DGAP-News: Befesa S.A. / Key word(s): Final Results Befesa focuses on organic growth after record year 2017 15.03.2018 / 07:30 The issuer is solely responsible for the content of this announcement. --------------------------------------------------------------------------- Befesa focuses on organic growth after record year 2017 * 2017 results: revenue of EUR 725mn (+18%), adj. EBITDA [1] of EUR 172mn (+30%, 24% margin), adj. EBIT1 of EUR 144mn (+39%, 20% margin) * Throughput volumes at new record levels across both core segments * Resilient, low-risk growth through continued strong cash flow, reduced leverage and extended hedging program * Earnings growth to continue in 2018: expected single-digit growth as capacity remains stable, Turkey taken offline in Q4 2018 to expand capacity Luxembourg, 15 March 2018 - Befesa S.A. ("Befesa"), the European market leader for steel dust and aluminium salt slags recycling services, expects to grow earnings in 2018 at single-digits following the record 2017 performance. In the financial year 2017, Befesa significantly grew its revenue by 18% to EUR 725mn. Adjusted EBITDA developed in line with Befesa's IPO-guidance, growing 30% to EUR 172mn, while adjusted EBIT increased even more significantly to EUR 144mn, up 39% compared to the previous year. Margins were at 24% and 20% respectively. Befesa finished 2017 with a Net Income of EUR 49mn (prior year: Net Loss EUR 53mn). Javier Molina, CEO of Befesa, said: "After concluding 2017 with record results across our segments, Befesa is looking forward to continued success in 2018. As we implement our next set of organic growth initiatives, including the capacity increase in our plant in Turkey during the fourth quarter, we will continue our company's successful development in 2018 and beyond." In 2017, Befesa delivered a strong net Cash Flow from Operating Activities [2] of EUR 91mn (prior year: EUR 56mn), with new record volumes in both core segments. The positive growth momentum is expected to continue in 2018. Befesa furthermore entered into a new financing agreement which became effective on 7 December 2017, replacing the outstanding PIK, HY Bond and other financial facilities. Together with strong cash generation, the company improved its Net Debt3 / adjusted EBITDA leverage to x2.4 at the end of 2017 (versus x3.5 at year-end 2016). The company also expanded its disciplined hedging program, extending zinc hedges to year-end 2020. In 2017, Befesa hedged 73kt of zinc (59% of zinc equivalent output volume) at EUR 1,876 per ton and sold an additional 51kt (41% of zinc equivalent output volume) at an average market price of EUR 2,572 per ton. This resulted in a blended average zinc price per ton of EUR 2,160. For 2018, Befesa has extended its zinc hedges to 92kt (approximately 70% of expected total zinc equivalent output volume) at EUR 2,051 per ton. Using the 2017 average LME market price of EUR 2,572 for 2018 for the remaining unhedged approximately 30% volume, the blended average 2018 zinc price would be EUR 2,207 per ton. For 2019 and 2020, Befesa has hedged 92kt each year at EUR 2,306 and EUR 2,245 per ton respectively. Befesa's strategy for growth initiatives in 2018 includes increasing capacity in the Steel Dust Services segment in Turkey and construction of a washing plant for the Waelz oxide in South Korea. In the Aluminium Salt Slags Services segment, Befesa is upgrading the furnaces at its Barcelona and Bilbao plants as well as expanding capacity at its Hanover plant. NOTE The full annual report and earnings presentation for analysts and investors is available on Befesa's Investor Relations website ( http://www.befesa.com/web/en/informacion_inversores/informes-presentaciones/index.html). Befesa will hold its Annual General Meeting on 26 April 2018 in Luxembourg. First quarter results will be available on 24 May 2018. ___ [1] Adjusted EBITDA and adjusted EBIT excludes one-off effects including IPO and other one-time related non-recurring expenses [2] Note Total Free Cash Flow measured as Adjusted EBITDA +/- Change in Working Capital - Maintenance CapEx - Taxes is approximately EUR133mn for the full year 2017. 3 Net debt as of December 31, 2017 amounted to approximately EUR 406mn About Befesa Befesa is a leading international provider of critical environmental regulated services to the steel and aluminium industries with facilities located in Germany, Spain, Sweden, France, the UK, Turkey and South Korea. Through its two business units, Steel Dust and Aluminium Salt Slags recycling services, Befesa manages and recycles more than 1,300kt of residues annually, with a production of more than 600kt of new materials, which Befesa reintroduces in the market, reducing the consumption of natural resources. Further information can be found on the company's website: www.befesa.com Investor Relations Rafael Pérez Email: [email protected] Befesa Management Services GmbH Balcke-Dürr-Allee 1 40882 Ratingen Deutschland (Germany) Media Relations Maximilian Karpf Email: [email protected] Mobile: +44 7970 716 953 --------------------------------------------------------------------------- 15.03.2018 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG. The issuer is solely responsible for the content of this announcement. The DGAP Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Archive at www.dgap.de --------------------------------------------------------------------------- Language: English Company: Befesa S.A. 46 Boulevard Grande-Duchesse Charlotte 1330 Luxembourg Grand Duchy of Luxembourg E-mail: [email protected] Internet: www.befesa.com ISIN: LU1704650164 WKN: A2H5Z1 Listed: Regulated Market in Frankfurt (Prime Standard); Regulated Unofficial Market in Berlin, Dusseldorf, Hamburg, Munich, Stuttgart, Tradegate Exchange; London End of News DGAP News Service --------------------------------------------------------------------------- 664303 15.03.2018