Bekaert reports € 111 million underlying EBIT on higher sales
 
Highlights
 
Bekaert posted an increase of 3% in consolidated revenue, reaching € 2 157 million in first-half sales. Solid volume growth (+3.9%) and the aggregate effect of passed-on wire rod price increases and price-mix (+5.4%) boosted an organic sales growth of +9.3%. Part of this growth was offset by adverse currency movements
(-4.5%) and divestment effects (-1.9%).
 
While the underlying demand in automotive and industrial steel wire markets remains strong, the adverse margin effect from a number of factors that have weighed on our profitability since the second half of 2017 seem to be more impactful than we projected.  As reported before, these factors include:
 
- Continued raw material price increases
- The impact of changes to trade policies
- The slow recovery of Bridon-Bekaert Ropes Group
- Continued low demand for loose abrasive sawing wire
- Delayed investment activity in our oil and gas markets
- Higher than anticipated start-up costs in the plant expansions in EMEA and Asia Pacific
- The loss making activities in Figline Valdarno, Italy 
- Inflationary costs in general
- The difficult business climate in Latin America
- The divestment of Sumaré in Brazil
 
The combination of all those factors drove Underlying EBIT down by 37% to € 111 million.
 
Key Financials
 
- Consolidated sales of € 2.2 billion (+3%) and combined  sales of € 2.5 billion (+5%)
- Currency impact: € -95 million (-4.5%) on consolidated sales; € -151 million (-6.2%) on combined sales
- Underlying gross profit of € 311 million (14% margin) compared with € 382 million (18% margin)
- Underlying EBIT of € 111 million (5.1 % margin) compared with € 176 million (8.4% margin)
- EBIT of € 101 million (4.7% margin) compared with € 197 million (9.4% margin)
- Underlying EBITDA of € 214 million (9.9% margin) compared with € 277 million (13.2% margin) 
- EBITDA of € 204 million (9.5% margin) compared with € 297 million (14.2% margin) 
- Underlying ROCE of 8.1% compared with 13.1% and ROCE of 7.4% compared with 14.6% 
- Net debt of € 1 339 million. Net debt on underlying EBITDA was 3.1, versus 2.2 for the same period last year and 2.3 at year-end 2017.
 

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Source: Bekaert via Globenewswire