Report on the financial key performance indicators of the voestalpine Group

In the first nine months of the current business year, at EUR 8,254.9 million, the revenue of the voestalpine Group remained at a stable level compared to the previous year (EUR 8,268.8 million). Revenue losses suffered by the Metal Engineering Division as a result of the closure of the standard rail production in Duisburg as of the end of the 2013 calendar year was compensated by larger delivery volumes in the Special Steel Division. In a year-to-year comparison, revenue in both the Metal Forming Division and the Steel Division remained constant.

The voestalpine Group’s operating result (EBITDA) improved during the first three quarters of 2014/15 by 8.8% compared to the previous year, going from EUR 999.6 million to EUR 1,087.2 million. It should be noted in this context that in the second quarter of 2014/15, non-recurring effects in the amount of EUR 66.5 million were recorded as a result of the sale of the Flamco Group in August 2014, the agreement at the end of September 2014 to sell the automotive companies voestalpine Polynorm Van Niftrik B.V. and voestalpine Polynorm Plastics B.V., and the structural reorganization of pension obligations in individual Metal Forming Division companies located in the Netherlands. Excluding these non-recurring effects, EBITDA rose by 2.1% to EUR 1,020.7 million. The EBITDA margin therefore rose from 12.1% in the previous year to 13.2% in the current year. Excluding non-recurring effects, the EBITDA margin for the current year is still 12.4%. During the same period, profit from operations (EBIT) improved compared to the previous year by 10.2%, going from EUR 569.3 million to EUR 627.4 million. Adjusted by the non-recurring effect of EUR 45.2 million resulting from the aforementioned extraordinary income, EBIT rose by 2.3% to EUR 582.2 million. The adjusted EBIT margin thus increased to 7.1% compared to 6.9% in the previous year. With the exception of the Metal Engineering Division, which nevertheless remained the Group’s most profitable division despite the slight decline in the operating result, all other divisions improved their profitability in the first three quarters of 2014/15 in a year-to-year comparison.

Although the voestalpine Group’s gross financial debt increased as of December 31, 2014, net interest charges, which had amounted to EUR 125.0 million as of the end of December 2013, fell as of the same reporting date in 2014 by 22.6% to EUR 96.8 million. The increase in gross financial debt resulted primarily from the refinancing of hybrid bond 2007 (volume: EUR 500 million), which was redeemed as of the end of October 2014, by the issue of corporate bond 2014 (issue on: October 14, 2014, volume: EUR 400 million). While the hybrid bond was recognized in equity, corporate bond 2014 is recognized as part of borrowed capital. As interest rates fell in the past quarters, interest expenditure decreased significantly; as a result, profit before tax rose substantially in a year-to-year comparison by 19.4%, going from EUR 444.3 million to EUR 530.6 million. Even after deduction of the non-recurring effects amounting to EUR 45.2 million, profit before tax in the first three quarters of 2014/15 improved by 9.3% to EUR 485.4 million.

The fact that profit for the period increased even more than profit before tax is due to the lower tax rate in the current business year. Thus, profit for the period rose by 26.6% from EUR 349.7 million to EUR 442.8 million. Adjusted by the non-recurring effects (EUR 43.4 million), profit for the period in the first three quarters of 2014/15 was EUR 399.4 million, corresponding to an increase compared to the previous year of 14.2%. Earnings per share in the current business year are EUR 2.28, more than one third higher than the figure of EUR 1.69 in the previous year. After deducting the non-recurring effects, earnings per share are EUR 2.03, still an increase of 20.1%.

Equity fell by 2.0%, from EUR 5,117.4 million as of December 31, 2013 to EUR 5,013.4 million as of December 31, 2014. Compared to the reporting date of March 31, 2014 (EUR 5,261.0 million), equity decreased by 4.7%. As previously stated, the reduction in equity is due to the refinancing of hybrid bond 2007, which is recognized in equity, by corporate bond 2014, which is reported as part of borrowed capital. This measure naturally had a impact on net financial debt, which increased in a year-to-year comparison by 19.4% from EUR 2,584.1 million (adjusted retroactively) to EUR 3,086.6 million. The increase corresponds precisely to the volume of the hybrid bond of EUR 500 million. Compared to the reporting date of March 31, 2014 (EUR 2,421.4 million, adjusted retroactively), net financial debt rose by 27.5%. Due to these changes in the Group’s financing structure, the gearing ratio (net financial debt in percent of equity) rose in the first nine months of the business year 2014/15 from 46.0% (adjusted retroactively) to 61.6%.

As of December 31, 2014, the voestalpine Group had 46,461 employees (FTE), almost exactly the same figure as in the previous year (46,460 employees, adjusted retroactively).