Click here to close now.

Welcome!

.NET Authors: Pat Romanski, Elizabeth White, Andreas Grabner, Trevor Parsons, Tad Anderson

News Feed Item

Klöckner & Co SE: Turnover and Sales up on Prior-Year Period

DUISBURG, Germany, November 7, 2012 /PRNewswire/ --

- Earnings trend affected by economic slowdown and ongoing price erosion. Restructuring program continuing to plan and significantly further expanded. Full-year EBITDA forecast of EUR130-140 million before restructuring

- Turnover in the first nine months increased by 9.1% to 5.5 million tons and sales by 7.4% to some EUR5.8 billion through acquisitions and strong organic growth in the USA

- EBITDA for the year to date at EUR117 million (including restructuring expenses: EUR97 million), compared with EUR203 million in first nine months of 2011

- Net income at a negative EUR33 million (including restructuring expenses and impairments: negative EUR 76 million), as against EUR38 million in the previous year

- Earnings per share at minus EUR 0.75, compared with EUR0.47 in the prior-year period

- Restructuring measures significantly expanded with reduction of approximately 60 locations and in the workforce by over 1,800; annual EBITDA contribution expected to be around EUR150 million

- Q4 EBITDA before restructuring expenses expected to be around third-quarter level, with a strong positive cash flow

- For the current year as a whole, turnover expected to increase by about 6.5% and sales by about 5%; EBITDA before restructuring expenses expected to be EUR130-140 million

All figures relate to the first nine months relative to the first nine months of the prior year

Klöckner & Co SE substantially increased turnover and sales in the first nine months, notably due to the acquisition of Macsteel Service Centers USA and strong organic growth in the USA. The EUR117 million EBITDA before restructuring expenses was nonetheless down on the prior-year figure due to the weaker economic trend in Europe and price pressure on steel products that has persisted since the end of the first quarter. As demand also rose less strongly than expected after summer, third-quarter EBITDA, at EUR19 million, was below the prior-year figure.  

Gisbert Rühl, Chairman of the Management Board of Klöckner & Co SE: "We once again responded in good time to the strained situation in Europe and launched a comprehensive restructuring program as early as September 2011. This was a key factor in our ability to buffer the negative impacts of a very weak steel market at short notice. We have now significantly expanded the measures once more and have marked up the expected annual EBITDA contribution from the program to around EUR150 million. In contrast to Europe we made further gains in the US market where there is still dynamic growth, among other things thanks to the completed integration of Macsteel."

Turnover and sales increased, earnings below prior year Klöckner & Co increased turnover in the first nine months of fiscal 2012, primarily driven by acquisitions, by 9.1% to 5.5 million tons, compared with 5.0 million tons in the prior-year period.

In the Europe segment, turnover was down by 5.9% compared with the first nine months of 2011 due to the increasingly difficult economic environment and ongoing discontinuation of underperforming activities; the market as a whole contracted by no less than 9%.

In the Americas segment, by contrast, turnover increased by 41.3% compared with the first nine months of 2011, primarily due to acquisitions. Excluding the acquisition, turnover in the USA showed 6.7% organic growth, significantly better than the market (3.3%) and the prior-year figure.

Group sales in the first three quarters of 2012 came to some EUR5.8 billion, up 7.4% on sales in the first nine months of 2011. The ongoing price pressure meant that the gross profit margin, at 17.2%, fell short of the 18.8% attained in the prior-year period. EBITDA fell as a result from EUR203 million in the first nine months of 2011 to EUR117 million (a decrease of 42.5%) before restructuring expenses (including restructuring expenses: EUR97 million). Third-quarter EBITDA, at EUR19 million, was likewise down on the prior-year figure of EUR37 million.

Overall, Klöckner & Co consequently generated a net loss of EUR33 million (including restructuring expenses and impairments: net loss of EUR76 million), compared with net income of EUR38 million in the prior-year period. Basic earnings per share amounted to a negative EUR 0.75 compared with a positive EUR0.47 in the prior-year period.

Solid equity base retained

The changes in the statement of financial position are dominated by repayment of the convertible bond due in July. Total assets decreased as a result compared with the 2011 year-end by 7.5% to EUR4,354 million. Net working capital, at EUR1,666 million, was slightly down on the preceding quarter, reflecting the absence of the usual seasonal recovery after the summer (Q2: EUR1,685 million).

The equity ratio was some 41% as of September 30, 2012, slightly up on the level at the end of fiscal 2011. Net financial debt amounted to EUR596 million. With gearing of 37%, net financial debt was still held low relative to shareholders' equity. Liquidity remained strong at EUR656 million despite repayment of the EUR325 million convertible bond on maturity.

Restructuring continuing to plan and further expanded

In light of the ongoing decline in European steel demand and the uncertain outlook, Klöckner & Co has continued as planned and substantially expanded the restructuring program launched in September 2011.

Besides cutting selling, general and administrative expenses, the restructuring measures focus on closing unprofitable branches and discontinuing insufficiently profitable activities. Since the start of the program in September 2011, this has already led to the reduction of 20 locations and in the workforce by some 800. The Group's announced withdrawal from Eastern Europe is well advanced.

The Group-wide restructuring and improvement program has contributed EUR37 million to EBITDA since its launch in September 2011. On a full-year basis, the Group is aiming for a contribution in excess of EUR50 million in the current year. Including the additional measures projected, Klöckner & Co anticipates an annual contribution to EBITDA of around EUR150 million for the Group as a whole from 2014 once all measures have taken full effect. The size of the workforce will be reduced as a result by over 1,800 or 16% and the number of branches from 290 to about 230.

Outlook

Due to the adverse market environment and the usual seasonal slowdown in business activities at year-end, the Group expects EBITDA before restructuring expenses to remain at around the third-quarter level in the fourth quarter of 2012, with a strong positive cash flow. Gradually increasing contributions from the restructuring program will help counter margin pressure deriving from the current economic environment. Klöckner & Co continues to expect that customers will destock inventories due to the downward price trend. Accordingly, the Group anticipates that fourth-quarter turnover will be down on the preceding quarter.

Overall, Klöckner & Co expects in fiscal 2012 to increase turnover by about 6.5% and sales by about 5% compared with the prior year, with operating income (EBITDA) of EUR130-140 million before restructuring expenses. Expenditure for the expansion of the restructuring program is expected to amount to EUR60 million including pull back from Eastern Europe and the announced restructuring of the French country organization, with at minimum two-thirds of this figure to be incurred during the current year. Due to the restructuring program and the seasonal reduction in working capital toward the year-end, it should be possible to reduce net financial debt below EUR500 million.

Further inquiry note:
Dr. Thilo Theilen
Head of Investor Relations & Corporate Communications
Telefon: +49(0)203-307-2050
E-Mail: [email protected]

ISIN: DE000KC01000
WKN:     KC0100

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

@ThingsExpo Stories
One of the biggest impacts of the Internet of Things is and will continue to be on data; specifically data volume, management and usage. Companies are scrambling to adapt to this new and unpredictable data reality with legacy infrastructure that cannot handle the speed and volume of data. In his session at @ThingsExpo, Don DeLoach, CEO and president of Infobright, will discuss how companies need to rethink their data infrastructure to participate in the IoT, including: Data storage: Understanding the kinds of data: structured, unstructured, big/small? Analytics: What kinds and how responsiv...
Since 2008 and for the first time in history, more than half of humans live in urban areas, urging cities to become “smart.” Today, cities can leverage the wide availability of smartphones combined with new technologies such as Beacons or NFC to connect their urban furniture and environment to create citizen-first services that improve transportation, way-finding and information delivery. In her session at @ThingsExpo, Laetitia Gazel-Anthoine, CEO of Connecthings, will focus on successful use cases.
The Workspace-as-a-Service (WaaS) market will grow to $6.4B by 2018. In his session at 16th Cloud Expo, Seth Bostock, CEO of IndependenceIT, will begin by walking the audience through the evolution of Workspace as-a-Service, where it is now vs. where it going. To look beyond the desktop we must understand exactly what WaaS is, who the users are, and where it is going in the future. IT departments, ISVs and service providers must look to workflow and automation capabilities to adapt to growing demand and the rapidly changing workspace model.
Sensor-enabled things are becoming more commonplace, precursors to a larger and more complex framework that most consider the ultimate promise of the IoT: things connecting, interacting, sharing, storing, and over time perhaps learning and predicting based on habits, behaviors, location, preferences, purchases and more. In his session at @ThingsExpo, Tom Wesselman, Director of Communications Ecosystem Architecture at Plantronics, will examine the still nascent IoT as it is coalescing, including what it is today, what it might ultimately be, the role of wearable tech, and technology gaps stil...
Almost everyone sees the potential of Internet of Things but how can businesses truly unlock that potential. The key will be in the ability to discover business insight in the midst of an ocean of Big Data generated from billions of embedded devices via Systems of Discover. Businesses will also need to ensure that they can sustain that insight by leveraging the cloud for global reach, scale and elasticity.
The Internet of Things (IoT) promises to evolve the way the world does business; however, understanding how to apply it to your company can be a mystery. Most people struggle with understanding the potential business uses or tend to get caught up in the technology, resulting in solutions that fail to meet even minimum business goals. In his session at @ThingsExpo, Jesse Shiah, CEO / President / Co-Founder of AgilePoint Inc., showed what is needed to leverage the IoT to transform your business. He discussed opportunities and challenges ahead for the IoT from a market and technical point of vie...
IoT is still a vague buzzword for many people. In his session at @ThingsExpo, Mike Kavis, Vice President & Principal Cloud Architect at Cloud Technology Partners, discussed the business value of IoT that goes far beyond the general public's perception that IoT is all about wearables and home consumer services. He also discussed how IoT is perceived by investors and how venture capitalist access this space. Other topics discussed were barriers to success, what is new, what is old, and what the future may hold. Mike Kavis is Vice President & Principal Cloud Architect at Cloud Technology Pa...
Hadoop as a Service (as offered by handful of niche vendors now) is a cloud computing solution that makes medium and large-scale data processing accessible, easy, fast and inexpensive. In his session at Big Data Expo, Kumar Ramamurthy, Vice President and Chief Technologist, EIM & Big Data, at Virtusa, will discuss how this is achieved by eliminating the operational challenges of running Hadoop, so one can focus on business growth. The fragmented Hadoop distribution world and various PaaS solutions that provide a Hadoop flavor either make choices for customers very flexible in the name of opti...
The true value of the Internet of Things (IoT) lies not just in the data, but through the services that protect the data, perform the analysis and present findings in a usable way. With many IoT elements rooted in traditional IT components, Big Data and IoT isn’t just a play for enterprise. In fact, the IoT presents SMBs with the prospect of launching entirely new activities and exploring innovative areas. CompTIA research identifies several areas where IoT is expected to have the greatest impact.
Advanced Persistent Threats (APTs) are increasing at an unprecedented rate. The threat landscape of today is drastically different than just a few years ago. Attacks are much more organized and sophisticated. They are harder to detect and even harder to anticipate. In the foreseeable future it's going to get a whole lot harder. Everything you know today will change. Keeping up with this changing landscape is already a daunting task. Your organization needs to use the latest tools, methods and expertise to guard against those threats. But will that be enough? In the foreseeable future attacks w...
Disruptive macro trends in technology are impacting and dramatically changing the "art of the possible" relative to supply chain management practices through the innovative use of IoT, cloud, machine learning and Big Data to enable connected ecosystems of engagement. Enterprise informatics can now move beyond point solutions that merely monitor the past and implement integrated enterprise fabrics that enable end-to-end supply chain visibility to improve customer service delivery and optimize supplier management. Learn about enterprise architecture strategies for designing connected systems tha...
Dale Kim is the Director of Industry Solutions at MapR. His background includes a variety of technical and management roles at information technology companies. While his experience includes work with relational databases, much of his career pertains to non-relational data in the areas of search, content management, and NoSQL, and includes senior roles in technical marketing, sales engineering, and support engineering. Dale holds an MBA from Santa Clara University, and a BA in Computer Science from the University of California, Berkeley.
Wearable devices have come of age. The primary applications of wearables so far have been "the Quantified Self" or the tracking of one's fitness and health status. We propose the evolution of wearables into social and emotional communication devices. Our BE(tm) sensor uses light to visualize the skin conductance response. Our sensors are very inexpensive and can be massively distributed to audiences or groups of any size, in order to gauge reactions to performances, video, or any kind of presentation. In her session at @ThingsExpo, Jocelyn Scheirer, CEO & Founder of Bionolux, will discuss ho...
The cloud is now a fact of life but generating recurring revenues that are driven by solutions and services on a consumption model have been hard to implement, until now. In their session at 16th Cloud Expo, Ermanno Bonifazi, CEO & Founder of Solgenia, and Ian Khan, Global Strategic Positioning & Brand Manager at Solgenia, will discuss how a top European telco has leveraged the innovative recurring revenue generating capability of the consumption cloud to enable a unique cloud monetization model to drive results.
As organizations shift toward IT-as-a-service models, the need for managing and protecting data residing across physical, virtual, and now cloud environments grows with it. CommVault can ensure protection &E-Discovery of your data – whether in a private cloud, a Service Provider delivered public cloud, or a hybrid cloud environment – across the heterogeneous enterprise. In his session at 16th Cloud Expo, Randy De Meno, Chief Technologist - Windows Products and Microsoft Partnerships, will discuss how to cut costs, scale easily, and unleash insight with CommVault Simpana software, the only si...
Analytics is the foundation of smart data and now, with the ability to run Hadoop directly on smart storage systems like Cloudian HyperStore, enterprises will gain huge business advantages in terms of scalability, efficiency and cost savings as they move closer to realizing the potential of the Internet of Things. In his session at 16th Cloud Expo, Paul Turner, technology evangelist and CMO at Cloudian, Inc., will discuss the revolutionary notion that the storage world is transitioning from mere Big Data to smart data. He will argue that today’s hybrid cloud storage solutions, with commodity...
Every innovation or invention was originally a daydream. You like to imagine a “what-if” scenario. And with all the attention being paid to the so-called Internet of Things (IoT) you don’t have to stretch the imagination too much to see how this may impact commercial and homeowners insurance. We’re beyond the point of accepting this as a leap of faith. The groundwork is laid. Now it’s just a matter of time. We can thank the inventors of smart thermostats for developing a practical business application that everyone can relate to. Gone are the salad days of smart home apps, the early chalkb...
Cloud data governance was previously an avoided function when cloud deployments were relatively small. With the rapid adoption in public cloud – both rogue and sanctioned, it’s not uncommon to find regulated data dumped into public cloud and unprotected. This is why enterprises and cloud providers alike need to embrace a cloud data governance function and map policies, processes and technology controls accordingly. In her session at 15th Cloud Expo, Evelyn de Souza, Data Privacy and Compliance Strategy Leader at Cisco Systems, will focus on how to set up a cloud data governance program and s...
Roberto Medrano, Executive Vice President at SOA Software, had reached 30,000 page views on his home page - http://RobertoMedrano.SYS-CON.com/ - on the SYS-CON family of online magazines, which includes Cloud Computing Journal, Internet of Things Journal, Big Data Journal, and SOA World Magazine. He is a recognized executive in the information technology fields of SOA, internet security, governance, and compliance. He has extensive experience with both start-ups and large companies, having been involved at the beginning of four IT industries: EDA, Open Systems, Computer Security and now SOA.
The industrial software market has treated data with the mentality of “collect everything now, worry about how to use it later.” We now find ourselves buried in data, with the pervasive connectivity of the (Industrial) Internet of Things only piling on more numbers. There’s too much data and not enough information. In his session at @ThingsExpo, Bob Gates, Global Marketing Director, GE’s Intelligent Platforms business, to discuss how realizing the power of IoT, software developers are now focused on understanding how industrial data can create intelligence for industrial operations. Imagine ...