08.05.2014
Klöckner & Co. SE DE000KC01000
DGAP-News: KLÖCKNER & CO SE WITH POSITIVE NET INCOME IN FIRST QUARTER OF 2014
DGAP-News: Klöckner & Co. SE / Key word(s): Quarter Results
KLÖCKNER & CO SE WITH POSITIVE NET INCOME IN FIRST QUARTER OF 2014
08.05.2014 / 06:59
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- Turnover of 1.6 million tons at prior-year level despite reduction of
low-margin business
- Sales down by 3.2% to around EUR1.6 billion due to lower price level in
Europe and weaker US dollar
- Gross profit margin up from 18.6% to 19.2% through focus on
higher-margin business
- Operating income (EBITDA) improved from EUR29 million to EUR45 million
and EBIT from EUR2 million to EUR23 million
- Positive net income of EUR3 million, compared with net loss of EUR16
million in prior-year period
- Leverage reduced from 4.1x to 2.4x EBITDA
- Projected further increase in EBITDA to between EUR50 million and EUR60
million in the second quarter
- Positive net income and resumption of dividends targeted for fiscal
year 2014
Figures relate to first three months of 2014 relative to first three months
of prior year.
Duisburg, Germany, May 8, 2014 - At 1.6 million tons turnover in the first
three months of 2014 was on prior-year level despite restructuring-related
cutbacks in low-margin business. Sales nonetheless went down by 3.2% to
EUR1.6 billion due to the lower price level in Europe and the weaker US
dollar. Due to an improvement in the gross profit margin from 18.6% to
19.2% as a result of focusing on higher-margin business meant that gross
profit, at EUR302 million (Q1 2013: EUR303 million), was broadly level with
the prior year despite the lower sales. Operating income (EBITDA) came to
EUR45 million, up from EUR29 million in the prior-year period. The main
driver of the improvement in earnings was the EUR17 million reduction in
costs delivered by the restructuring. Lower acquisition-related
amortization made for an even stronger increase in earnings before interest
and taxes (EBIT), from EUR2 million to EUR23 million. Net income, too, was
significantly improved and back in positive figures at EUR3 million,
compared with a net loss of EUR16 million in the prior-year period. Basic
earnings per share went up accordingly from a negative EUR0.16 in the
prior-year period to a positive EUR0.03.
Gisbert Rühl, CEO of Klöckner & Co SE: "By successfully completing our
restructuring measures, we have regained profitability through our own
efforts. Now we are working full steam to further boost earnings by
consequently implementing our KCO WIN optimization program."
First-quarter earnings higher in both segments
Favored by the mild winter, the Europe segment increased turnover by 2.8%
compared with the first three months of 2013. Mainly through completion of
the restructuring measures, operating income went up from EUR14 million to
EUR26 million.
Due to the long winter in the USA, the site consolidation and the reduction
in low-margin business, turnover in the Americas segment during the first
three months declined by 5.3% compared with a year earlier. Thanks to an
improvement in the gross profit margin from 17.0% to 18.0%, it was
nonetheless possible to improve segmental EBITDA by EUR3 million to EUR24
million despite the lower turnover in the USA.
Initial measures implemented in KCO WIN optimization program
Implementation of the KCO WIN optimization program continues fully to plan.
Focal points include efficiency improvements in procurement and sales.
Successful implementation of initial measures will make a noticeable
contribution toward the targeted earnings boost as early as the second
quarter. The program is slated to contribute a total of EUR20 million to
EBITDA in the current year before delivering its full EUR50 million impact
on operating income in 2015.
Ambitious target set for digitalization of supply chain
As part of its "Klöckner & Co 2020" growth strategy, Klöckner & Co expands
the sale of steel and other metals via the internet. Following successful
initiated installation of the new Klöckner webshop in the Netherlands, the
roll-out across all remaining country organizations (starting with Germany)
is due for completion by the end of next year.
Gisbert Rühl: "We want to pioneer this channel in our industry and have set
ourselves the ambitious target of generating half of all sales online in
five years."
Outlook
Klöckner & Co expects that European steel demand will rise by about 2% in
the current year. Demand growth is anticipated most of all from machinery
and mechanical engineering as well as from the automotive industry. In the
USA, the long drawn-out winter at first put the brakes on demand recovery
in the first quarter. Despite this, the still very robust state of the
automotive industry and the anticipated upturn in commercial construction
mean that growth of 3% to 4% should be attained for the year as a whole.
Klöckner & Co SE expects to see a seasonal increase in turnover in the
second quarter. As a result, operating income (EBITDA) is projected to
further improve to between EUR50 million and EUR60 million. The increasing
positive impact from the KCO WIN optimization program coupled with the
first-time consolidation of the Swiss acquisition will also contribute to
the forecast increase in earnings.
The prior-year figure of EUR150 million for EBITDA before restructuring
expenses is expected to be clearly surpassed in the year as a whole. The
main drivers of the anticipated improvement in earnings will be the
incremental contributions to EBITDA from the completed KCO 6.0
restructuring program, the KCO WIN optimization program and the acquisition
in Switzerland.
Gisbert Rühl: "With completion of our restructuring program and the
optimization measures now underway, we have attained turnaround.
Accordingly, we also aim to achieve positive net income on a full-year
basis and to pay our shareholders a dividend from it."
About Klöckner & Co:
Klöckner & Co is the largest producer-independent distributor of steel and
metal products and one of the leading steel service center companies in the
European and American markets combined. The core business of Klöckner & Co
is the warehousing and distribution of steel and non-ferrous metals as well
as the operation of steel service centers. Based on the Group's
distribution and service network, more than 146,000 customers are supplied
through around 220 locations in 15 countries. Currently, Klöckner & Co
employs around 9,500 employees. The Group had sales of around EUR6.4
billion in fiscal year 2013.
The shares of Klöckner & Co SE are admitted to trading on the regulated
market segment (Regulierter Markt) of the Frankfurt Stock Exchange
(Frankfurter Wertpapierbörse) with further post-admission obligations
(Prime Standard). Klöckner & Co shares are listed in the MDAX(R)-Index of
Deutsche Börse.
ISIN: DE000KC01000; WKN: KC0100; Common Code: 025808576.
Contact person:
Christian Pokropp - Press Spokesperson
Head of Investor Relations & Corporate Communications
Phone: +49 (0) 203-307-2050
Fax: +49 (0) 203-307-5025
Email: [email protected]
End of Corporate News
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08.05.2014 Dissemination of a Corporate News, transmitted by DGAP - a
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Language: English
Company: Klöckner & Co. SE
Am Silberpalais 1
47057 Duisburg
Germany
Phone: +49 (0)203 / 307-0
Fax: +49 (0)203 / 307-5000
E-mail: [email protected]
Internet: www.kloeckner.com
ISIN: DE000KC01000
WKN: KC0100
Listed: Regulierter Markt in Frankfurt (Prime Standard);
Freiverkehr in Berlin, Düsseldorf, Hamburg, Hannover,
München, Stuttgart
End of News DGAP News-Service
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