Pfleiderer Group publishes its 2016 results posting a record breaking EBITDA margin and presenting the Management Board's dividend payout recommend...

  • The Pfleiderer Group's consolidated net revenues earned in 2016 totaled EUR 960 million
  • The Group's normalized EBITDA (excluding non-recurring events) in 2016 soared 12.5% to EUR 149 million. The normalized EBITDA margin accounted for 15.5% of revenues marking its highest level in 20 years
  • The Pfleiderer Group consistently executes its strategic projects - capital expenditures in 2016 stood at EUR 52 million while in 2017 investments will exceed EUR 60 million
  • The Pfleiderer Group Management Board has successfully refinanced the debt incurred in 2014 - the savings following from lower debt service expenses are expected to total approx. EUR 6.5 million starting from 2018
  • The Management Board has recommended a dividend payout of PLN 71.2 million, i.e. PLN 1.1 per share to the General Meeting

These financial data have been compiled so as to ensure comparability in conjunction with the Group's legal and financial consolidation process.

26 April 2017, Wroclaw. The Pfleiderer Group presents its annual results - 2016 was a highly successful year. EBITDA margin reached a record in 20 years and accounted for 15.5%. Excellent set of financial results was achieved thanks to synergies resulting from the merger of the Group's business segments, optimization of the product mix and high utilization of Pfleiderer Group's capacities because of a very strong demand. The results improved also by focusing on value-added products that accounted for 65% of sales in 2016. Factors related to raw material prices also made a positive contribution.

Last year, the Group's net sales revenues were EUR 960 million (compared to EUR 985 million in 2015). The slightly lower level of sales relative to 2015 stems mainly from lower sales prices and the adverse FX translation impact. However, Pfleiderer Group recorded a strong growth in volumes across all segments, in particular by value-added products.

Net sales revenues in the Core West Segment totaled EUR 659 million and were slightly higher than in 2015 (up 1.2%), which is attributable mainly to higher sales volumes and the upswing in the sales of high margin products. Net sales in the Core East Segment, in turn, totaled EUR 339 million and were down 9.4% from the year before. Sales in this Segment were adversely affected by lower sales in the MDF Grajewo plant, the price pressure in Poland linked to lower raw material prices and FX gains and losses.

In 2016, the Group's normalized EBITDA (excluding non-recurring events) was EUR 149 million, up 12.5% over 2015. The Group's normalized EBITDA margin in 2016 was 15.5% of revenues, compared to the 13.4% margin recorded in 2015.

'2016 was in many aspects a crucial year for us and we delivered our promises. Implementing the 'ONE PFLEIDERER' program and our steadfast execution of the premium strategy of focusing on the higher value added product segment brought a record breaking EBITDA margin, the highest one achieved in the most recent 20 years. PFLEIDERER has successfully faced new challenges and this will support the Group's robust development. In 2017, we want to continue growing our EBITDA at a low double digit million euros level.' Michael Wolff, CEO of the Pfleiderer Group

On 25 April, the Pfleiderer Group Management Board recommended a dividend payout from the 2016 net profit of PLN 71.2 million, i.e. PLN 1.1 per share to the General Meeting. The rest of the profit will be earmarked for reserve capital. The final decision on the payout to shareholders will be made by the Ordinary General Meeting to be held by the end of June.

The Pfleiderer Group is pursuing strategic investments

In 2016, the Group's capital expenditures were EUR 52 million. Implementing strategic projects such as the 4-Pack project in Grajewo, a new worktop line and the Dynasteam project in Wieruszów and enhancing operational efficiency have contributed to sustainable growth in Pfleiderer's competiveness. In 2017, capital expenditures will remain high in excess of EUR 60 million. The key projects planned for this year include completion and implementation of the sanding line in the biggest plant in Neumarkt, execution of an investment project to recycle wood and cut raw material costs, and commissioning of a lacquering line in Leutkirch. In 2017, the Pfleiderer Group will also focus on intensifying sales and marketing activities under 'ONE COLLECTION'.

Debt refinancing will materially reduce debt service expenses

The Management Board of the Pfleiderer Group successfully refinanced the debt raised in 2014. The new debt service terms will contribute to a significant reduction of financing expenses. On 20 March, the Company reported the engagement of Credit Suisse International, Deutsche Bank AG, London Branch, Goldman Sachs Bank USA as Lead Arrangers and Joint Bookrunners to arrange financing in the form of senior secured credit facilities totaling EUR 450 million. The funds made available under the facilities will be used to refinance the debt incurred in 2014.

  • The margin will be 325 basis points for the EUR 350 million 7-year covenant-light term loan B facility (above the minimum EURIBOR of 0.75%), with the debt being raised at a discount: the Pfleiderer Group will raise financing equal to 99.0% of the nominal term loan B facility.
  • The margin will be 300 basis points for the EUR 100 million 5-year revolving loan facility (above the minimum EURIBOR of 0%).

Starting from 2018, savings in financial results are expected to be at approx. EUR 6.5 million compared to 2016/2017 (although term loan B is EUR 50 million higher.) Loan interest on a standalone base provides an cost advantage of EUR 11.4 million.

In 2017, the Pfleiderer Group would like to continue growing its EBITDA

The Pfleiderer Group declares that it would like to continue growing its EBITDA at a lower double digit million euro level mainly due to improving performance of higher sales in larger volumes of added value products. Thanks to the investments conducted in 2016 the Group currently has greater production capacities at its disposal (including the line to produce kitchen countertops in Wieruszów and the incremental production capacity obtained by implementing the 4Pack Project in Grajewo). It intends to achieve more savings by continuing to tweak operating efficiency and the duration of uninterrupted operations and by curtailing bottlenecks.

Pfleiderer Grajewo SA published this content on 26 April 2017 and is solely responsible for the information contained herein.
Distributed by Public, unedited and unaltered, on 26 April 2017 06:44:19 UTC.

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