RHI Magnesita

EANS-Adhoc: RHI AG
Results of the third quarter 2014

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Financial Figures/Balance Sheet
05.11.2014


In the third quarter of 2014 the RHI Group's revenues declined by 4.9% compared
with the second quarter of 2014 and amounted to EUR 415.6 million. This is
primarily due to a lack of new construction business in the Industrial Division
and postponements of planned installations to the fourth quarter of 2014.
 
As a result of weaker business in the Industrial Division, the operating result
dropped from EUR 37.7 million in the preceding quarter to EUR 28.3 million in
the third quarter of 2014. Consequently, the operating result margin decreased
from 8.6% to 6.8% in the past quarter.
 
EBIT amounted to EUR 25.3 million in the third quarter of 2014 and includes
restructuring costs of EUR 3.0 million, which resulted from the closure of the
plant in Duisburg, Germany. Contrary to the original plans regarding the
winding-up of the site, no appropriate utilization options have arisen for the
use of existing plant and equipment.
 
9M/2014 - comparative period 2013 includes net income from termination of US
Chapter 11 proceedings

In the first nine months of the year 2014, revenues of the RHI Group were down
3.3% on the comparative period of 2013 and amounted to EUR 1,254.7 million.
While revenues of the Steel Division decreased slightly by 0.4%, the Industrial
Division recorded a drop in revenues of 9.9% year-on-year due to the weak
development of new construction projects. Especially the contribution to
revenues of the nonferrous metals business unit dropped sharply as a result of
lower metal prices and that of the glass business unit due to low investment
activities in the relevant customer industries.
 
The operating result of the RHI Group in the first nine months of this year
totaled EUR 100.1 million and was thus 8.0% lower than in the comparative period
of 2013, at EUR 108.8 million. While the Steel Division benefited from an
improved product mix of higher-grade products and better utilization of fixed
costs as a result of the closure of the site in Duisburg, Germany, at the
beginning of the financial year, the operating result of the Industrial Division
decreased as a result of low construction activities and the related lower
capacity utilization in the production plants. The operating result margin
declined from 8.4% in the first nine months of the year 2013 to 8.0% in the
current financial year.
 
EBIT amounted to EUR 97.4 million in the first nine months of the current year
and includes restructuring costs amounting to EUR 3.5 million, which result from
the closure of the plant in Duisburg, Germany, and income from the reversal of
provisions of EUR 0.8 million due to a reassessment of the scope of obligations
in the context of the termination of the US Chapter 11 proceedings in the
previous year. In the comparative period of 2013, EBIT included among other
things restructuring provisions amounting to EUR 19.0 million, which were formed
for the announced closure of the site in Duisburg, Germany, and net income of
EUR 76.2 million from the termination of the US Chapter 11 proceedings.
 
At September 30, 2014, equity amounted to EUR 506.1 million, compared with EUR
485.5 million at December 31, 2013. The equity ratio consequently rose from
28.2% at the end of the financial year 2013 to 28.5% at September 30, 2014. Cash
and cash equivalents decreased from EUR 112.4 million to EUR 90.5 million, which
was among other things due to the dividend payment of EUR 29.9 million and the
increase in working capital compared with December 31, 2013. Payment from the
Schuldscheindarlehen of EUR 170 million was received in early October. Net debt
rose from EUR 422.9 million at the beginning of the year to EUR 451.2 million.
 
Net cash flow from operating activities totaled EUR 40.1 million in the first
nine months of 2014, after EUR 117.0 million in the comparative period of 2013.
This is primarily attributable to a strong increase in working capital in the
course of the year and payments of roughly EUR 12 million made in the context of
the social plan related to the closure of the plant in Duisburg, Germany.
 
Outlook

Provided that the macroeconomic environment and exchange rates remain stable,
RHI expects similar revenues in the fourth quarter of 2014 as in the fourth
quarter of 2013. In the Industrial Division, the fourth quarter should bring the
highest revenues of the current financial year.
 
For the full year 2014, RHI expects revenues slightly below and an operating
result slightly above the level of the previous year. Due to a decrease in
production volume, RHI is currently evaluating the closure of a site in Europe
as part of the plant concept. As a result, the reported EBIT margin may decline
by 0.5 percentage points in the full year 2014 due to possible restructuring
costs arising in this context.
 

in EUR million             9M/2014 9M/2013 Delta     Q3/2014 Q2/2014 Delta
Revenues                   1,254.7 1,298.1 (3.3)%    415.6   436.8   (4.9)%
EBITDA                     148.1   218.3   (32.2)%   43.1    54.8    (21.4)%
EBITDA margin              11.8%   16.8%   (5.0)pp   10.4%   12.5%   (2.1)pp
Operating result 1)        100.1   108.8   (8.0)%    28.3    37.7    (24.9)%
Operating result margin    8.0%    8.4%    (0.4)pp   6.8%    8.6%    (1.8)pp
EBIT                       97.4    164.1   (40.6)%   25.3    38.5    (34.3)%
EBIT margin                7.8%    12.6%   (4.8)pp   6.1%    8.8%    (2.7)pp
Result before income taxes 80.7    141.4   (42.9)%   18.1    33.8    (46.4)%
Result from continued
operations                 51.6    101.2   (49.0)%   9.0     22.8    (60.5)%
                                                                          
1) EBIT before impairment and restructuring expenses and result from Chapter 11
proceedings
 
 
The report for the third quarter of 2014 is available for download on the RHI
website: www.rhi-ag.com/ Investor Relations / Financial Reports


Further inquiry note:
RHI AG  
Investor Relations
Mag. Simon Kuchelbacher
Tel: +43-1-50213-6676
Email: simon.kuchelbacher@rhi-ag.com

end of announcement                               euro adhoc 
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issuer:      RHI AG
             Wienerbergstrasse 9
             A-1100 Wien
phone:       +43 (0)50213-6676
FAX:         +43 (0)50213-6130
mail:     rhi@rhi-ag.com
WWW:      http://www.rhi-ag.com
sector:      Refractories
ISIN:        AT0000676903
indexes:     ATX Prime, ATX
stockmarkets: official market: Wien 
language:   English
 

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