EANS-News: Klöckner & Co SE: Weak operative start in Q1 2009, but debts reduced, financing secured and outlook improved
Duisburg (euro adhoc) -
. Sales volume and sales decline markedly
. Operating loss
(EBITDA) reaches - 132 million
. Net debt reduced by 249
million
. Successful restructuring of syndicated loan and
European ABS program
. Earnings situation expected to improve in
Q2 2009Corporate news transmitted by euro adhoc. The issuer/originator is solely responsible for the content of this announcement.
balance
Duisburg, May 14, 2009 - The adverse business trend that started in the fourth quarter of 2008 continued into the first quarter of 2009. In the first three months of the year, sales volume at the Klöckner & Co Group declined by 37.9% year-to-year to 1.1 million tons (Q1/2008: 1.7 million tons). Compared with the first quarter of 2008, Group sales fell by 34.0% to about EUR1.1 billion (Q1/2008: EUR1.7 billion). The collapse in demand and continued price erosion, which entailed further price-related inventory write-downs of about EUR35 million, resulted in negative EBITDA (earnings before interest, taxes, depreciation and amortization) of - EUR132 million. EBIT (earnings before interest and taxes) developed in line with EBITDA and amounted to - EUR149 million in the first quarter. Group earnings before taxes stood at - EUR165 million. As a result of a positive tax effect, Klöckner & Co recorded a consolidated net loss of - EUR127 million in the first quarter of 2009 (Q1/2008: EUR52 million).
In contrast to negative earnings developments, Klöckner & Co generated a high cash flow from operating activities of EUR261 million in the first quarter thanks to the rigorous reduction of net working capital. As a result, net financial debt was reduced markedly from EUR571 million at year's end to EUR322 million at the end of the first quarter of 2009. Since then, the Group has reduced its net debt further to about EUR270 million. In addition, roughly two-thirds of the planned reduction of 1,500 people in the global workforce, a step that is part of the Group's immediate action programs, has been implemented or initiated. Despite the Group's loss, the equity ratio declined only slightly from 35% to 33% in the first quarter of 2009.
"The reduction of operative costs and inventories, the improvement in net working capital and the substantial reduction of net financial debt show that our immediate actions are already bearing fruit and underscore the stability of our business model which allows significant positive cash flows during times of crisis," says Dr. Thomas Ludwig, Chairman of the Management Board of Klöckner & Co SE.
The continued optimization of the Group's financing structure was successfully completed in May with the restructuring of the syndicated loan and the European ABS program. Klöckner & Co can now draw on a total of EUR1.5 billion credit facilities free of performance-based covenants. "The new non-performance-based covenants are aligned even better with the economically fluctuating capital requirements of Klöckner & Co as a stock-keeping multi metal distributor. This prepares us even better for phases of economic weakness," Dr. Thomas Ludwig says.
The first signs of economic stabilization have emerged in recent weeks, although at a very low level. Demand seems to have bottomed out. At the same time, prices of some products are beginning to recover. As a result, Klöckner & Co expects earnings to improve markedly in the second quarter of 2009 compared with the first quarter. Nonetheless, results will be negative as well. In view of the persistently difficult economic conditions, Klöckner & Co cannot issue a forecast for the full year of 2009 at this time. However, the company expects full-year earnings for 2009 to remain markedly below the previous year's result and cannot preclude a net loss.
"Despite the difficult market environment, Klöckner & Co believes that its immediate action programs, its strong balance sheet and the restructuring of its financing structure put it in a good position to successfully overcome even a drawn-out crisis. Our financial leeway will allow us to return to our acquisition strategy in due course and to profit from the consolidation opportunities arising from this crisis," Dr.Thomas Ludwig notes.
Key Figures
| | |Q1 | |Q1 | | | |2009 | |2008*) | | | | | | | |Income Statement | | | | | | | | | | | |Sales |EUR |1,095 | |1,660 | | |million| | | | | | | | | | |Earnings before interest,| | | | | |taxes, | | | | | |depreciation and |EUR |-132 | |109 | |amortization (EBITDA) |million| | | | | | | | | | |Earnings before interest |EUR |-149 | |93 | |and taxes (EBIT) |million| | | | | | | | | | |Earnings before taxes |EUR |-165 | |76 | |(EBT) |million| | | | | | | | | | |Earnings after taxes |EUR |-127 | |52 | |(EAT) |million| | | | | | | | | | |Earnings per share |EUR |-2.70 | |1.09 | |(basic) | | | | | |Earnings per share |EUR |-2.43 | |1.06 | |(diluted) | | | | |
| | |Q1 | |Q1 | | | |2009 | |2008*) | |Cash Flow Statement | | | | | | | | | | | |Cash flow from operating |EUR |261 | |-10 | |activities |million| | | | | | | | | | |Cash flow from investing |EUR |-5 | |-141 | |activities |million| | | | | | | | | | |Balance Sheet | |Mar 31, | |Mar 31, | | | |2009 | |2008*) | | | | | | | |Working capital **) |EUR |1,006 | |1,407 | | |million| | | | | | | | | | |Net financial debt |EUR |322 | |571 | | |million| | | | | | | | | | |Equity |EUR |957 | |1.081 | | |million| | | | | | | | | | |Balance sheet total |EUR |2,897 | |3,084 | | |million| | | | | | | | | | | | | | | | |Key Figures | |Q1 | |Q1 | | | |2009 | |2008*) | | | | | | | | | | | | | |Sales volume |to '000|1,068 | |1,720 | | | | | | | | | | | | | | | |Mar 31, | |Mar 31, | | | |2009 | |2008*) | | | | | | | |Employees at end of | |9,925 | |10,282 | |period | | | | | | | | | | | | | | | | | |*) Prior year amounts restated | | | | |due to initial application of | | | | |IFRIC 14 | | | | |**) Working capital = Inventories plus trade receivables | |less trade payables |
About Klöckner & Co: Klöckner & Co is the largest producer-independent distributor of steel and metal products in the European and North American markets combined. The core business of the Klöckner & Co Group is the storage and distribution of steel and non-ferrous metals. About 185,000 active customers are supplied through around 260 distribution locations in 15 countries in Europe and North America. During the financial year 2008, the Company achieved sales of approximately EUR6.7 billion with more than 10,000 employees. The shares of Klöckner & Co SE are admitted to trading on the official market segment (Amtlicher Markt) of the Frankfurt Stock Exchange (Frankfurter Wertpapierbörse) with simultaneous admission to the sub-segment (Prime Standard) to the official market with further post-admission obligations. ISIN: DE000KC01000; WKN: KC0100; Common Code: 025808576. Klöckner & Co shares are listed in the MDax® Index of Deutsche Börse.
end of announcement euro adhoc
Further inquiry note:
|Peter Ringsleben - Corporate |Claudia Uhlendorf - Corporate |
|Communications |Communications |
|Phone: +49-203-307-2800 |Phone: +49-203-307-2289 |
|E-mail: |E-mail: |
|peter.ringsleben@kloeckner.de |claudia.uhlendorf@kloeckner.de |
|Dr. Thilo Theilen - Investor | |
|Relations | |
|Phone: +49-203-307-2050 | |
|E-Mail: thilo.theilen@kloeckner.de |
Branche: Metal Goods & Engineering
ISIN: DE000KC01000
WKN: KC0100
Index: CDAX, Classic All Share, Prime All Share
Börsen: Frankfurt / regulated dealing/prime standard
Berlin / free trade
Hamburg / free trade
Stuttgart / free trade
Düsseldorf / free trade
München / free trade