|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]
ElasticBox, the agile application delivery manager, announced freely available public boxes for the DevOps community. ElasticBox works with enterprises to help them deploy any application to any cloud. Public boxes are curated reference boxes that represent some of the most popular applications and tools for orchestrating deployments at scale. Boxes are an adaptive way to represent reusable infrastructure as components of code. Boxes contain scripts, variables, and metadata to automate proces...
Sep. 5, 2015 04:30 AM EDT Reads: 144
Contrary to mainstream media attention, the multiple possibilities of how consumer IoT will transform our everyday lives aren’t the only angle of this headline-gaining trend. There’s a huge opportunity for “industrial IoT” and “Smart Cities” to impact the world in the same capacity – especially during critical situations. For example, a community water dam that needs to release water can leverage embedded critical communications logic to alert the appropriate individuals, on the right device, as...
Sep. 5, 2015 04:00 AM EDT Reads: 122
To assist customers with legacy Windows Server 2003 that is no longer supported by Microsoft, Racemi has introduced fixed price packages for upgrading and migrating Windows Server 2003 servers to either Windows 2008 R2 or Windows 2012 R2 and the choice of Amazon Web Services (AWS) or SoftLayer cloud. "We're extending a lifeline by upgrading the legacy servers to more modern Windows Server platforms while taking advantage of cloud computing," said James Strayer, vice president of product managem...
Sep. 5, 2015 03:30 AM EDT Reads: 104
To support developers and operations professionals in their push to implement DevOps principles for their infrastructure environments, ProfitBricks, a provider of cloud infrastructure, is adding support for DevOps tools Ansible and Chef. Ansible is a platform for configuring and managing data center infrastructure that combines multi-node software deployment, ad hoc task execution, and configuration management, and is used by DevOps professionals as they use its playbooks functionality to autom...
Sep. 5, 2015 03:00 AM EDT Reads: 156
Manufacturing connected IoT versions of traditional products requires more than multiple deep technology skills. It also requires a shift in mindset, to realize that connected, sensor-enabled “things” act more like services than what we usually think of as products. In his session at @ThingsExpo, David Friedman, CEO and co-founder of Ayla Networks, will discuss how when sensors start generating detailed real-world data about products and how they’re being used, smart manufacturers can use the ...
Sep. 5, 2015 03:00 AM EDT
Skeuomorphism usually means retaining existing design cues in something new that doesn’t actually need them. However, the concept of skeuomorphism can be thought of as relating more broadly to applying existing patterns to new technologies that, in fact, cry out for new approaches. In his session at DevOps Summit, Gordon Haff, Senior Cloud Strategy Marketing and Evangelism Manager at Red Hat, discussed why containers should be paired with new architectural practices such as microservices rathe...
Sep. 5, 2015 02:00 AM EDT Reads: 464
SYS-CON Events announced today that HPM Networks will exhibit at the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. For 20 years, HPM Networks has been integrating technology solutions that solve complex business challenges. HPM Networks has designed solutions for both SMB and enterprise customers throughout the San Francisco Bay Area.
Sep. 5, 2015 01:30 AM EDT Reads: 1,003
Puppet Labs has announced the next major update to its flagship product: Puppet Enterprise 2015.2. This release includes new features providing DevOps teams with clarity, simplicity and additional management capabilities, including an all-new user interface, an interactive graph for visualizing infrastructure code, a new unified agent and broader infrastructure support.
Sep. 5, 2015 01:15 AM EDT Reads: 616
SYS-CON Events announced today that Pythian, a global IT services company specializing in helping companies leverage disruptive technologies to optimize revenue-generating systems, has been named “Bronze Sponsor” of SYS-CON's 17th Cloud Expo, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. Founded in 1997, Pythian is a global IT services company that helps companies compete by adopting disruptive technologies such as cloud, Big Data, advance...
Sep. 5, 2015 01:00 AM EDT Reads: 415
All major researchers estimate there will be tens of billions devices - computers, smartphones, tablets, and sensors - connected to the Internet by 2020. This number will continue to grow at a rapid pace for the next several decades. With major technology companies and startups seriously embracing IoT strategies, now is the perfect time to attend @ThingsExpo, November 3-5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. Learn what is going on, contribute to the discussions, and e...
Sep. 5, 2015 01:00 AM EDT Reads: 261
SYS-CON Events announced today that G2G3 will exhibit at SYS-CON's @DevOpsSummit Silicon Valley, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. Based on a collective appreciation for user experience, design, and technology, G2G3 is uniquely qualified and motivated to redefine how organizations and people engage in an increasingly digital world.
Sep. 4, 2015 11:00 PM EDT Reads: 584
In their Live Hack” presentation at 17th Cloud Expo, Stephen Coty and Paul Fletcher, Chief Security Evangelists at Alert Logic, will provide the audience with a chance to see a live demonstration of the common tools cyber attackers use to attack cloud and traditional IT systems. This “Live Hack” uses open source attack tools that are free and available for download by anybody. Attendees will learn where to find and how to operate these tools for the purpose of testing their own IT infrastructu...
Sep. 4, 2015 09:30 PM EDT Reads: 545
DevOps Summit, taking place Nov 3-5, 2015, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with 17th Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world. The widespread success of cloud computing is driving the DevOps revolution in enterprise IT. Now as never before, development teams must communicate and collaborate in a dynamic, 24/7/365 environment. There is no time to wait for long development...
Sep. 4, 2015 07:00 PM EDT Reads: 1,670
Too often with compelling new technologies market participants become overly enamored with that attractiveness of the technology and neglect underlying business drivers. This tendency, what some call the “newest shiny object syndrome,” is understandable given that virtually all of us are heavily engaged in technology. But it is also mistaken. Without concrete business cases driving its deployment, IoT, like many other technologies before it, will fade into obscurity.
Sep. 4, 2015 06:45 PM EDT Reads: 458
Whether you like it or not, DevOps is on track for a remarkable alliance with security. The SEC didn’t approve the merger. And your boss hasn’t heard anything about it. Yet, this unruly triumvirate will soon dominate and deliver DevSecOps faster, cheaper, better, and on an unprecedented scale. In his session at DevOps Summit, Frank Bunger, VP of Customer Success at ScriptRock, will discuss how this cathartic moment will propel the DevOps movement from such stuff as dreams are made on to a prac...
Sep. 4, 2015 06:00 PM EDT Reads: 285