Mutares publishes Half-Year Report 2019: Promisingly expanded portfolio

• Group sales of EUR 443.2 million, full effect of acquisitions expected for second half of year
• Group EBITDA at EUR 67.1 million tripled compared to the same period in 2018
• Adjusted EBITDA at group level at EUR 0.0 million due to numerous acquisitions
• Donges Group and Elastomer Group investments show pleasing operating progress
• Further ambitious expansion of portfolio targeted for 2019

Munich, August 8, 2019 - Mutares (ISIN: DE000A2NB650) today published its report for the first half of fiscal 2019. Group sales in the reporting period amounted to EUR 443.2 million and were thus around 5% lower than in the first six months of the previous year (first half of 2018: EUR 467.0 million). Deconsolidation and transaction effects contributed to this development. The five acquisitions of the current fiscal year completed as of June 30, 2019, were included pro rata temporis and therefore could not yet fully contribute to consolidated sales and earnings. As expected, the three new platform acquisitions Plati Group, TréfilUnion and keeeper Group in particular will not show their full impact on sales and earnings until the second half of 2019.

Reported Group EBITDA amounted to EUR 67.1 million, tripling EBITDA for the first half of 2018 (EUR 21.6 million). The main driver of the result is the transaction-related income from "bargain purchases" in connection with the five completed acquisitions for the portfolio in the first half of 2019 totaling EUR 70.8 million, which strengthened the Goods & Services segment in particular. Cash and cash equivalents of the Mutares Group amounted to EUR 80.9 million as of June 30, 2019 (December 31, 2018: EUR 108.1 million).

Adjusted EBITDA

Adjusted EBITDA is an EBITDA management indicator adjusted for non-recurring effects with the aim of transparently presenting the operating performance of the portfolio companies. The calculation is based on reported Group EBITDA, adjusted for transaction-related income from bargain purchases, restructuring and other non-recurring expenses, and deconsolidation effects.

In the first half of 2019, Mutares' investments achieved a consolidated adjusted EBITDA of EUR 0.0 million (first half of 2018: EUR 9.3 million), mainly due to the positive result of the Automotive & Mobility segment of EUR 11.0 million (previous year: EUR 13.9 million). The acquisitions made in the last twelve months, namely the Gemini Group and the strategic acquisitions of the Donges Group with FTD and Normek as well as the new platform investments Plati Group and TréfilUnion, had a counteracting effect with a total negative impact of around EUR 6.0 million.
 

Significant operational progress and already seven transactions to date
The investments Donges Group, Elastomer Group and Balcke-Dürr Group made pleasing operational progress in the first six months of 2019. In particular, Balcke-Dürr Group recorded a very good performance in the area of conventional energy. The restructuring of the Donges Group's add-on acquisitions is currently proceeding according to plan. In addition, integration on the sales side has got off to a good start. After a disappointing year in 2018, the progress made by the Elastomer Group in adjusting its cost structure and production processes shows very positive effects.

On the transaction side, the focus was on seven acquisitions, five of which were successfully completed in the first half of 2019. Mutares further expanded its portfolio and in particular the Automotive & Mobility and Goods & Services segments, each with two new platforms. In addition, the Donges Group continued its buy-and-build strategy, which will result in annualized Group sales of over EUR 400 million.

"For the current fiscal year 2019, we have already exceeded our ambitious transaction targets for this year with seven acquisitions to date. In view of the challenging but also extremely attractive market environment in some areas, we are aiming for further transactions. We are optimistic that we will continue to shape our portfolio in a targeted and value-creating manner in the second half of the year," says Robin Laik, CEO, confident of the further course of business in 2019.

Net asset value of the portfolio
On the basis of developments and market conditions in the first half of the year, the net asset values (NAV) for the portfolio segments were updated as of 30 June 2019. The NAV is calculated as the sum of the segment valuations (assets less the market value of debt plus net financial resources in Mutares Holding, excluding intermediate holding companies). For the calculation of the NAV, the sum-of-the-parts value of the individual companies continues to be taken into account, i.e. transaction activity, turnaround expertise and the brand strength of the Mutares are not included in the following calculation:
 

Comments on the NAV in H1/2019:

- Automotive segment: STS Group AG was valued as of June 30, 2019, on the basis of the stock market price (XETRA) and the share of total capital held by Mutares AG (65%)

- Engineering & Technology: Significant upgrading of Donges Group on the basis of the successfully completed restructuring at Kalzip and the repositioning of the Normek Group. The Ruukki Building Systems transaction not yet completed as of the reporting date and not taken into account

- Platform investments that have been in the portfolio for less than six months as of the reporting date are recognized at cost in NAV

Conference call today at 14:00 (CEST)

A conference call in English will be held today at 14:00 (CEST) for analysts, investors and press representatives. Registrations can be made by sending an e-mail to [email protected].

Company profile of Mutares SE & Co. KGaA

Mutares SE & Co. KGaA, Munich (www.mutares.com), acquires medium-sized companies and parts of the group based in Europe, which are being sold as part of a repositioning and have significant operational improvement potential. Mutares actively supports and develops its portfolio companies with its own investment and expert teams and by acquiring strategic add-ons. The aim is to achieve a significant increase in value with a focus on sustainable growth of the portfolio company. In fiscal year 2018, Mutares' investments generated consolidated sales of EUR 865 million and employed more than 4,700 people worldwide. Mutares SE & Co. KGaA shares are traded on the Frankfurt Stock Exchange under the symbol "MUX" (ISIN: DE000A2NB650).

Please contact us for further information:

Mutares SE & Co. KGaA
Corinna Lumpp
Manager Investor Relations & Strategy
Phone +49 89 9292 7760
Email: [email protected]
www.mutares.com

Contact Press
CROSS ALLIANCE communication GmbH
Susan Hoffmeister
Phone +49 89 1250 90330
Email: [email protected]
www.crossalliance.de