In the context of preparations for the new five-year plan, a guidance adjustment for CFM and the Group as well as an impairment charge for CFM become necessary and a first outlook for 2020 becomes apparent


Wiesbaden, October 25, 2019; In the context of preparations for the new five-year plan of SGL Carbon SE, a review of the current guidance for 2019 was undertaken.

While the preliminary results for the first nine months 2019 remain, overall, within the scope of the full year outlook outlined in the ad-hoc notification of August 14, 2019 (preliminary 9M/2019 recurring EBIT¹: Group: approx. EUR54 million, CFM: approx. minus EUR2 million, GMS: approx. EUR71 million, Corporate: approx. minus EUR15 million), continued weakness is becoming apparent for the final quarter 2019 in the reporting segment Composites - Fibers & Materials (CFM). This is due to the further weakening in the market segment Textile Fibers as well as the deteriorated economic environment in the market segment Industrial Applications.

We therefore now expect for the full year 2019 a recurring EBIT in the reporting segment CFM in a negative mid to high single digit million EUR amount (previous guidance: positive mid-single digit million EUR amount). This results in a Group recurring EBIT for the full year 2019 in the magnitude of EUR45 to 50 million (previous guidance: approx. EUR55 million).

The earnings deterioration at CFM triggers an impairment testing. Based on the preliminary status of the new five-year plan, a non-cash impairment charge of EUR70 to 80 million is becoming apparent in CFM mainly due to the lower starting point in 2019 as well as the ongoing weakness in the market segments Textile Fibers and Industrial Applications. This impairment charge will be recorded in the third quarter 2019. In recent years acquired assets of the former joint ventures with BMW and Benteler are not affected by this impairment.

Due to the earnings deterioration in CFM and thus also at the Group level, we also anticipate a write-down in deferred tax assets in the amount of up to EUR10 million, which will also be recorded in the third quarter 2019.

Mainly due to the above-mentioned impairment charge of EUR70 to 80 Mio. EUR, consolidated net results in the fiscal year 2019 are expected to reach approximately minus EUR100 million (previous guidance: consolidated net results to reach a high single digit million loss).

An initial outlook for 2020 is also becoming apparent based on the current status of the new five-year plan: Group sales is expected slightly below the 2019 level (which is anticipated between EUR1.05 and EUR1.1 billion). Group recurring EBIT is likely to be 10 to 15 percent below the expected 2019 level. As already outlined in the ad-hoc notification of August 14, 2019, we are planning to publish further details on this and the new Group plan in January 2020 at the latest.

The interim report on the first nine months will be published on November 5, 2019, as planned.

¹The use of KPIs in this notification is aligned to the annual report 2018 which is available under www.sglcarbon.com. There were no changes to the scope of consolidation or to valuation methods compared to the previous guidance.