13 Mar 2014
SGL Group: Restructuring continues in 2014
Fiscal Year 2013:
• Sales decreased by 10% to €1,477 million compared to previous year
• EBIT before non‐recurring charges down to €19,5 million
• Non‐recurring charges and restructuring expenses of €227 million
• Free cash flow improved by €104 million to €38,2 million
• Outlook for 2014 impacted by continued difficult market environment in graphite electrodes
Wiesbaden, March 13th, 2014. The fiscal year 2013 developed weaker than originally anticipated for SGL Group – The Carbon Company – but in line with the adjusted June guidance. Primarily due to the unsatisfactory price development in graphite electrodes and the cyclical downturn in graphite specialties, Group sales declined by 10% to €1,477.0 million. As a result of the adverse development in all three Business Areas, Group EBIT before non‐recurring charges decreased to €19.5 million (2012: €164.4 million) and EBIT margin was down to 1.3 % (2012: 10.0 %). Group‐wide savings from the cost savings program SGL2015 amounted to approximately €69 million, thereby significantly exceeding the expected savings of €50 million. Approximately €27 million of savings were attributable to the SGL Excellence initiative.
Jürgen Köhler, CEO of SGL Group: “2013 was operationally one of the most difficult years ever for our Company and developed disappointingly. As a result, we implemented the comprehensive group‐wide cost savings program SGL2015 to counter the increasing challenges. Regarding the realignment of the Company, initial successes have been achieved. Now it is important to drive the restructuring process forward and return SGL Group to a sustainable profitable growth track. As a technology company, we will ensure a balance between cost savings and investments in future technologies and innovations.”
Significantly positive free cash flow of €38.2 million
Free cash flow improved significantly by €104 million to plus €38.2 million (2012: minus €66.2 million) due to substantially reduced working capital and lower cash used in investing activities. As a consequence, net financial debt of SGL Group was reduced to €447.7 million (December 31, 2012: €459.3 million).
SGL 2015
The implementation of SGL2015 will be consistently continued in 2014. Depending on the implementation progress of personnel measures, savings in the mid to high double‐digit million € range are targeted in 2014 after already having achieved savings of €69 million in 2013. In connection with SGL2015, further restructuring expenses will be incurred in 2014 amounting to a low double‐digit million € figure.
Capital expenditures will be higher in 2014 due to the scheduled capacity expansions at SGL Automotive Carbon Fibers, the joint venture with the BMW Group. Investments in the established business activities will be substantially lower compared to 2013.
Further information about SGL Group as well as the 2013 Annual Report can be found on the Company’s webpage: www.sglgroup.com.
Please also visit the new SGL Group news room at www.sglgroup.com/press.
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About SGL Group – The Carbon Company
SGL Group is one of the world’s leading manufacturers of carbon-based products and materials. It has a comprehensive portfolio ranging from carbon and graphite products to carbon fibers and composites. SGL Group’s core competencies are its expertise in high-temperature technology as well as its applications and engineering know-how gained over many years. These competencies enable the Company to make full use of its broad material base. SGL Group’s carbon-based materials combine several unique properties such as very good electrical and thermal conductivity, heat and corrosion resistance as well as high mechanical strength combined with low weight. Due to industrialization in the growth regions of Asia and Latin America and increased substitution of traditional with innovative materials, there is a growing demand for SGL Group’s high-performance materials and products. Products from SGL Group are used predominantly in the steel, aluminum, automotive and chemical industries as well as in the semiconductor, solar and LED sectors and in lithium-ion batteries. Carbon-based materials and products are also being used increasingly in the wind power, aerospace and defense industries.
With 44 production sites in Europe, North America and Asia as well as a service network covering more than 100 countries, SGL Group is a company with a global presence. In 2013, the Company’s workforce of around 6,300 employees generated sales of €1,477 million. The Company’s head office is located in Wiesbaden.
Further information on the SGL Group can be found online at: www.sglgroup.com
Important note:
This press release may contain forward-looking statements based on the information currently available to us and on our current projections and assumptions. By nature, forward-looking statements involve known and unknown risks and uncertainties, as a consequence of which actual developments and results can deviate significantly from these forward-looking statements. Forward-looking statements are not to be understood as guarantees. Rather, future developments and results depend on a number of factors; they entail various risks and unanticipated circumstances and are based on assumptions which may prove to be inaccurate. These risks and uncertainties include, for example, unforeseeable changes in political, economic, legal, and business conditions, particularly relating to our main customer industries, such as electric steel production, to the competitive environment, to interest rate and exchange rate fluctuations, to technological developments, and to other risks and unanticipated circumstances. Other risks that in our opinion may arise include price developments, unexpected developments connected with acquisitions and subsidiaries, and unforeseen risks associated with ongoing cost savings programs. SGL Group does not intend or assume any responsibility to revise or otherwise update these forward-looking statements.