounted to €-0.6 million in the first quarter of 2021 (Q1 2020: €-0.7 million). Of that amount, €-0.2 million related to effective taxes and €-0.4 million to deferred taxes.

Net profit/ Earnings per share

In the first quarter of 2021, net profit fell by €1.9 million to € -2.5 million (Q1 2020: € -0.6 million). This corresponds to earnings per share of €-0.39 (Q1 2020: €-0.10).

in € million Q1 2021 Q1 2020 Change
EBIT -1.5 0.5 -2.0
Financial result -0.5 -0.4 -0.1
Earnings before income taxes -2.0 0.1 -2.1
Income taxes -0.6 -0.7 +0.2
Net profit -2.5 -0.6 -1.9
thereof
attributable to other shareholders
-0.0 0.0 -0.0
attributable to shareholders of R. STAHL AG -2.5 -0.6 -1.9
Earnings per share (in €) -0.39 -0.10 -0.29
Average number of shares outstanding
(weighted, in million units)
6.44 6.44 0

Reconciliation of EBIT to earnings per share

Net assets and financial position

Balance sheet structure

The R. STAHL Group's balance sheet total decreased slightly to €255.5 million as of 31 March 2021, compared to the end of the previous year (31 December 2020: €256.2 million).

Non-current assets decreased by €1.2 million as of the balance sheet date, mainly as a result of the decrease in deferred tax assets primarily attributable to the change in the discount rate used to valuate pension provisions.

There was a slight increase of €0.5 million in current assets to €103.7 million as of 31 March 2020 compared with the end of the previous year (31 December 2020: €103.2 million). Declining cash and cash equivalents were offset for the most part by an increase in inventories and trade receivables.

Non-current liabilities decreased by €7.1 million to €130.7 million by the end of the reporting period (31 December 2020: €137.8 million), mainly due to lower provisions for pension obligations which decreased by €6.0 million in the reporting period as a result of an increase in the discount rate. Lease liabilities also fell slightly by €0.7 million while interest-bearing loans declined by €0.3 million.

There was an increase of €3.2 million in current liabilities to €73.4 million as of 31 March 2021 compared with the end of the previous year (31 December 2021: €70.3 million). This was mainly due to an increase in the utilization of loans and higher accrued liabilities.

Equity improved by €3.2 million year-on-year to €51.4 million (31 December 2021: €48.1 million). This mainly reflects the beneficial effects of changes in foreign exchange rates and lower provisions for pension obligations. As a result, the equity ratio increased to 20.1% compared to the beginning of the year (31 December 2020: 18.8%).

Asset and capital structure

Financial position and investments

Negative net profit led to a year-on-year reduction in cash flow of €2.3 million to € 1.8 million in the reporting quarter (Q1 2020: €4.1 million). At €-3.1 million, working capital remained nearly unchanged year-on-year (Q1 2020: €-3.2 million). There were various offsetting effects in the reporting quarter: a lower increase in inventories was countered mainly by a decrease in prepayments received and a

reduction in trade payables. In the prior year, pandemic-related delays in deliveries resulted in a significant increase in inventories, and a higher share of sales from major projects led to increased advance prepayments received. Overall, there was a decrease in cash flow from operating activities of €2.3 million to €-1.3 million in the first quarter of 2021 (Q1 2020: €0.9 million).

In line with our strategic goal of maintaining and expanding our technology leadership, we increased spending on innovation projects in the reporting quarter. Compared

to the previous year, this was reflected in an increase of €0.8 million in investments in intangible assets to € 2.0 million (Q1 2020: €1.2 million). Cash flow from investing activities in the first quarter of 2021 increased to €3.2 million (Q1 2020: €2.2 million). Overall, free cash flow in the reporting quarter was €-4.5 million, corresponding to €3.2 million below the prior-year figure (Q1 2020: €-1.3 million).

Cash flow from financing activities decreased year-onyear to €1.5 million in Q1 2021, mainly due to lower borrowings of interest-bearing financial liabilities (Q1 2020: €3.8 million). There was a slight year-on-year decline in the repayment of lease liabilities.

As of 31 March 2021, the R. STAHL Group had cash and cash equivalents of €17.2 million at its disposal (31 December 2020: €19.9 million). Compared to the previous year, cash and cash equivalents thus increased by €0.3 million (Q1 2020: €17.0 million).

The negative free cash flow resulted in an increase in net debt (excluding pension provisions and leasing liabilities) of €5.8 million to €11.6 million at the end of the reporting quarter compared with the level at the beginning of the year (31 December 2020: €5.8 million).

Opportunities and risks

All R. STAHL subsidiaries regularly prepare an opportunity and risk report that takes into account the opportunities and risks of the company. Managing directors are required to inform the department responsible for opportunity and risk management of any significant events, including those that occur during the quarter. The relevant statements made in the Annual Report 2020 starting on page 46 continue to apply unchanged.

Outlook

We first presented our assessment of R. STAHL group's expected development in the current year in detail in the forecast beginning on page 78 of the Annual Report 2020, which was published on 16 April 2021. Accordingly, supported by a significant recovery in all relevant key markets, we anticipated year-on-year sales growth in the low single-digit percentage range for 2021, a development that should gain momentum in the course of the year. In this regard, the continued systematic implementation of our strategic agenda will result in a slight year-on-year decline in EBITDA pre exceptionals. This would lead to a slight reduction in the equity ratio for the year as a whole if the valuation of our pension provisions remains unchanged. We did not anticipate any significant change with regard to the very comfortable liquidity position we had at the beginning of the year. We continue to stand by this assessment and now detail it as follows:

For 2021, we expect sales to increase to between €250 million and € 256 million, with a weaker first half of the year followed by a significantly stronger second half. We expect EBITDA pre exceptionals for the full year to be between €17 million and €19 million.

Outlook FY 2021

in € million May 2021 April 2021 2020
Sales 250 – 256 low single-digit percentage growth 246.5
EBITDA pre exceptionals 17 – 19 slightly declining 19.0
Free cash flow ~6 stable 5.7
Equity ratio >18% slighty declining 18.8%

Income statement

Change
in €000 Q1 2021 Q1 2020 in %
Sales 58,173 65,104 -10.6
Change in finished and unfinished products 1,832 4,108 -55.4
Other own work capitalized 1,300 1,022 +27.2
Total operating performance 61,305 70,234 -12.7
Other operating income 3,139 3,371 -6.9
Cost of materials -21,432 -24,259 +11.7
Personnel costs -30,048 -31,537 +4.7
Other operating expenses -10,359 -13,134 +21.1
Earnings before financial result, income taxes
and depreciation and amortization (EBITDA)
2,605 4,675 -44.3
Depreciation and amortization -4,113 -4,169 +1.3
Earnings before financial result and income taxes (EBIT) -1,508 506 n/a
Result from companies consolidated using the equity method 221 385 -42.6
Investment result 0 0 0
Interest and similar income 24 42 -42.9
Interest and similar expenses -706 -835 +15.4
Financial result -461 -408 -13.0
Earnings before income taxes -1,969 98 n/a
Income taxes -552 -734 +24.8
Net profit -2,521 -636 n/a
thereof attributable to other shareholders -12 4 n/a
thereof attributable to shareholders of R. STAHL AG -2,509 -640 n/a
Earnings per share in € -0.39 -0.10 n/a

Statement of comprehensive income

in €000 Q1 2021 Q1 2020 Change
in %
Net profit -2,521 -636 n/a
Gains/losses from currency translation of foreign subsidiaries,
recognized in equity
1,344 -2,674 n/a
Deferred taxes on gains/losses from currency translation 0 0 0
Currency translation differences after taxes 1,344 -2,674 n/a
Other comprehensive income with reclassifications to profit for the period 1,344 -2,674 n/a
Gains/losses from the subsequent measurement of pension obligations, recog
nized in equity 5,961 6,700 -11.0
Deferred taxes from pension obligations -1,573 -1,956 +19.6
Other comprehensive income without reclassifications to
profit for the period 4,388 4,744 -7.5
Other comprehensive income
(valuation differences recognized directly in equity) 5,732 2,070 >+100
thereof attributable to other shareholders 8 -87 n/a
thereof attributable to shareholders of R. STAHL AG 5,724 2,157 >+100
Total comprehensive income after taxes 3,211 1,434 >+100
thereof attributable to other shareholders -4 -83 +95.2
thereof attributable to shareholders of R. STAHL AG 3,215 1,517 >+100

Balance sheet

in €000 31 March
2021
31 Dec.
2020
Change
ASSETS
Intangible assets 44,077 43,260 817
Property, plant & equipment 80,052 80,348 -296
Investments in associated companies 10,024 9,803 221
Other financial assets 32 32 0
Other assets 1,654 1,497 157
Investment property 4,655 4,707 -52
Deferred taxes 11,302 13,358 -2,056
Non-current assets 151,796 153,005 -1,209
Inventories and prepayments 39,283 36,938 2,345
Trade receivables 37,170 36,718 452
Contract receivables 609 637 -28
Income tax claims 136 471 -335
Other receivables and other assets 9,258 8,614 644
Cash and cash equivalents 17,244 19,854 -2,610
Current assets 103,700 103,232 468
Total assets 255,496 256,237 -741
EQUITY AND LIABILITIES
Share capital 16,500 16,500 0
Capital reserves 13,457 13,457 0
Retained earnings 57,537 60,046 -2,509
Accumulated other comprehensive income -36,370 -42,094 5,724
Equity attributable to shareholders of R. STAHL AG 51,124 47,909 3,215
Non-controlling interests 230 234 -4
Equity 51,354 48,143 3,211
Pension provisions 97,170 103,149 -5,979
Other provisions 2,060 2,048 12
Interest-bearing financial liabilities 8,442 8,781 -339
Lease liabilities 20,349 21,050 -701
Other liabilities 67 64 3
Deferred taxes 2,615 2,729 -114
Non-current liabilities 130,703 137,821 -7,118
Provisions 7,938 8,632 -694
Trade payables 12,154 13,805 -1,651
Interest-bearing financial liabilities 20,450 16,913 3,537
Lease liabilities 6,189 6,189 0
Deferred liabilities 15,980 12,394 3,586
Income tax liabilities 689 772 -83
Other liabilities 10,039 11,568 -1,529
Current liabilities 73,439 70,273 3,166
Total equity and liabilities 255,496 256,237 -741

Cash flow statement

in €000 Q1
2021
Q1
2020
Change
Net profit -2,521 -636 -1,885
Depreciation, amortization and impairment
of non-current assets 4,113 4,169 -56
Changes in non-current provisions -2 11 -13
Changes in deferred taxes 379 393 -14
Equity valuation -221 -385 +164
Other income and expenses without cash flow impact 58 657 -599
Result from the disposal of non-current assets -4 -99 +95
Cash flow 1,802 4,110 -2,308
Changes in current provisions -737 -619 -118
Changes in inventories, trade receivables and other non-capex
or non-financial assets
-2,370 -7,766 +5,396
Changes in trade payables and other non-capex or non-financial liabilities not at
tributable to investing of financing activities -34 5,200 -5,234
Changes in working capital -3,141 -3,185 +44
Cash flow from operating activities -1,339 925 -2,264
Cash outflow for capex in intangible assets -1,955 -1,153 -802
Cash outflow for capex on property, plant & equipment -1,264 -1,195 -69
Cash inflow from the disposals of property, plant & equipment and
real estate held as a financial investment
20 122 -102
Cash flow from investing activities -3,199 -2,226 -973
Free cash flow -4,538 -1,301 -3,237
Distribution to/contribution from minority shareholders 0 0 0
Cash outflow for down payment of lease liabilities -1,669 -1,838 +169
Cash inflow from interest-bearing liabilities 7,053 11,783 -4,730
Cash outflow for repayment of interest-bearing liabilities -3,856 -6,170 +2,314
Cash flow from financing activities 1,528 3,775 -2,247
Changes in cash and cash equivalents -3,010 2,474 -5,484
Foreign exchange and valuation-related changes in cash and
cash equivalents
400 -453 +853
Cash and cash equivalents at the beginning of the period 19,854 14,966 +4,888
Cash and cash equivalents at the end of the period 17,244 16,987 +257

Statement of changes in equity

Equity attributable to shareholders
Accumulated other comprehensive
Income
Re Unrealized Total
accu
mulated
other
Non
Sub tained Currency gains/ compre control
scribed Capital earn trans losses from hensive ling in
in €000 capital reserves ings lation pensions income Total terests Equity
1 Jan. 2020 16,500 13,457 63,555 -3,358 -32,163 -35,521 57,991 449 58,440
Net profit -640 -640 4 -636
Accumulated other
comprehensive in
come
-2,587 4,744 2,157 2,157 -87 2,070
Total comprehen
sive income
-640 -2,587 4,744 2,157 1,517 -83 1,434
Dividend
distribution
0 0
31 Mar. 2020 16,500 13,457 62,915 -5,945 -27,419 -33,364 59,508 366 59,874
1 Jan. 2021 16,500 13,457 60,046 -6,197 -35,897 -42,094 47,909 234 48,143
Net profit -2,509 -2,509 -12 -2,521
Accumulated other
comprehensive in
come
1,336 4,388 5,724 5,724 8 5,732
Total comprehen
sive income
-2,509 1,336 4,388 5,724 3,215 -4 3,211
Dividend
distribution
0 0
31 Mar. 2021 16,500 13,457 57,537 -4,861 -31,509 -36,370 51,124 230 51,354

SELECTED EXPLANATORY NOTES

1. Accounting in accordance with International Financial Reporting Standards (IFRS)

The interim financial statements for the R. STAHL AG Group have been prepared in accordance with International Financial Reporting Standards (IFRS), as applicable in the EU and in compliance with IAS 34 "Interim Financial Reporting". The interim consolidated financial statements have not been audited.

2. Scope of consolidation

In addition to R. STAHL AG, the interim consolidated financial statements include 31 domestic and foreign companies for which it is possible for R. STAHL AG to exercise a controlling influence.

Enterprises over which the Company can exercise substantial influence are included in the consolidated financial statements as associates using the equity method. Since 2016, ZAVOD Goreltex Co. Ltd, Saint Petersburg, Russia, has been included in the consolidated financial statements as an associate using the equity method. The scope of consolidation is unchanged over 31 December 2020.

3. Accounting and measurement methods

General information

The interim consolidated financial statements and the comparative figures for the prior-year period were generally prepared on the basis of the accounting and measurement methods applied in the consolidated financial statements for 2020. A description of these principles is published in the notes to the consolidated financial statements 2020. This can be viewed on the Internet at www.r-stahl.com.

The Group's functional currency is the euro. Unless indicated otherwise, all amounts are stated in thousands of euros (€000).

The consolidated financial statements have been prepared using the cost principle. Accounting for derivative financial instruments is the exception to this rule, as these must be accounted for at fair value.

The carrying amounts of cash and cash equivalents, as well as current account loans closely approximate

their fair values given the short maturity of these financial instruments. The carrying values of receivables and liabilities are based on historical costs, subject to usual trade credit terms, and also closely approximate their fair values.

The fair value of non-current liabilities is based on currently available interest rates for borrowing with the same maturity and credit rating profiles. The fair values of external liabilities is currently deviate only slightly from the carrying amounts.

To present the reliability of the valuation of financial instruments at fair value in a comparable manner, IFRS introduced a fair-value-hierarchy with the following three levels:

  • Valuation on the basis of exchange price or market price for identical assets or liabilities (Level 1)

  • Valuation on the basis of exchange price or market price for similar instruments or on the basis of assessment models that are based on market observable input parameters (Level 2)

  • Valuation on the basis of assessment models with significant input parameters that are not observable on the market (Level 3)

The derivative financial instruments measured at fair value of the R. STAHL Group are valued exclusively in accordance with the fair value hierarchy Level 2.

In the first three months of 2021, there were no reclassifications among the individual fair value hierarchies.

Cash flow statement

In accordance with IAS 7, the cash flow statement shows how the R. STAHL Group's flow of funds developed over the reporting period.

Cash and cash equivalents shown in the cash flow statement comprise cash on hand, cheques, and credit balances with banks. The item also includes securities with original maturities of up to three months.

Earnings per share

Earnings per share are calculated by dividing consolidated net profit - excluding non-controlling interests by the average number of shares. Diluted earnings per share correspond to earnings per share.

4. Sales in accordance with IFRS 15

Sales presented in the income statement includes both sales from contracts with customers and sales not within the scope of IFRS 15.

A breakdown of sales by sales source is shown below:

€000 Q1
2021
Q1
2020
Sales from contracts with cus
tomers
57,919 64,850
Rental income from real estate
held as financial investments
254 254
Total 58,173 64,104

A breakdown of sales by time of recognition is shown below:

€000 Q1
2021
Q1
2020
At a specific time 55,293 61,646
Over a specific period 2,880 3,458
Total 58,173 65,104

Sales are recognized over a specified period with a high probability of occurrence within a period of one to two months.

5. Financial instruments

R. STAHL mainly accounts for derivative financial instruments at fair value. For this reason, a detailed reconciliation statement for the carrying amounts and fair values for the individual classes is not provided for reasons of materiality.

Waldenburg, 11 May 2021 R. Stahl Aktiengesellschaft

Dr Mathias Hallmann CEO

The fair values of derivative financial instruments are as follows:

€000 31 March
2021
31 Dec.
2020
Positive market values
Currency derivatives
without hedging relationship
25 130
Negative market values
Currency derivatives
without hedging relationship
-9 -16

6. Number of employees

The number of employees at the 31 March 2021 reporting date was 1,679 (31 December 2020: 1,690) not including apprentices.

7. Contingent liabilities and other financial obligations

There have been no significant changes to contingent liabilities and other financial obligations compared with 31 December 2020.

8. Report on significant related party transactions

There were no significant transactions with related parties in the reporting period.

FINANCIAL CALENDAR 2O21

15 July

28th Annual General Meeting

12 August

Interim Report H1 2021

10 November

Interim Report Q3 2021

CONTACT – IMPRINT

Dr. Thomas Kornek Senior Vice President Investor Relations & Corporate Communications T: +49 7942 943 13 95 F: +49 7942 943 40 13 95 [email protected]

R. Stahl Aktiengesellschaft Am Bahnhof 30 74638 Waldenburg (Württ.) www.r-stahl.com

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