SALZGITTER AG: 2008 off to a great start with new record sales and excellent earnings in the first quarter
Salzgitter (euro adhoc) -
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finances/Interim report
In the first quarter of 2008, the Salzgitter Group benefited from the marked upswing in demand in the European steel market, the expansion of business activities in the precision tubes segment, as well as from the contribution of the new Technology Division.
Consolidated external sales rose 22 % to EUR 2.90 billion (first quarter of 2007: EUR 2.38 billion). Klöckner-Werke AG, acquired at the start of the second half-year of 2007 and integrated into the new Technology Division, and other companies in the Tubes Division contributed EUR 314.2 million to this result.
Pre-tax profit of EUR 291.9 million remained at an excellent level (first quarter of 2007: EUR 325.4 million) thanks to very good results delivered especially by the Steel, Tubes and Trading divisions. What makes this outcome even more remarkable is that not only higher current expenses for raw materials and energy, but also EUR 49.1 million in additional materials expenses were considered in view of the further price increases that largely became effective from January 1, 2008. Due to a reduction in the corporate tax rate, the Group´s after-tax profit, which stood at EUR 194.9 million, almost attained the previous year´s level (first quarter of 2007: EUR 196.6 million). Earnings per share posted EUR 3.40 (first quarter of 2007: EUR 3.41). Return on capital employed (ROCE) from industrial business reached a remarkable 37.9 % in the first three months of 2008; including income from the investment of funds of more than EUR 2 billion, ROCE came to 22.4 % (first quarter of 2007: 30.8 %).
Sales by Division (EUR million):
Q1 2008 (Q1 2007) Steel 1,110.4 (1,007.4) Trading 1,307.5 (1,267.4) Tubes 726.5 (591.2) Services 303.5 (296.2) Technology 264.8 (-) Others 130.1 (90.5) Internal Sales -941.7 (-871.2) Group 2.901.1 (2,381.5)
Earnings before tax by Division (EUR million):
Q1 2008 (Q1 2007) Steel 172.5 (181.5) Trading 48.6 (64.8) Tubes 66.0 (65.5) Services 4.9 (8.1) Technology 4.2 (-) Others/Consolidation -4.3 (5.6) Group 291.9 (325.4)
As before, we are striving to achieve significant growth within the Group in the financial year 2008. More than 50 % of this growth is to be generated from the first-time full-year inclusion of the companies of the Klöckner Group in our new Technology Division. Associated with this growth, we anticipate operating profit before tax in excess of EUR 900 million.
Express reference is made to the fact that opportunities and risks arising from currently unforeseeable trends in sales prices, input materials and capacity level developments, as well as changes in the currency parity, may considerably affect performance in the course of the remaining financial year 2008.
More information can be found in the full press release and interim report published today (see www.salzgitter-ag.de).
end of announcement euro adhoc
Further inquiry note:
Bernhard Kleinermann
Tel.: +49 (0) 5341-21-3783
E-Mail: kleinermann.b@salzgitter-ag.de
Branche: Iron & Steel
ISIN: DE0006202005
WKN: 620200
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