- Sales for the first half year decreased to ââ??¬ 333.1 million (-32.7%) as a result of the
crude oil price development
- EBITDA margin improved to 10.0% (H1 2008: 8.0%)
- EBITDA amounts to ââ??¬ 33.4 million (H1 2008: ââ??¬ 39.7 million)
- Higher earnings anticipated for second half of the year
Salzbergen, 14 August 2009
In a market environment impacted by the economic crisis, H&R WASAG AG suc-ceeded in improving the EBITDA margin to 10.0% in the first half of 2009 (H1 2008: 8.0%). As a result, the company has offset a significant proportion of crude oil price driven decline in sales by 32.7% to ââ??¬ 333.1 million on the earnings side. While sales in the Chemical-Pharmaceutical Products Division were steady throughout the first half year, purchasing and sales prices dropped significantly compared to the previous year. The cause of this development is the crude oil price. In the first half of 2009 it was on average 53 percent below the previous yearââ?¬â?¢s level based on the dollar and 46 percent below the previous year based on the euro. The considerable increase in crude oil prices, especially in the second quarter, could only be passed on to customers with a time lag. This effect had a negative impact on earnings in the second quarter: EBITDA for the first half year fell by 15.9% to ââ??¬ 33.4 million (H1 2008: ââ??¬ 39.7 million), while EBIT amounted to ââ??¬ 22.4 million (H1 2008: ââ??¬ 31.8 million). Consolidated net income totalled ââ??¬ 12.6 million (H1 2008: ââ??¬ 20.4 million) and earnings per share amounted to ââ??¬ 0.42 after coming in at ââ??¬ 0.68 in the first half of 2008. ââ?¬Å?This result is remarkable considering the extremely difficult conditions and underlines the sustainability of our business model,ââ?¬Â explains Gert Wendroth, CEO of H&R WASAG AG.
Sound results in the Chemical-Pharmaceutical Segments
The strong increase in crude oil prices in the second quarter prevented a repeat of the excellent results achieved in the first quarter of 2009 in the chemical-pharmaceutical segments. ââ?¬Å?The moderate decline in earnings by 7.9% in the difficult first half year in these segments, which are highly relevant to the Groupââ?¬â?¢s result, makes us optimistic about the further course of the business year,ââ?¬Â explains Wendroth. The company recorded increased sales volumes across almost all product groups since June. ââ?¬Å?The obligation to use label-free plasticizers throughout Europe from 2010 onwards is already stimulating demand,ââ?¬Â states Niels H. Hansen, COO of H&R WASAG AG.
The situation is more difficult in the significantly smaller Plastics division. In this seg-ment, H&R WASAG AG recorded an operating loss (EBITDA) of ââ??¬ -0.4 million (H1 2008: ââ??¬ 2.1 million) due to the sales crisis in the automotive industry. ââ?¬Å?We are pulling out all the stops to restructure and realign the Plastics business and after a difficult transitional year soon hope to be able to start generating profits again,ââ?¬Â explains Wen-droth.
Financing structure improved
The structure of external financing also improved considerably in the second quarter of 2009. Ten-year KfW loans amounting to ââ??¬ 20 million were taken out from IKB Deutsche Industriebank AG. The existing syndicated loan was reduced by the corresponding vo-lume. In July, H&R WASAG AG took advantage of the currently low interest rate to con-clude interest rate hedges for five years amounting to ââ??¬ 40 million based on the fixed interest rate. ââ?¬Å?With the KfW loan, we have ensured an attractive interest rate in the long-term for a credit volume totalling ââ??¬ 60 million,ââ?¬Â says Andreas Keil, CFO of H&R WASAG AG.
Better second half year anticipated
The Chemical-Pharmaceutical Division seems to have overcome the worst: After sales in chemical-pharmaceutical specialties increased by 13.3% in the second quarter compared to the previous quarter, the positive trend also continued at the beginning of the second half of the year. ââ?¬Å?The main task in sales is now to improve the margin level, which was low for much of the second quarter. This is why we have increased prices, and this is likely to have a positive impact on earnings from August onwards,ââ?¬Â explains Hansen. In the significantly smaller Plastics Division, it will take until the medium-term for measures taken by management to result in an improvement in the earnings situation. Taking a one-time restructuring expense into consideration, a loss in the middle single digit million region is expected in the Plastics Business for the full year.
The preparatory work of the product enhancing project ââ?¬Ë?Golden Cutââ?¬â?¢ is continued: ââ?¬Å?As soon as the economic parameters allow for implementation, we will start to launch the project. Plans are already far advanced,ââ?¬Â explains CFO Andreas Keil. CEO Gert Wendroth expects H&R WASAG to increase sales and earnings compared to the first half of 2009: ââ?¬Å?Our business model has proven its worth in the economic crisis and displayed substan-tial earning power. As the situation is improving in the Chemical-Pharmaceutical Division and we anticipate an increase in margins and sales volumes, we are expecting earnings to rise in the second half of the year under the assumption of stable raw material costs.ââ?¬Â
Upcoming dates:
11 November 2009
Q3 Interim Report 2009
19 February 2010
Preliminary figures for the financial year 2009
Press and Analysts� conference
30 March 2010
Final figures for the financial year 2009
14 May 2010
Q1 Interim Report 2010
27 May 2010
Annual Shareholders� Meeting in Hamburg
Detailed information about current developments can be found in the interim reports as of 30 June 2009, which will be available on our Internet side at www.hur-wasag.com. Please find attached our summary table with key figures for the first half year 2009.
Contact:
H&R WASAG AG, Investor Relations / Communications, Christian Pokropp
Am Sandtorkai 64, 20457 Hamburg, Germany
Tel.: + 49 ââ?¬â?? (0) 40-43218-321, Fax: + 49 ââ?¬â?? (0) 40-43218-390, Mail: Christian.Pokropp(at)hur-wasag.de
www.hur-wasag.com
Additional information regarding H&R WASAG AG:
H&R WASAG AG is an SDAX-listed specialty chemicals company engaged in the development and manu-facture of crude oil-based chemical-pharmaceutical specialty products, and in the production of preci-sion plastic components. The Group companies comprising the individual divisions enjoy excellent positions as market and/or technology leaders.
Forward looking statements:
This press-release contains forward-looking statements. These statements are based on current estimates and currently available information. They are not guarantees of future performance, involve certain risks and uncertainties that are difficult to predict and are based upon assumptions as to future events that may not prove to be accurate. Many factors could cause the actual results, performance or achievements of H&R WA-SAG to be materially different from those that may be expressed or implied by such statements. We do not assume any obligation to update the forward-looking statements contained in this report.