SIMONA in first half year 2017: SIMONA lifts first-half revenue beyond EUR 200 million mark for first time

Kirn, 2 August 2017. For the first time the SIMONA Group has managed to generate sales revenue of more than €200 million over the course of a six-month period. In the first half of 2017, sales revenue increased by 6.7 per cent to €200.3 million (prev. year: €187.7 million). Growth was fuelled by dynamic sales within the Semi-Finished Parts business in Western Europe, the United States and Asia. The rate of expansion in the second quarter of 2017 was slower. Sales revenue totalled €101.3 million, up 2.6 per cent on the figure posted for the same quarter a year ago (€98.7 million). At €13.2 million (prev. year: €16.4 million), EBIT was at the lower end of the guidance range. Earnings were impacted by currency effects and a substantial rise in the cost of raw materials at the beginning of the year.

Growth was again driven partly by the company's strong performance in the United States. This region generated sales revenue of €49.9 million in the first half of 2017, a year-on-year increase of 9.2 per cent. The region encompassing Asia and the Pacific recorded its strongest first-half performance to date, which saw sales revenue increase by 62.4 per cent to €13.7 million (prev. year: €8.4 million). Capacity expansions and an extension to the product range had a positive effect on business development in this region. The region as a whole accounted for 6.8 per cent of total sales revenue, up from 4.5 per cent a year ago. In Europe, sales revenue rose by 2.3 per cent to €136.7 million (prev. year: €133.6 million). Western Europe, and Spain in particular, recorded above-average growth. Sales revenue in Germany increased by 3.3 per cent to €53.1 million (prev. year: €51.4 million).

The product groups developed along different lines in the reporting period. Finished and Semi-Finished Parts produced significant growth of 8.4 per cent in the first six months, taking the figure to €161.1 million (prev. year: €148.6 million). Business relating to PVC sheets used within the aviation market, in particular, generated solid growth. At the same time, the Group's core business of chemical tank and equipment engineering in Europe also achieved encouraging levels of growth. The direction taken by Pipes and Fittings continues to be unsatisfactory. Sales revenue within this area stagnated at €39.2 million (prev. year: €39.1 million), which fell short of the Group's growth targets. While business focusing on industrial operations trended higher, activities within the area of civil engineering and lignite processing were stymied by a lack of projects in this field.

Earnings before interest and taxes (EBIT) at Group level totalled €13.2 million in the first half of the financial year (prev. year: €16.4 million). The EBIT margin fell from 8.7 per cent a year ago to 6.6 per cent. EBITDA declined from €23.2 million a year ago to €20.3 million at the end of the reporting period. The EBITDA margin stood at 10.1 per cent, compared to 12.4 per cent for the same period a year ago. Earnings performance in the first half of 2017 was driven primarily by sustained buoyancy in the United States. At the same time, it was impacted by a foreign exchange loss of €-3.9 million (prev. year: €-1.9 million) and a significant increase in commodity prices at the beginning of the year.

'After a very strong first quarter business was slightly less dynamic in the second quarter. We are extremely satisfied with the direction taken by sales revenue. Aviation business in the United States is developing at pace. In Asia we completed the strongest first half ever in terms of sales revenue, while operating profit for our plant in China was in positive territory. As for Europe, we are delighted by the performance seen in Western Europe and the gains made within our core business centred around the chemical industry,' said Wolfgang Moyses, Chief Executive Officer of SIMONA AG. 'As for earnings, we can only be partially satisfied with our performance on the whole. The second half is expected to remain stable. Provided that there are no unforeseen events as we move forward, we can confirm our revenue forecast of €370-380 million at the top end of the range. Due to the strength of the euro and our earnings performance in the first half, we anticipate that EBIT is more likely to be at the lower end of the €25-30 million guidance range,' said Moyses.