SGL CARBON SE — Earnings Release 1998

Nov 3, 1998

News Details

Ad-hoc | 3 November 1998 09:27

Ad hoc-Service: SGL Carbon AG englisch

—————————————————————— Ad hoc-Service: SGL Carbon AG englisch Ad-hoc announcement sent by DGAP. The sender is solely responsible for the contents of this announcement. —————————————————————————— Operating Results plus 9% despite economic slowdown Consolidated sales of SGL CARBON improved by 9% over the previous year to DM 1,639 million between January and September 1998, with sales remaining almost unchanged at DM 538 million in the third quarter. Although operating results for the first nine months rose by 9% to DM 301 million, the negative effects of the South-East Asian turmoil and lower capacity utilization due to seasonal effects saw third-quarter earnings drop by DM 8 million to DM 90 million. Pre-tax earnings are significantly affected by the DM 410 million provision set up on June 30 for potential liabilities arising from the ongoing antitrust investigations. At minus DM 146 million, they are therefore not directly comparable with the previous year’s figure of DM 248 million. Eliminating this expecptional factor would produce a 6% increase in earnings to DM 263 million. Only a portion of the provision is tax-deductible. The Company therefore recorded a net loss after taxes of DM 197 million for the first nine months. At DM 170 million, the net income on a comparable basis would have risen by 12% as against the previous year. Due to a lower tax rate net income of the third quarter was DM 58 million (1997: DM 55 milllion). According to DVFA/SG earnings per share increased from DM 7.35 to DM 8.47. Gross cash flow dropped to minus DM 96 million. No significant payments have thus far been booked against the reserve. Therefore the directly comparable figure is up 12% over the previous year, at DM 272 million. This provides us with a sound basis for continuing our expansion in the Technical Product and Specialty Graphite Business Areas as planned. To improve the basis for sustained earnings growth, SGL CARBON is working on the acceleration of our planned far-reaching rationalization program, including a reduction in graphite electrode capacity. Due to this acceleration we plan to provide for this in the fourth quarter which would reduce the operating results for the year below 1997`s level. The whole rationalization program will result in substantially reduced costs already in 1999 and the following years. End of Message