RHI AG: upward trend for revenues, strong increase in earnings in the first quarter of 2010

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quarterly report


RHI AG, the world market leader for refractory products, recorded a clear upward trend in revenues and a strong increase in earnings in the first quarter of 2010.

The Group´s revenues increased by 8.4% to EUR 342.2 million compared to the reference period of 2009 (Q1/2009: EUR 315.8 million). The Group´s EBIT soared by 124.8% to EUR 31.7 million compared to the first quarter of 2009 (Q1/2009: EUR 14.1 million). The EBIT margin more than doubled from 4.5% to 9.3%. The strong earnings development was attributable to better capacity utilisation, earnings effects of the cost optimisation programme implemented in 2009 and the fact that the new plant concept of RHI, which provides for maximum flexibility, is working.

RHI was able to fully benefit from the global positioning in the Steel and Industrial Divisions in the first quarter of 2010, with the Steel Division in particular recording substantial growth. Based on RHI´s good market position and growing demand product, prices remained stable.

Compared with the fourth quarter of 2009, the first quarter of 2010 showed a largely stable development. With revenues improving (Q4/2009: EUR 336.7 million), the operating result remained constant at EUR 33.6 million. In the fourth quarter of 2009, EBIT contained impairment losses and restructuring expenses of roughly EUR 11.5 million. In the first quarter of 2010 they amounted to EUR 1.9 million.

Moreover, all relevant balance sheet indicators improved as of 31 March 2010. Net debt was reduced to EUR 217.6 million versus EUR 233.2 million as of 31 December 2009. The equity ratio was raised from 17.9% as of 31 December 2009 to 20.0%. Cash and cash equivalents amounted to EUR 165.5 million (31 December 2009: EUR 139.8 million).

In early April 2010, RHI acquired a minority stake in one of the largest Russian refractories producers for the glass industry. This company operates a plant for fused cast bricks in Moscow and primarily supplies Russian customers.

@@start.t2@@1st Quarter
in EUR million                                                    2010          2009 1) Change
Revenues                                                            342.2         315.8         8.4%
Pre-restructuring EBIT 2)                                  33.6          14.1      138.3%
Pre-restructuring EBIT margin                            9.8%          4.5%    5.3ppts
EBIT                                                                    31.7          14.1      124.8%
EBIT margin                                                         9.3%          4.5%    4.8ppts
Profit before income tax                                    26.7            5.4      394.4%
Profit                                                                 21.5            4.7      357.4%
Net cash flow from operating activities            22.4          26.5      -15.5%
Capital expenditure                                              5.2            9.5      -45.3%
Employees at 31 March                                        7.279         7.567        -3.8%

1) after restructuring@@end@@

2) before impairment losses and restructuring expenses

Steel Division In the world steel market, the strong demand of the fourth quarter of 2009 continued at the beginning of 2010. Although the world steel output only grew by 4% in the first quarter of 2010 as compared to the fourth quarter of 2009, the Steel Division recorded above-average growth in RHI´s core markets in Europe as well as in the USA, Asia/Pacific and China. Full-line service contracts continued to achieve good success. Overall, RHI increased revenues in the Steel Division by 32.4% to EUR 218.8 million in the first quarter of 2010 (Q1/2009: EUR 165.3 million). EBIT, at EUR 14.8 million, was very pleasing after it had still been negative at EUR 6.8 million in the first quarter of 2009 and amounted to EUR 10.0 million in the fourth quarter of 2009.

Industrial Division In the Industrial Division, the level of incoming orders varied greatly in terms of region and sector and was highly volatile, with the sluggish recovery of the global construction industry and persisting financial restraints for investments in the customer industries causing negative effects. Divisional revenues in the first three months of 2010, at EUR 117.3 million, fell short of the excellent prior-year-figure of EUR 145.9 million. EBIT amounted to EUR 14.8 million (Q1/2009: EUR 19.5 million), which corresponds to a very positive EBIT margin of 12.6% (Q1/2009: 13.4%).

Raw Materials Division Revenues of RHI´s Raw Materials Division rose by 7.8% in the first quarter of 2010 as a consequence of the improved demand by the Steel Division in comparison with the reference period of 2009. EBIT increased from EUR 1.4 million to EUR 2.1 million. The upward trend of raw material prices continued in the first quarter of 2010, though in a slightly weaker form than in 2009.

Outlook Assuming that the current development in the financial markets has no negative effects on the real economy, RHI expects a result for the second quarter of 2010, which should essentially match that of the first quarter of 2010. Due to the market recovery, the ongoing expansion of the market position and the clearly improved cost structure compared with 2009, RHI is confident for the year 2010 to realise an increase in revenues and earnings in comparison with 2009.

Starting with the report on the first quarter of 2010, RHI adjusted the reporting structure to reflect the organisational changes implemented in 2009 as well as the internal reporting structure. For reasons of transparency and comparability, these reclassifications were also made retroactively for the years 2007, 2008 and 2009 as well as the reference period of 2009. Due to the comprehensive changes, RHI subjected the interim consolidated financial statements as of 31 March 2010 to a review by the auditor.

The interim consolidated financial statements as of 31 March 2010 as well as the online version of the quarterly financial report are available on RHI´s website www.rhi-ag.com.

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ots Originaltext: RHI AG
Im Internet recherchierbar: http://www.presseportal.ch

Further inquiry note:
Investor Relations
Barbara Potisk-Eibensteiner
Tel: +43-1-50213-6123
Email: barbara.potisk@rhi-ag.com

Branche: Refractories
ISIN:      AT0000676903
WKN:        874182
Index:    ATX Prime, ATX
Börsen:  Wien / official market

Weitere Meldungen: RHI AG

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