|By PR Newswire||
|November 7, 2012 03:07 AM EST||
DUISBURG, Germany, November 7, 2012 /PRNewswire/ --
- Earnings trend affected by economic slowdown and ongoing price erosion. Restructuring program continuing to plan and significantly further expanded. Full-year EBITDA forecast of EUR130-140 million before restructuring
- Turnover in the first nine months increased by 9.1% to 5.5 million tons and sales by 7.4% to some EUR5.8 billion through acquisitions and strong organic growth in the USA
- EBITDA for the year to date at EUR117 million (including restructuring expenses: EUR97 million), compared with EUR203 million in first nine months of 2011
- Net income at a negative EUR33 million (including restructuring expenses and impairments: negative EUR 76 million), as against EUR38 million in the previous year
- Earnings per share at minus EUR 0.75, compared with EUR0.47 in the prior-year period
- Restructuring measures significantly expanded with reduction of approximately 60 locations and in the workforce by over 1,800; annual EBITDA contribution expected to be around EUR150 million
- Q4 EBITDA before restructuring expenses expected to be around third-quarter level, with a strong positive cash flow
- For the current year as a whole, turnover expected to increase by about 6.5% and sales by about 5%; EBITDA before restructuring expenses expected to be EUR130-140 million
All figures relate to the first nine months relative to the first nine months of the prior year
Klöckner & Co SE substantially increased turnover and sales in the first nine months, notably due to the acquisition of Macsteel Service Centers USA and strong organic growth in the USA. The EUR117 million EBITDA before restructuring expenses was nonetheless down on the prior-year figure due to the weaker economic trend in Europe and price pressure on steel products that has persisted since the end of the first quarter. As demand also rose less strongly than expected after summer, third-quarter EBITDA, at EUR19 million, was below the prior-year figure.
Gisbert Rühl, Chairman of the Management Board of Klöckner & Co SE: "We once again responded in good time to the strained situation in Europe and launched a comprehensive restructuring program as early as September 2011. This was a key factor in our ability to buffer the negative impacts of a very weak steel market at short notice. We have now significantly expanded the measures once more and have marked up the expected annual EBITDA contribution from the program to around EUR150 million. In contrast to Europe we made further gains in the US market where there is still dynamic growth, among other things thanks to the completed integration of Macsteel."
Turnover and sales increased, earnings below prior year Klöckner & Co increased turnover in the first nine months of fiscal 2012, primarily driven by acquisitions, by 9.1% to 5.5 million tons, compared with 5.0 million tons in the prior-year period.
In the Europe segment, turnover was down by 5.9% compared with the first nine months of 2011 due to the increasingly difficult economic environment and ongoing discontinuation of underperforming activities; the market as a whole contracted by no less than 9%.
In the Americas segment, by contrast, turnover increased by 41.3% compared with the first nine months of 2011, primarily due to acquisitions. Excluding the acquisition, turnover in the USA showed 6.7% organic growth, significantly better than the market (3.3%) and the prior-year figure.
Group sales in the first three quarters of 2012 came to some EUR5.8 billion, up 7.4% on sales in the first nine months of 2011. The ongoing price pressure meant that the gross profit margin, at 17.2%, fell short of the 18.8% attained in the prior-year period. EBITDA fell as a result from EUR203 million in the first nine months of 2011 to EUR117 million (a decrease of 42.5%) before restructuring expenses (including restructuring expenses: EUR97 million). Third-quarter EBITDA, at EUR19 million, was likewise down on the prior-year figure of EUR37 million.
Overall, Klöckner & Co consequently generated a net loss of EUR33 million (including restructuring expenses and impairments: net loss of EUR76 million), compared with net income of EUR38 million in the prior-year period. Basic earnings per share amounted to a negative EUR 0.75 compared with a positive EUR0.47 in the prior-year period.
Solid equity base retained
The changes in the statement of financial position are dominated by repayment of the convertible bond due in July. Total assets decreased as a result compared with the 2011 year-end by 7.5% to EUR4,354 million. Net working capital, at EUR1,666 million, was slightly down on the preceding quarter, reflecting the absence of the usual seasonal recovery after the summer (Q2: EUR1,685 million).
The equity ratio was some 41% as of September 30, 2012, slightly up on the level at the end of fiscal 2011. Net financial debt amounted to EUR596 million. With gearing of 37%, net financial debt was still held low relative to shareholders' equity. Liquidity remained strong at EUR656 million despite repayment of the EUR325 million convertible bond on maturity.
Restructuring continuing to plan and further expanded
In light of the ongoing decline in European steel demand and the uncertain outlook, Klöckner & Co has continued as planned and substantially expanded the restructuring program launched in September 2011.
Besides cutting selling, general and administrative expenses, the restructuring measures focus on closing unprofitable branches and discontinuing insufficiently profitable activities. Since the start of the program in September 2011, this has already led to the reduction of 20 locations and in the workforce by some 800. The Group's announced withdrawal from Eastern Europe is well advanced.
The Group-wide restructuring and improvement program has contributed EUR37 million to EBITDA since its launch in September 2011. On a full-year basis, the Group is aiming for a contribution in excess of EUR50 million in the current year. Including the additional measures projected, Klöckner & Co anticipates an annual contribution to EBITDA of around EUR150 million for the Group as a whole from 2014 once all measures have taken full effect. The size of the workforce will be reduced as a result by over 1,800 or 16% and the number of branches from 290 to about 230.
Due to the adverse market environment and the usual seasonal slowdown in business activities at year-end, the Group expects EBITDA before restructuring expenses to remain at around the third-quarter level in the fourth quarter of 2012, with a strong positive cash flow. Gradually increasing contributions from the restructuring program will help counter margin pressure deriving from the current economic environment. Klöckner & Co continues to expect that customers will destock inventories due to the downward price trend. Accordingly, the Group anticipates that fourth-quarter turnover will be down on the preceding quarter.
Overall, Klöckner & Co expects in fiscal 2012 to increase turnover by about 6.5% and sales by about 5% compared with the prior year, with operating income (EBITDA) of EUR130-140 million before restructuring expenses. Expenditure for the expansion of the restructuring program is expected to amount to EUR60 million including pull back from Eastern Europe and the announced restructuring of the French country organization, with at minimum two-thirds of this figure to be incurred during the current year. Due to the restructuring program and the seasonal reduction in working capital toward the year-end, it should be possible to reduce net financial debt below EUR500 million.
Further inquiry note:
Dr. Thilo Theilen
Head of Investor Relations & Corporate Communications
E-Mail: [email protected]
Bert Loomis was a visionary. This general session will highlight how Bert Loomis and people like him inspire us to build great things with small inventions. In their general session at 19th Cloud Expo, Harold Hannon, Architect at IBM Bluemix, and Michael O'Neill, Strategic Business Development at Nvidia, discussed the accelerating pace of AI development and how IBM Cloud and NVIDIA are partnering to bring AI capabilities to "every day," on-demand. They also reviewed two "free infrastructure" pr...
Apr. 26, 2017 03:15 PM EDT Reads: 1,411
The 20th International Cloud Expo has announced that its Call for Papers is open. Cloud Expo, to be held June 6-8, 2017, at the Javits Center in New York City, brings together Cloud Computing, Big Data, Internet of Things, DevOps, Containers, Microservices and WebRTC to one location. With cloud computing driving a higher percentage of enterprise IT budgets every year, it becomes increasingly important to plant your flag in this fast-expanding business opportunity. Submit your speaking proposal ...
Apr. 26, 2017 03:00 PM EDT Reads: 1,148
Cloud promises the agility required by today’s digital businesses. As organizations adopt cloud based infrastructures and services, their IT resources become increasingly dynamic and hybrid in nature. Managing these require modern IT operations and tools. In his session at 20th Cloud Expo, Raj Sundaram, Senior Principal Product Manager at CA Technologies, will discuss how to modernize your IT operations in order to proactively manage your hybrid cloud and IT environments. He will be sharing be...
Apr. 26, 2017 02:45 PM EDT Reads: 413
New competitors, disruptive technologies, and growing expectations are pushing every business to both adopt and deliver new digital services. This ‘Digital Transformation’ demands rapid delivery and continuous iteration of new competitive services via multiple channels, which in turn demands new service delivery techniques – including DevOps. In this power panel at @DevOpsSummit 20th Cloud Expo, moderated by DevOps Conference Co-Chair Andi Mann, panelists will examine how DevOps helps to meet th...
Apr. 26, 2017 02:30 PM EDT Reads: 1,426
NHK, Japan Broadcasting, will feature the upcoming @ThingsExpo Silicon Valley in a special 'Internet of Things' and smart technology documentary that will be filmed on the expo floor between November 3 to 5, 2015, in Santa Clara. NHK is the sole public TV network in Japan equivalent to the BBC in the UK and the largest in Asia with many award-winning science and technology programs. Japanese TV is producing a documentary about IoT and Smart technology and will be covering @ThingsExpo Silicon Val...
Apr. 26, 2017 02:30 PM EDT Reads: 357
SYS-CON Events announced today that CA Technologies has been named "Platinum Sponsor" of SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, New York, and 21st International Cloud Expo, which will take place in November in Silicon Valley, California.
Apr. 26, 2017 01:45 PM EDT Reads: 2,367
Five years ago development was seen as a dead-end career, now it’s anything but – with an explosion in mobile and IoT initiatives increasing the demand for skilled engineers. But apart from having a ready supply of great coders, what constitutes true ‘DevOps Royalty’? It’ll be the ability to craft resilient architectures, supportability, security everywhere across the software lifecycle. In his keynote at @DevOpsSummit at 20th Cloud Expo, Jeffrey Scheaffer, GM and SVP, Continuous Delivery Busine...
Apr. 26, 2017 01:45 PM EDT Reads: 887
While some vendors scramble to create and sell you a fancy solution for monitoring your spanking new Amazon Lambdas, hear how you can do it on the cheap using just built-in Java APIs yourself. By exploiting a little-known fact that Lambdas aren’t exactly single threaded, you can effectively identify hot spots in your serverless code. In his session at 20th Cloud Expo, David Martin, Principal Product Owner at CA Technologies, will give a live demonstration and code walkthrough, showing how to o...
Apr. 26, 2017 01:30 PM EDT Reads: 514
In his keynote at 19th Cloud Expo, Sheng Liang, co-founder and CEO of Rancher Labs, discussed the technological advances and new business opportunities created by the rapid adoption of containers. With the success of Amazon Web Services (AWS) and various open source technologies used to build private clouds, cloud computing has become an essential component of IT strategy. However, users continue to face challenges in implementing clouds, as older technologies evolve and newer ones like Docker c...
Apr. 26, 2017 01:30 PM EDT Reads: 577
SYS-CON Events announced today that Hitachi, the leading provider the Internet of Things and Digital Transformation, will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Hitachi Data Systems, a wholly owned subsidiary of Hitachi, Ltd., offers an integrated portfolio of services and solutions that enable digital transformation through enhanced data management, governance, mobility and analytics. We help globa...
Apr. 26, 2017 01:30 PM EDT Reads: 1,152
Developers want to create better apps faster. Static clouds are giving way to scalable systems, with dynamic resource allocation and application monitoring. You won't hear that chant from users on any picket line, but helping developers to create better apps faster is the mission of Lee Atchison, principal cloud architect and advocate at New Relic Inc., based in San Francisco. His singular job is to understand and drive the industry in the areas of cloud architecture, microservices, scalability ...
Apr. 26, 2017 01:00 PM EDT Reads: 3,524
SYS-CON Events announced today that Juniper Networks (NYSE: JNPR), an industry leader in automated, scalable and secure networks, will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Juniper Networks challenges the status quo with products, solutions and services that transform the economics of networking. The company co-innovates with customers and partners to deliver automated, scalable and secure network...
Apr. 26, 2017 12:45 PM EDT Reads: 4,880
SYS-CON Events announced today that T-Mobile will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. As America's Un-carrier, T-Mobile US, Inc., is redefining the way consumers and businesses buy wireless services through leading product and service innovation. The Company's advanced nationwide 4G LTE network delivers outstanding wireless experiences to 67.4 million customers who are unwilling to compromise on ...
Apr. 26, 2017 12:45 PM EDT Reads: 1,119
DevOps is often described as a combination of technology and culture. Without both, DevOps isn't complete. However, applying the culture to outdated technology is a recipe for disaster; as response times grow and connections between teams are delayed by technology, the culture will die. A Nutanix Enterprise Cloud has many benefits that provide the needed base for a true DevOps paradigm. In his Day 3 Keynote at 20th Cloud Expo, Chris Brown, a Solutions Marketing Manager at Nutanix, will explore t...
Apr. 26, 2017 12:30 PM EDT Reads: 707
DevOps is being widely accepted (if not fully adopted) as essential in enterprise IT. But as Enterprise DevOps gains maturity, expands scope, and increases velocity, the need for data-driven decisions across teams becomes more acute. DevOps teams in any modern business must wrangle the ‘digital exhaust’ from the delivery toolchain, "pervasive" and "cognitive" computing, APIs and services, mobile devices and applications, the Internet of Things, and now even blockchain.
Apr. 26, 2017 12:30 PM EDT Reads: 2,646