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Salzgitter AG — Earnings Release 2014
Nov 13, 2014
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Earnings Release
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Corporate | 13 November 2014 07:30
Salzgitter AG: Important intermediate target reached – the Salzgitter Group achieves an impressive turnaround in the first nine months of 2014
Salzgitter AG / Key word(s): Interim Report/9-month figures
13.11.2014 / 07:30
- Q3/2014: another increase in quarterly profit
- Net financial position significantly strengthened versus first half
- Earnings guidance for the financial year 2014 affirmed
The Salzgitter Group generated a pre-tax profit in the first nine months of 2014, thereby delivering the first positive nine-month result since 2011. Factors contributing to this impressive turnaround include primarily the impact of the “Salzgitter AG 2015” restructuring program that is increasingly taking effect and the gratifying contribution from the Aurubis investment. Compared with accounts of the first half-year, the net financial position improved notably to EUR 270 million (June 30, 2014: EUR 156 million). With an equity ratio of 37%, the Salzgitter Group has a sound balance sheet and financial position for dealing with the ongoing structural crisis in the European steel market, while also continuing to develop its broad-based portfolio of business activities.
The situation of the European steel market was tense throughout the entire reporting period as the supply of many rolled steel products continued to exceed demand. Weaker contributions by the Trading Business Unit, resulting first and foremost from price-and volume-induced effects, caused consolidated external sales to drop 6 % to EUR 6,811.5 in the first nine months of 2014 (first nine months of 2013: EUR -7,279.3 million). By contrast, the consolidated result improved to post a pre-tax profit of 5.5 million, which represents significant headway compared with the previous year (first nine months of 2013: EUR -365.6 million). This amount includes EUR 42.4 million in contribution from the Aurubis investment. The after-tax result stood at EUR -12.2 million (first nine months of 2013: EUR -382.7 million), which brings basic earnings per share to EUR -0.28 (first nine months of 2013: EUR -7.13), and the return on capital employed posted 1.5 % (first nine months of 2013: -10.7 %). When considering the year-on-year comparisons, it should be noted that the key data of the financial year 2013 have been restated to take account of the new Group organization structure and changes in the consolidation methods applied to participating interests under IFRS 11.
External sales by business unit (EUR million):
| 9M 2014 | (9M 2013 restated) | |
| Strip Steel | 1,607.9 | (1,572.2) |
| Plate / Stection Steel | 845.1 | (846.2) |
| Energy | 939.3 | (1,019.8) |
| Trading | 2,404.8 | (2,867.2) |
| Technology | 877.2 | (823.6) |
| Industrial Participations / Consolidation | 137.2 | (150.3) |
| Group | 6,811.5 | (7,279.3) |
Earnings before taxes (EBT) by business unit (EUR million):
| 9M 2014 | (9M 2013 restated) | |
| Strip Steel | -3.9 | (-49.3) |
| Plate / Stection Steel | -60.1 | (-313.8) |
| Energy | -20.5 | (- 23.7) |
| Trading | 16.1 | (27.6) |
| Technology | 13.2 | (4.7) |
| Industrial Participations / Consolidation | 60.8 | (-11.1) |
| Group | 5.5 | (-365.6) |
Not least due to the fact that production and shipment volumes are always lower at year-end, the fourth quarter is likely to be weaker than the earnings trend in the previous quarters. Nonetheless, based on planning by the individual business units, and taking account of notable successes from measures implemented, as well as structural improvements from the “Salzgitter AG 2015” groupwide program, the Salzgitter Group affirms its earnings guidance so far for the year. We have revised our sales guidance downward to take account of declines in rolled steel selling prices caused by lower raw materials prices as well as the downturn in shipment volumes.
Net of non-recurrent effects in the context of drawing up the annual accounts, we now assume the following for the financial year 2014:
- sales of around EUR 9 billion
- a significant increase in the pre-tax result, approaching breakeven, compared with the financial year 2013 and
- another moderately positive return on capital employed.
Additional information can be found in the full press release and the financial report published today ( www.salzgitter-ag.com/en ).
Guidance on the development of the macroeconomic situation is already fundamentally subject to a great deal of uncertainty, particularly in the current environment prevailing in Europe. As in recent years, we make reference to the fact that opportunities and risks from currently unforeseeable trends in selling prices, input material prices and capacity level developments, as well as changes in the currency parity, may considerably affect performance in the course of the financial year 2014. Additional positive or negative effects may arise from structural or methodological changes. This includes in particular measurement pursuant to IFRS standards. The resulting fluctuation in the consolidated pre-tax result may be within a considerable range, either to the positive or to the negative.
Disclaimer: Some of the statements made in this report possess the character of forecasts or may be interpreted as such. They are made upon the best of information and belief and by their nature are subject to the proviso that no unforeseeable deterioration occurs in the economy or in the specific market situation pertaining to the division companies, but rather that the underlying bases of plans and outlooks prove to be accurate as expected in terms of their scope and timing. Notwithstanding prevailing statutory provisions and capital market law in particular, the company undertakes no obligation to continuously update any forward-looking statements that are made solely in connection with circumstances prevailing on the day of their publication.
Contact:
Markus Heidler
Head of Investor Relations
Salzgitter AG
Eisenhüttenstraße 99
38239 Salzgitter
Phone +49 5341 21-6105
Fax +49 5341 21-2570
E-Mail [email protected]
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| Language: | English |
| Company: | Salzgitter AG |
| Eisenhüttenstraße 99 | |
| 38239 Salzgitter | |
| Germany | |
| Phone: | +49 5341 21-01 |
| Fax: | +49 5341 21-2727 |
| E-mail: | [email protected] |
| Internet: | www.salzgitter-ag.de |
| ISIN: | DE0006202005 |
| WKN: | 620200 |
| Listed: | Regulierter Markt in Frankfurt (Prime Standard), Hannover; Freiverkehr in Berlin, Düsseldorf, Hamburg, München, Stuttgart |
| End of News | DGAP News-Service |
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| 296844 13.11.2014 |