DGAP-News: Salzgitter AG / Key word(s): Quarter Results Salzgitter AG: Salzgitter Group off to a strong start to the year 15.05.2018 / 07:30 The issuer is solely responsible for the content of this announcement. --------------------------------------------------------------------------- - Pre-tax profit of EUR 96 million in the first quarter - Convincing performance of the Strip Steel Business Unit; all other segments delivering positive results - Forecast for the full year 2018: - slight increase in sales to above the EUR 9 billion mark, - pre-tax profit of between EUR 250 million and EUR 300 million In an overall tangibly improved market environment that is nevertheless still characterized by global excess capacities and trade policy uncertainties, the Salzgitter Group generated a very gratifying pre-tax profit of EUR 95.9 million in the first quarter of 2018 (Q1 2017: EUR 77.1 million). The strong result of the Strip Steel Business Unit made a special contribution to this result. Moreover, all other business units delivered positive results, also thanks to the rigorously implemented programs within the Group. "Personally, I am very happy about this successful start to the year that marks the 20th anniversary since our public offering," as CEO Prof. Dr.-Ing. Heinz Jörg Fuhrmann stated. "Although numerous financial and political imponderables may still impact the further development of the financial year, we are looking forward with confidence. We have set in place the prerequisites with our optimization measures implemented within the Group since 2012. Although the focus is increasingly shifting toward growth programs, we will be maintaining the pace of our ongoing dynamics." The external sales of the Salzgitter Group remained virtually at the year-earlier level (EUR 2,307.5 million; Q1 2017: EUR 2,353.9 million). The sales of the steel companies rose largely on the back of selling prices, as opposed to international trading that reported a decline. Earnings before taxes were up by almost one quarter to EUR 95.9 million (Q1 2017: EUR 77.1 million). This figure comprises EUR 7.5 million in after-tax contribution from an investment in Europe's leading copper producer Aurubis AG, a company included at equity (Q1 2017: EUR 33.6 million). An after-tax result that stood at EUR 65.2 million (Q1 2017: EUR 48.7 million) brings earnings per share to EUR 1.18 (Q1 2017: EUR 0.87) and return on capital employed to 11.6 % (ROCE; Q1 2017: 10.3 %). An equity ratio of 36.9 % and a net financial position that has almost doubled in comparison with the previous year's period (EUR 320 million; 2017/03/31: EUR 156 million) characterize the comfortable financial basis and sound balance sheet for the Salzgitter Group. Outlook Given the good start to the year, the generally positive business outlook, as well as the planned further effects of the implemented measures and growth promotion measures, Salzgitter AG lifted its earnings forecast at the end of April for the financial year 2018. We now anticipate: - a slight increase in sales to above the EUR 9 billion mark, - a pre-tax profit of between EUR 250 million and EUR 300 million and - a return on capital employed that is stable compared the previous year's figure. The complete report released on the results of the first quarter of 2018 can be viewed at: https://www.salzgitter-ag.com/en/investor-relations/news-and-publications.html The forward-looking statements assume the absence of renewed recessionary development in Europe. Instead, we anticipate an at minimum stable development in our fiercely contested main markets during the current financial year. Moreover, we make explicit reference to the fact that imponderables, including changes in the cost of raw materials, precious metal prices and exchange rates, along with global trade policy measures, may have a considerable impact over the course of the financial year 2018. The resulting fluctuation in the consolidated pre-tax result may be within a considerable range, either to the positive or to the negative. The dimensions of this range become clear if one considers that, with around 12 million tons p.a. of steel products sold by the Strip Steel, Plate / Section Steel, Mannesmann and Trading business units, an average EUR25 change in the margin per ton is sufficient to cause a variation in the annual result of more than EUR 300 million. Moreover, the accuracy of the company's planning is restricted by the volatile cost of raw materials and shorter contractual durations, on the procurement as well as on the sales side. Disclaimer: Some of the statements made in this report possess the character of forecasts or may be interpreted as such. These are made to the best of the Company's knowledge and judgment, and by their nature are subject to the proviso that no unforeseeable deterioration occurs in the economy or in the specific market situation pertaining to the business units' companies, but rather that the underlying bases of plans and outlooks prove to be accurate as expected with regards to their scope and timing. Notwithstanding prevailing statutory provisions and capital market law in particular, the Company accepts no obligation to continuously update any forward-looking statements that are made solely in connection with circumstances prevailing on the day of their publication. Q1 2018 Q1 2017 +/- Crude steel production kt 1,773.8 1,739.6 34.2 External sales EUR 2,307.5 2,353.9 - 46.4 m Strip Steel Business Unit EUR 609.4 548.9 60.5 m Plate / Section Steel Business Unit EUR 286.6 265.5 21.1 m Mannesmann Business Unit EUR 271.0 289.3 - 18.3 m Trading Business Unit EUR 759.8 861.8 - m 101.9 Technology Business Unit EUR 327.7 335.1 - 7.5 m Industrial Participations / Consolidation EUR 52.9 53.4 - 0.5 m EBIT before depreciation and amortization EUR 193.0 184.8 8.2 (EBITDA) m Earnings before interest and taxes (EBIT) EUR 108.5 99.9 8.6 m Earnings before taxes (EBT) EUR 95.9 77.1 18.8 m Strip Steel Business Unit EUR 62.5 53.7 8.8 m Plate / Section Steel Business Unit EUR 9.3 9.4 - 0.1 m Mannesmann Business Unit EUR 1.6 - 3.0 4.6 m Trading Business Unit EUR 13.8 21.6 - 7.9 m Technology Business Unit EUR 11.2 13.1 - 1.9 m Industrial Participations / Consolidation EUR - 2.4 - 17.8 15.3 m Consolidated net income/loss EUR 65.2 48.7 16.5 m Earnings per share - basic EUR 1.18 0.87 0.31 Return on capital employed (ROCE)1) % 11.6 10.3 1.2 Cash flow from operating activities EUR 100.6 - 29.6 130.2 m Investments2) EUR 69.1 55.6 13.5 m Depreciation/amortization2) EUR - 84.6 - 85.0 0.4 m Total assets EUR 8,407.7 8,635.7 - m 228.0 Non-current assets EUR 3,586.2 3,764.3 - m 178.1 Current assets EUR 4,821.5 4,871.4 - 49.8 m of which inventories EUR 2,075.8 1,872.6 203.1 m of which cash and cash equivalents EUR 624.0 686.7 - 62.8 m Equity EUR 3,103.5 2,890.8 212.8 m Liabilities EUR 5,304.2 5,744.9 - m 440.7 Non-current liabilities EUR 3,204.5 3,278.4 - 73.8 m Current liabilities EUR 2,099.6 2,466.5 - m 366.9 of which due to banks3) EUR 468.4 492.6 - 24.1 m Net financial position on the reporting EUR 320.0 155.7 164.4 date4) m Employees Personnel expenses EUR - 422.4 - 414.7 - 7.7 m Core workforce on the reporting date5) empl- 23,333 23,287 46 . Total workforce on the reporting date6) empl- 25,051 25,117 - 66 . Disclosure of financial data in compliance with IFRS 1) Annualized 2) Excluding financial investments 3) Current and non-current bank liabilities 4) Including investments, e.g. securities and structured investments 5) Excl. trainee contracts and excl. non-active age-related part-time work 6) Incl. trainee contracts and incl. non-active age-related part-time work Contact: Markus Heidler Head of Investor Relations Salzgitter AG Eisenhüttenstraße 99 38239 Salzgitter Phone +49 5341 21-6105 Fax +49 5341 21-2570 E-Mail [email protected] --------------------------------------------------------------------------- 15.05.2018 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: Salzgitter AG Eisenhüttenstraße 99 38239 Salzgitter Germany Phone: +49 5341 21-01 Fax: +49 5341 21-2727 E-mail: [email protected] Internet: www.salzgitter-ag.de ISIN: DE0006202005 WKN: 620200 Indices: MDAX Listed: Regulated Market in Frankfurt (Prime Standard), Hanover; Regulated Unofficial Market in Berlin, Dusseldorf, Hamburg, Munich, Stuttgart, Tradegate Exchange End of News DGAP News Service --------------------------------------------------------------------------- 685495 15.05.2018