- Operating earnings (EBITDA) up by 23.2% to ââ??¬65.8 million
- Result includes non-recurring expenses of ââ??¬1.9 million
- EBITDA margin increased to 8.6% (2008: 5.2%)
- Turnover dropped to ââ??¬762.3 million due to crude oil price development
- International segment achieved record earnings of ââ??¬19.9 million
- Large-scale investment of around ââ??¬55.0 million to increase output of high value products
(Please note: All figures contained in this press release are preliminary and unaudited)
Salzbergen, 19 February 2010.
H&R WASAG AG has increased its profitability despite the economic crisis: With a share of around 95% of consolidated turnover, the Chemical-Pharmaceutical Raw Materials Division was the main contributor to this positive development. Despite higher volumes of main products in this division, consolidated turnover was down by 26.4% to ââ??¬762.3 million. This decline was mainly attributable to lower raw materials prices, which were passed on to customers in reduced product prices. EBITDA increased by 23.2% to ââ??¬65.8 million (previous year: ââ??¬53.4 million) while EBIT was up by 21.3% from ââ??¬37.1 million to ââ??¬45.0 million. The EBITDA margin improved considerably from 5.2% to 8.6%. Consolidated net profit rose by 117.9% to ââ??¬25.5 million (previous year: ââ??¬11.7 million) and earnings per share surged to ââ??¬0.85 (previous year: ââ??¬0.39). Results include non-recurring expenses (ââ??¬1.5 million) for restructuring the Plastics Division as well as the increase of a provision (ââ??¬0.4 million) for environmental damages at Sythengrund. When comparing these figures with the previous year it is worth noting that there was a one-off impact on consolidated operating earnings in 2008 due to a provision of ââ??¬22.0 million for an anti-trust fine.
Significant increase in results in Chemical-Pharmaceutical Raw Materials Divisions
EBITDA of the largest segment, the Chemical-Pharmaceutical Raw Materials Domestic Division (turnover share: 74.1%), went up by 37.5% to ââ??¬51.7 million despite the difficult economic environment. In the first half of the year in particular, the segmentââ?¬â?¢s sales volumes were impacted by lower demand on the back of the economic crisis. This in turn meant that refineries were running at a comparatively low capacity of 80%. It was therefore impossible to fully leverage the increased capacities created in the course of the ââ?¬Å?Project 40ââ?¬Â initiative which was completed at the beginning of the year. Demand for crude oil-based speciality products went up considerably in the second half of the year, resulting in capacity utilisation almost reaching these new limits. As a result total volumes of main products sold during the year increased slightly compared to 2008 reaching a new sales volume record. ââ?¬Å?Prices for our feedstocks on the other hand continued to increase in the course of the year and we were only able to pass on these increases with time lag.
The positive volume development is therefore not fully reflected in the segment�s results,�comments Gert Wendroth, Chairman of the Executive Board of H&R WASAG AG.
EBITDA at the Chemical-Pharmaceutical Raw Materials International Division went up by 56.7% to a record ââ??¬19.9 million (2008: ââ??¬12.7 million). ââ?¬Å?We are now benefiting from making an early start in positioning ourselves in the dynamically growing Asian market,ââ?¬Â explains Niels H. Hansen, Chief Operating Officer.
Plastics Division restructuring program
The situation in the Plastics Division remained challenging. This smallest segment of H&R WASAG AG, accounting for just 5.1% of turnover, was again facing declining sales. The Company responded to continued low demand particularly from automotive industry, the divisionââ?¬â?¢s most important customer base, by launching an extensive restructuring program. Half of the operating loss (EBITDA) of ââ??¬-3.0 million (previous year: ââ??¬+2.1 million) are attributable to provisions for ongoing restructuring measures. In addition to adjusting capacities, the Company is pushing initiatives to generate new customer groups, e.g. from the medical sector.
Positive outlook
At the beginning of 2010, demand for products in the Chemical-Pharmaceutical Raw Materials Divisions continues to be robust. However, adverse weather conditions proved to be a particular challenge for German refineries, resulting in short, unscheduled shut-downs.
Construction work on a propane deasphalting plant is scheduled to begin at the Hamburg refinery in the 1st quarter. At around ââ??¬55.0 million, this is the largest single investment in the history of H&R WASAG AG, which will further increase the refineryââ?¬â?¢s production depth and raise its output value. After the scheduled completion in the 4th quarter of 2011, the Executive Board is anticipating an additional EBITDA contribution of between ââ??¬12 million to ââ??¬14 million per year from 2012 onwards. ââ?¬Å?The syndicated loan of ââ??¬300.0 million from 2008 ensures that there is a sound financial base to fund this project. Originally the start date was planned for 2008, by postponing it we are now able to benefit from lower costs from engineering services and steel,ââ?¬Â comments Andreas Keil, Chief Financial Officer.
Efforts to reduce costs in the considerably smaller Plastics Division are starting to deliver the first positive effects. But despite gaining new customers from other sectors, a sustained return to profitability in the long-term also requires demand in the automotive sector to pick up.
ââ?¬Å?We are optimistic about the 2010 financial year in view of the positive development in the Chemical-Pharmaceutical Raw Materials Divisions and the initial success of restructuring efforts in the Plastics Division. Assuming that crude oil markets remain stable and the economy continues to recover, we anticipate consolidated operating earnings in 2010 to exceed 2009 figures,ââ?¬Â explains Wendroth. He added that the Company has now set the tracks to achieve further growth in turnover and earnings by deciding to build the propane deasphalting plant. At the same time product development for improving aromatic plasticers for the tyre industry will be further enforced in the light of new regulations for the labelling of tyres from 2012 onwards to improve properties like fuel economy, abrasion, wet grip and noise.
Upcoming dates:
30 March 2010
Final figures for the financial year 2009
14 May 2010
Publication of Q1 Interim Report 2010
27 May 2010
Annual Shareholders� Meeting in Hamburg
13 August 2010
Publication of Q2 Interim Report 2010
12 November 2010
Publication of Q3 Interim Report 2010
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
About H&R WASAG AG:
H&R WASAG AG, a speciality chemicals group, is listed in the SDAX. The Company develops and produces crude oil-based chemical-pharmaceutical speciality products and high-precision plastic parts.