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Report on the financial key performance indicators of the voestalpine Group*

Comparison of the quarterly and six-month figures of the voestalpine Group

 

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In millions of euros

 

Q1

 

Q2

 

H1

 

 

 

 

2015/161

 

2016/17

 

2015/161

 

2016/17

 

2015/161

 

2016/17

 

Change

 

 

04/01–06/30/2015

 

04/01–06/30/2016

 

07/01–09/30/2015

 

07/01–09/30/2016

 

04/01–09/30/2015

 

04/01–09/30/2016

 

in %

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

3,001.7

 

2,772.4

 

2,785.0

 

2,635.4

 

5,786.7

 

5,407.8

 

–6.5

EBITDA

 

526.6

 

333.9

 

365.5

 

371.0

 

892.1

 

704.9

 

–21.0

EBITDA margin

 

17.5%

 

12.0%

 

13.1%

 

14.1%

 

15.4%

 

13.0%

 

 

EBIT

 

368.4

 

167.6

 

206.7

 

201.3

 

575.1

 

368.9

 

–35.9

EBIT margin

 

12.3%

 

6.0%

 

7.4%

 

7.6%

 

9.9%

 

6.8%

 

 

Profit before tax

 

328.2

 

138.9

 

176.4

 

172.5

 

504.6

 

311.4

 

–38.3

Profit after tax2

 

289.5

 

105.8

 

131.3

 

127.9

 

420.8

 

233.7

 

–44.5

Employees (full-time equivalent)

 

48,653

 

48,319

 

48,719

 

48,786

 

48,719

 

48,786

 

0.1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1
Q 1 2015/16, Q 2 2015/16 and H 1 2015/16 retroactively adjusted.
Further details are provided under “General information/Accounting policies.
2
Before deduction of non-controlling interests and interest on hybrid capital.

Comparison of the quarterly and six-month figures of the voestalpine Group, adjusted

 

(XLS:) Download

In millions of euros

 

Q1

 

Q2

 

H1

 

 

 

 

2015/161

 

2016/17

 

2015/161

 

2016/17

 

2015/161

 

2016/17

 

Change

 

 

04/01–06/30/2015

 

04/01–06/30/2016

 

07/01–09/30/2015

 

07/01–09/30/2016

 

04/01–09/30/2015

 

04/01–09/30/2016

 

in %

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

3,001.7

 

2,772.4

 

2,785.0

 

2,635.4

 

5,786.7

 

5,407.8

 

–6.5

EBITDA

 

389.0

 

333.9

 

365.5

 

371.0

 

754.5

 

704.9

 

–6.6

EBITDA margin

 

13.0%

 

12.0%

 

13.1%

 

14.1%

 

13.0%

 

13.0%

 

 

EBIT

 

236.9

 

171.5

 

212.9

 

204.9

 

449.8

 

376.4

 

–16.3

EBIT margin

 

7.9%

 

6.2%

 

7.6%

 

7.8%

 

7.8%

 

7.0%

 

 

Profit before tax

 

196.7

 

142.8

 

182.6

 

176.1

 

379.3

 

318.9

 

–15.9

Profit after tax2

 

151.7

 

108.7

 

138.7

 

130.6

 

290.4

 

239.3

 

–17.6

Employees (full-time equivalent)

 

48,653

 

48,319

 

48,719

 

48,786

 

48,719

 

48,786

 

0.1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1
Q 1 2015/16, Q 2 2015/16 and H 1 2015/16 retroactively adjusted.
Further details are provided under “General information/Accounting policies.
2
Before deduction of non-controlling interests and interest on hybrid capital.

A weaker price environment compared to the previous year—due mainly to lower pre-material costs and extremely challenging conditions in the oil and natural gas sectors—was the primary reason for the decline in revenue by 6.5% from EUR 5,786.7 million in the first half of 2015/16 to EUR 5,407.8 million in the first half of 2016/17. As far as volumes are concerned, the markedly lower demand in the oil and natural gas sectors had a significant impact on the Seamless Tubes business segment (Metal Engineering Division), while the Steel Division was able to increase its delivery volume in a year-over-year comparison as a result of the solid market momentum for high quality, sophisticated steel products. The sole division that was able to increase its revenue in a year-over-year comparison was the Metal Forming Division due to its expansion of automotive activities.

As far as earnings are concerned, the first half of 2016/17 was characterized by a sharp decline in the Steel Division in the first three months of the business year; in the second quarter of 2016/17, the division experienced a strong upward trend as higher prices were reflected in newly concluded contracts with customers. Earnings in the Steel Division were diametrically opposed to the trend in the first half of the previous year, when the economic environment in the European steel sector deteriorated due to increasing imports. Start-up losses at the direct reduction plant in Texas, USA, as well as the reduced performance of blast furnace 5 to allow for the fine-tuning of the coal injection system amounting to more than EUR 30 million impacted the operating result in the first half of 2016/17.

While the performance of the Metal Engineering Division dropped off substantially as a result of positive non-recurring effects in the previous year due to changes in consolidation and the weakness of the energy sector mentioned above, the Special Steel Division and the Metal Forming Division increased their earnings figures in comparison with the previous year. Viewing the Group as a whole, EBITDA fell by 21.0% from EUR 892.1 million in the first half of 2015/16 to EUR 704.9 million in the first half of 2016/17. EBIT decreased by 35.9% from EUR 575.1 million to EUR 368.9 million. However; the comparison of earnings has limited informative value because of the non-recurring effects in the same period of the previous year in connection with the acquisition of the controlling interest in companies that are part of the Seamless Tubes and Turnout Systems business segments. Revaluations based on the fair values less depreciation of hidden reserves had a positive impact on EBITDA of voestalpine AG in the first half of 2015/16 at EUR 137.6 million and EBIT at EUR 125.2 million, while in the first half of 2016/17, the effect on EBIT was negative at EUR –7.5 million. Taking these non-recurring effects into consideration, consolidated EBITDA in the first half of 2016/17 was EUR 704.9 million, just 6.6% behind last year’s figure of EUR 754.5 million. As a result of the decline in revenue, the adjusted EBITDA margin remained constant at 13.0% Because of the increase in the level of depreciation, which only impacted EBIT, in a year-to-year comparison, the decline of EBIT, which has been adjusted for non-recurring effects, is somewhat higher at –16.3%—a decrease from EUR 449.8 million (margin: 7.8%) to EUR 376.4 million (margin: 7.0%).

In the first half of 2016/17, profit before tax includes non-recurring effects of EUR –7.5 million (previous year: EUR 125.2 million); profit after tax includes non-recurring effects of EUR –5.6 million (previous year: EUR 130.4 million). Adjusted for non-recurring income and expenses, profit before tax went down by 15.9% from EUR 379.3 million in the first half of 2015/16 to EUR 318.9 million in the first half of 2016/17. The decline of the adjusted profit after tax was of similar magnitude—17.6% from EUR 290.4 million to EUR 239.3 million.

In a year-over-year comparison, equity rose by 1.6% from EUR 5,524.4 million as of September 30, 2015 to EUR 5,610.5 million as of September 30, 2016. Compared to the reporting date of March 31, 2016 (EUR 5,651.6 million), equity declined slightly by 0.7%. In the first half of 2016/17, payment of dividends amounting to more than EUR 200 million and actuarial losses in connection with adjustments of the interest rate for provisions for obligations relating to employee benefits, which could not be completely compensated despite the solid development of earnings in the first half of 2016/17, had a negative impact on equity.

During the past twelve months, net financial debt grew by 6.9% from EUR 3,152.9 million as of September 30, 2015 to EUR 3,370.0 million as of September 30, 2016. The main reason for this increase in debt was the Group’s high level of investment activity, which was markedly higher than the level of depreciation. Compared to the reporting date of March 31, 2016, net financial debt increased by 9.4% from EUR 3,079.9 million to EUR 3,370.0 million; the reasons for the rise during this period were the increase in net working capital, outflow of capital for investments, and particularly, the payment of dividends in July 2016. As a result, the gearing ratio went up both in a year-to-year comparison and compared to the reporting date of the business year 2015/16. While it was 57.1% as of the reporting date of September 30, 2015 and 54.5% as of March 31, 2016, as of September 30, 2016, it was at 60.1%.

Net financial debt can be broken down as follows:

Net financial debt

(XLS:) Download

 

 

09/30/2015

 

09/30/2016

 

 

 

 

 

Financial liabilities non-current

 

3,180.0

 

3,230.8

Financial liabilities current

 

735.8

 

1,025.3

Cash and cash equivalents

 

–329.1

 

–488.9

Other financial assets

 

–406.3

 

–375.8

Loans and other receivables from financing

 

–27.5

 

–21.4

Net financial debt

 

3,152.9

 

3,370.0

In the previous year, investment volume reached a new peak due to various major projects. Because only part of these projects could be completed in the past business year, the amount spent on investments was again considerably higher than the level of depreciation in this business year as well. Overall, however, investment expenditure nevertheless fell by 27.3% from EUR 647.3 million in the first half of 2015/16 to EUR 470.8 million in the first half of 2016/17.

As of September 30, 2016, the voestalpine Group had 48,786 employees (FTE). In a year-to-year comparison (48,719 FTE as of September 30, 2015), this is an increase of 0.1%. Headcount increased in the Special Steel Division due to acquisitions and in the Metal Forming Division due to an expansion of automotive activities. It decreased, however, in both the Steel Division and the Metal Engineering Division (adjustment in the number of personnel due to the difficult market conditions in the oil and natural gas sectors). Compared to the reporting date of March 31, 2016 (48,367 FTE), this is a gain of 0.9%.

* This report is a translation of the original report in German, which is solely valid.

About voestalpine

The voestalpine Group is a steel-based technology and capital goods group that operates worldwide. With its top-quality products, the Group is one of the leading partners to the automotive and consumer goods industries in Europe and to the oil and gas industries worldwide.

Facts

50 Countries on all 5 continents
500 Group companies and locations
48,500 Employees worldwide

Earnings FY 2015/16

€ 11.1 Billion

Revenue

€ 1.6 Billion

EBITDA

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