Insider information pursuant to Article 17 of the Market Abuse Regulation [MAR]

H&R GmbH & Co. KGaA: Preliminary business figures for the first half of 2023

• Sales reach EUR 699.6 million (comparable half-year 2022: EUR 805.8 million)
• EBITDA of EUR 39.4 million behind previous year's level (H1-2022 EUR 72.8 million)
• Earnings stabilization and recovery in the second quarter of 2023
• Increase of free cash flow from EUR -28.7 million (H1-2022) to EUR 24.7 million in H1-2023

Salzbergen, July 21, 2023. H&R GmbH & Co. KGaA (in short: H&R KGaA; ISIN DE000A2E4T77) reports more stable and recovered key financial figures overall at the end of the first half of 2023 than at the beginning of the year. According to preliminary calculations, consolidated operating profit (EBITDA - consolidated earnings before income taxes, other financial income and expenses, and amortization, depreciation, and impairment losses and reversals of impairment losses on intangible assets and property, plant, and equipment) amounted to EUR 25.0 million in the second quarter, significantly outperforming the weak first quarter of 2023. By contrast, the very good figure of EUR 47.6 million achieved in the comparative prior-year quarter of 2022 was not matched. Earnings at the other levels also stabilized since the beginning of the year, but fell short of the Q2-2022 earnings figures: EBIT closed at EUR 10.6 million after last year's EUR 34.2 million. Earnings before taxes (EBT) in Q2-2023 were EUR 7.9 million (Q2-2022: EUR 32.6 million), and the company closed with EUR 4.7 million in consolidated earnings attributable to shareholders (Q2-2022: EUR 21.6 million). Thus, at the end of the half-year, the company succeeded in offsetting the negative consolidated net income of the first quarter and converting it into earnings per share of EUR 0.13. Sales in the second quarter of the current fiscal year declined to EUR 350.5 million (Q2-2022: EUR 444.0 million) due to both raw material prices and lower demand.

Looking at the first half of 2023 as a whole, the company provisionally achieved an operating result (EBITDA) of EUR 39.4 million (H1-2022: EUR 72.8 million). With slightly higher depreciation and amortization compared to the previous year, the results also fell short of the previous year in the 6-month view: EBIT amounted to EUR 11.1 million (H1-2022: EUR 46.2 million). Earnings before taxes (EBT) were also weaker at EUR 5.7 million (H1-2022: EUR 42.9 million). Consolidated earnings attributable to shareholders closed at EUR 3.7 million (H1-2022: EUR 29.7 million). As a result of the negative contribution from the first quarter of 2023, H&R KGaA generated earnings per share of EUR 0.10 for the half-year. At the end of the half-year, sales revenues amounted to EUR 699.6 million (H1-2022: EUR 805.8 million).

The main contribution to the improved result came from the ChemPharm Refining segment. Besides a fully comprehensive cost management, this was due to effects from the so-called electricity price brake, which were retroactively included in the second quarter. This relief will also have a positive impact on earnings in the further course of the year, albeit to a lesser extent. Overall, the activities of our two specialty production sites recorded lower operating results this year, at EUR 16.7 million in Q2 and EUR 22.4 million in H1 (Q2-2022: EUR 35.9 million; H1-2022: EUR 54.9 million). Sales revenues in the first half of the year were down year-on-year at EUR 433.2 million (H1-2022: EUR 534.3 million), due to both raw material prices and volumes. The ChemPharm Sales segment decreased to an EBITDA of EUR 7.4 million in Q2-2023 (Q2-2022: EUR 12.1 million). The segment also reported reduced earnings of EUR 13.8 million for the 6-month period (H1-2022: EUR 18.7 million). Sales revenues in the segment remained largely stable, reaching EUR 251.1 million for the first half of the year (H1 2022: EUR 259.9 million). The Plastics segment generated an operating result of EUR 3.0 million, an improvement of EUR 1.6 million compared to the first half of the previous year, and an improvement of EUR 1.1 million in a quarterly comparison. An operating result of EUR 1.7 million was achieved in the second quarter. At EUR 13.1 million and EUR 26.3 million, respectively, sales also increased strongly compared to the previous year's figures (Q2-2022: EUR 10.5 million; H1-2022: EUR 21.1 million).

The operating cash flow amounted to EUR 8.3 million in Q2-2023 (Q2-2022: EUR 3.5 million), while free cash flow was EUR -7.1 million (Q2-2022: EUR -10.3 million). At the half-year mark, operating cash flow was EUR 56.8 million (H1-2022: EUR -1.3 million) and free cash flow was EUR 24.7 million (H1-2022: EUR -28.7 million).

Compared to December 31, 2022, total assets decreased from EUR 962.1 million to EUR 932.4 million. Equity decreased from EUR 471.2 million to EUR 453.0 million in the same period. As of June 30, 2023, the equity ratio of the Company is 48.6% (December 31, 2022: 49.0%).

At the end of the first half of the year, the company's key figures were significantly more stable than at the beginning of the year. Currently, an operating result in the middle range of the full-year expectation (EUR 70.0 million to EUR 90.0 million) seems achievable. At the same time, the current market situation (economic developments; availability of raw materials; price development electricity/energy; customer demand; competitive situation) does not allow a more precise assessment. The company will therefore provide more precise guidance in due course. The final financial figures and further information on business development to date in 2023 will be published as planned in the half-year report on August 15, 2023.

Contact:
H&R GmbH & Co. KGaA, Head of Investor Relations / Communication, Ties Kaiser
Neuenkirchener Straße 8, 48499 Salzbergen
Phone.: +49 40 43218-321, Fax: +49 40 43218-390
Mail: [email protected]
www.hur.com

H&R GmbH & Co. KGaA:

H&R KGaA is a specialty-chemicals company listed on the Frankfurt Stock Exchange's Prime Standard segment. It develops and manufactures fossil-, biomass-, synthetic- and recycle-based hydrocarbon chemical and pharmaceutical specialty products and produces high-precision plastic parts.

Forward-looking statements and forecasts:

This insider information pursuant to Article 17 of the Market Abuse Regulation [MAR] contains forward-looking statements. The statements are based on the current estimates and forecasts by the Management Team and the information available to it at this time. These forward-looking statements do not provide any warranty for the future developments and results contained therein. The future developments and results are dependent on a number of factors; they entail various risks and contingencies and are based on assumptions which could prove to be incorrect. We do not assume any responsibility for updating the forward-looking statements contained in this insider information pursuant to Article 17 of the MAR.