12 Nov 2014
SGL Group continues with realignment after successful capital increase
• Group sales at €988 million 10 % below prior year due to price pressure in graphite electrodes
• Recurring EBIT at €3.0 million
• SGL2015 savings reached €61.2 million in reporting period – savings target increased to more than €200 million until the end of 2015
• Successful capital increase creates foundation for accelerated restructuring of the Group; significant improvements in key balance sheet metrics
• Further streamlining of organization to three Business Units
• Outlook for full year 2014 confirmed
Wiesbaden, November 12, 2014. SGL Group – The Carbon Company – continues with the realignment of the Group after nine months of the financial year 2014. With the capital increase successfully completed in October, the financial situation and key balance sheet metrics were improved. Taking into account the Company’s proceeds from the transaction, which are not yet included in the nine-month figures, the equity ratio increased to 33.6%. Net financial debt was significantly reduced to €366.7 million while gearing improved to 0.47. Cost savings from the Group-wide cost savings program SGL2015 totaled €61.2 million and exceeded original expectations after nine months. Total cost savings since the start of the program amounted to more than €130 million. The Company has already increased the overall SGL2015 savings target to more than €200 million until the end of 2015 compared to the original target of €150 million. An additional Group-wide optimization will result from the already announced further streamlining of the organization, merging the current five business units into three business units as of January 1, 2015.
The financial figures for the first nine months of fiscal year 2014 continue to be impacted by the difficult business environment, mainly in the field of graphite electrodes. The sales decline in the Performance Products segment, resulted in a decline in Group sales by 10% to €987,5 million (9M/2013: €1,096.2 million). Recurring Group EBIT amounted to €3.0 million (9M/2013: €35.4 million). The EBIT margin decreased from 3.2% to 0.3%. Non-recurring charges in the first nine months 2014 totaled €24.4 million (9M/2013: €69.8 million) and relate to restructuring expenses in conjunction with SGL2015. Accordingly, Group EBIT after non-recurring charges amounted to minus €21.4 million (9M/2013: minus €34.4 million).
Dr. Jürgen Köhler, CEO of SGL Group: “The capital increase which was successfully completed in October 2014 provides the basis for the accelerated strategic realignment of SGL Group. In particular, the implementation of the measures defined under our SGL2015 initiative is well under way. We were able to increase our overall savings target to more than €200 million. In parallel, we are now focusing more on portfolio optimization. Our goal is to return to a path of sustainable and profitable growth in the mid- to long-term.”
After nine months 2014, SGL Group confirms its guidance for the full year 2014, as published in March. Adjusted for the reclassification of the Business Unit Aerostructures as a discontinued operation, Group sales are expected on a comparable basis to decrease year-on-year in a similar magnitude as after nine months 2014. Mainly due to the graphite electrode price development, the comparable recurring Group EBIT is expected to be down significantly compared to 2013. While EBIT in the final quarter of this year is expected to deteriorate compared to the third quarter, it is anticipated to remain significantly above the fourth quarter of 2013.
The nine month report and further information about SGL Group can be found at: www.sglgroup.com as well as in the newsroom of SGL Group at: www.sglnewsroom.com/en/.
Reader enquiries
SGLNotes for editors
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 43 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.