Sioen Industries annual results for 2008

Transcription

1 Sioen Industries annual results for 2008 Sales: EUR million EBITDA: EUR 37.7 million Net cash flow: EUR 24.2 million Results reported in accordance with IFRS standards. The complete financial report with management declaration and the complete auditor's report will be available from 31 March in the "Investor Relations" section of our website KEY FACTS The past year splits into two distinct parts. During the first three quarters we were well on the way to equalling the sales of our 2007 record year. Then, in the fourth quarter, the industrial world was confronted with an economic recession. Sales: In 2008 the Sioen Industries group realized sales of EUR million, compared with EUR million in 2007 (-8%). This fall is due entirely to the economic slowdown in the last quarter of the year. Gross margin: the total gross margin fell slightly compared with 2007, reflecting a shift sales mix and peak prices of basic raw materials and energy, despite improved production efficiency and the use of alternative materials. Services and other goods: a rigorous effort to rein in costs produced an approximately EUR 2.2 million fall in general expenses. Other operating expenses: these consist mainly of a number of non earnings-related taxes (property tax, taxe professionnelle, etc.), which become more onerous from year to year. Recurrent EBIT (REBIT): REBIT for 2008 amounted to EUR 21.4 million compared with EUR 40.3 million in This EUR 18.9 million fall is almost entirely due to the reduced sales volume. Press release Sioen Industries Embargo - 19/03/09 - after market closing Page 1

2 Non-recurrent costs: non-recurrent costs amounted in 2008 to EUR 5.3 million. The majority of these can be ascribed to the start-up of a new foil production plant (pond foils, industrial foils, etc.), which was completed in the course of the fourth quarter. Added to this is the cost of the restructuring measures introduced as an immediate response to the drop in demand in the fourth quarter. EBIT: the above-mentioned facts resulted in an EBIT of EUR 16.1 million compared with EUR 38.8 million in Financial result: financial costs during 2008 amounted to EUR 9.5 million compared with EUR 8.4 million in In addition to interest charges of EUR 7.5 million, the group recorded EUR 1.0 million of realized and EUR 1.0 million of unrealized exchange rate losses. The very sharp fall in the British pound and the continuous upward revaluation of the Polish zloty are the main factors here. Profit: group pre-tax profit for 2008 amounted to EUR 6.5 million compared with EUR 30.4 million in Net profit for 2007 amounted to EUR 3.4 million compared with EUR 19.2 million in The fact that the effective tax rate was higher than the normal tax rate is due to the reversal of latent tax assets, as a result of the economic recession. Net cash flow: net cash flow for 2008 amounted to EUR 24.2 million. Dividend: the Board of Directors will be proposing to the General Meeting that it declare a dividend equal to 50% of the net profit for the financial year. The proposed dividend for the 2008 financial year amounts to EUR 0.08 per share. Press release Sioen Industries Embargo - 19/03/09 - after market closing Page 2

3 COATING DIVISION The coating division specializes in the integrated coating of technical textile, of which it masters the entire production process from the extrusion of the technical yarns to the weaving of the technical fabric and its coating with various polymers. The group is the only player in the world with full proficiency in five different coating technologies, each with its own specific products and markets. Sioen Coating Full year EUR ' % change Sales 178, , % External sales 153, ,241 Intersegment sales 25,338 30,989 EBITDA 24,318 38, % % of sales 13.6% 19.1% EBIT 11,055 26, % % of sales 6.2% 13.2% - Spinning and weaving: In the spinning mill we extrude polyester granules into yarns. In 2008 we began developing and producing special to-measure yarns for external customers. The weaving mills (producing largely for internal use) followed the trend of the direct coating products. Here too we went looking for alternatives that we wish to market in Direct coating: from the second half onwards, and in particular in the last quarter, the transportation market experienced a sudden and general downturn. This immediately affected Sioen s sales in this market. Our market share, however, remained unchanged. - Online coating: last year we doubled production capacity to meet the strongly rising demand for open structure textiles (reinforcement nets, windbreak nets, geotextiles). We also grew strongly in reinforcement netting for PVC roofing. - Transfer coating: with a number of new developments enabling us to win several large contracts, we looked well on the way to posting attractive growth figures. The slowing in the automobile sector in the fourth quarter meant that we recorded a slight decline on an annual basis. - Extrusion coating: oil booms, technical ventilation piping, soil remediation fabric and swimming pool covers form a relatively stable market. - Calendering: by the end of the year the start-up phase was behind us and we are now optimising the final product range. The focus is primarily on industrial foils for various markets (pool foils, dashboard films etc.). We maintained our market shares in our existing segments and are rapidly developing new products with which to tap new markets (e.g. biogas containers). On top of this, thanks to the efforts of our commercial-technical people and the R&D team, we were able to extrude new yarn types in our spinning mills. Press release Sioen Industries Embargo - 19/03/09 - after market closing Page 3

4 This and the knowledge that our production apparatus is up-to-date and functioning perfectly make us optimistic for the future. For the coming years we will be focusing on R&D, continuous product and process improvements, production efficiency and market penetration. APPAREL DIVISION This division stands for technical protective clothing. Points of particular attention and certainly also the keys to our success in 2008 included our focus on technical design, attention to specific customer needs, rapid development of new products and additional attention to quality. Sioen Apparel Full year EUR ' % change Sales 77,019 69, % External sales 77,013 69,924 Intersegment sales 6 5 EBITDA 8,640 10, % % of sales 11.2% 15.1% EBIT 7,922 7, % % of sales 10.3% 11.2% The Apparel division continued to concentrate on the technical design and quality of all its products. These efforts were rewarded with growth of more than 10%. - We won significant tenders with recently developed product lines (technical protective clothing for firefighters, forestry, police forces, etc.). - Right across Europe companies expressed their appreciation of Sioen s innovative protective clothing, resulting in a number of new contracts. - Well-known sports clothing brands also recognized Sioen s know-how with new contracts. All this left its mark on the earnings figures, with an EBITDA of EUR 8.6 million and an EBIT of EUR 7.9 million. Press release Sioen Industries Embargo - 19/03/09 - after market closing Page 4

5 CHEMICALS DIVISION Sioen Chemicals Full year EUR ' % change % Sales 55,174 63, % External sales 46,903 54,165 Intersegment sales 8,271 9,713 EBITDA 2,055 7, % % of sales 3.7% 11.5% EBIT -2,231 2, % % of sales -4.0% 4.4% Sioen Chemicals processes basic raw materials (PVC powders, pigments, etc.) into high quality technical semi-finished products (pigment pastes, UV inks, varnishes, dispersions, flame retardant products, etc.) for a whole range of applications. An activity that was formerly limited to the production of raw materials for internal use is now a separate division within the Sioen Industries group with fast-growing external sales. Through a number of targeted takeovers (in 2007), the Chemicals division has succeeded in diversifying in various geographical and technical product markets. Our results were impacted in 2008 by shrinking demand from the textiles sector, offset, albeit only in part, by strong performance in our other markets. In addition, the margins of the Chemicals division came under heavy pressure during the first 9 months of the year from high and constantly rising raw materials prices (oil derivatives and energy). In this division too, R&D is a decisive factor for future growth. Rapidly development of special tomeasure products and product optimization are among our priorities. In the past year we laid the foundations for the future. We are convinced that we have the right longterm strategy, which will result in added value for our shareholders. DIVISION INDUSTRIAL APPLICATIONS The division Industrial Applications processes coated fabrics and PVC film for heavy-duty applications. The decline in the car and transportation industry had an immediate and heavy impact on this division s results. The majority of the sales of the division Industrial Applications consists of laser cutting of airbags and interior trim for the car industry, and the production of trailer tarpaulins, roofs and curtains. Press release Sioen Industries Embargo - 19/03/09 - after market closing Page 5

6 - Transportation: this sector produces trailer, container and railway curtains and tarpaulins. Under pressure from the sudden, sharp downturn in the transportation sector, the group decided to undertake a radical restructuring in all subsidiaries of the division in order to secure the future. - Manufacturing: attractive results were recorded in both the non-wovens department and in the other industrial activities. We invested in a new cutting machine and built a new hall to permit the even more efficient cutting and welding of pool foil. Sioen Industrial Applications Full year EUR ' % change Sales 74,672 89, % External sales 72,193 85,995 Intersegment sales 2,479 3,666 EBITDA 2,004 4, % % of sales 2.7% 5.1% EBIT , % % of sales -0.2% 2.6% OUTLOOK The current macro-economic situation makes it difficult to look ahead. We are working hard to defend our market positions and maintain rigorous cost control. We are closely following all new developments in our markets and are confident that, with our flexibility and our financial and shareholder structure, we will emerge stronger from this period. Press release Sioen Industries Embargo - 19/03/09 - after market closing Page 6

7 ANNEXES All figures and tables given in this press release have been prepared in accordance with the recognition and valuation principles of the International Financial Reporting Standards as accepted by the European Union. The valuation principles, as given in the latest available annual report (31 December 2007), have been consistently applied to the figures given in this press release. Risk management is analysed in the annual report, which will be available on Sioen Industries Group Full year EUR ' % vs 2007 Net sales 349, , % Other operating revenue 3,918 5,599 Total operating revenue 353, , % Cost of goods sold 182, ,798 Gross margin (1) 49.7% 51.8% Services and other goods 58,188 60,357 Personnel costs 71,746 72,586 Depreciation, amortization, impairments 20,601 20,330 Valuation allowances on inventory and trade receivables 101 2,265 Provisions for liabilities and charges Other operating costs 6,600 6,884 Non-recurrent costs (6) 5,292 1,500 Total operating costs 337, , % Operating result 16,060 38, % Financial result -9,541-8, % Result before taxes 6,519 30, % Taxes -3,114-11,234 Net profit 3,406 19, % Net profit (share of the group) 3,406 19,186 Net cash flow (7) 24,163 43, % EBITDA (3) 37,669 61, % % of sales 10.8% 16.1% EBIT (2) 16,060 38, % % of sales 4.6% 10.2% REBIT (4) 21,352 40, % REBITDA (5) 41,095 62, % Earnings per share Number of shares outstanding: 21,391,070 21,391,070 Earnings per share - ordinary Earnings per share - diluted Press release Sioen Industries Embargo - 19/03/09 - after market closing Page 7

8 Consolidated balance sheet EUR ' Total assets 371, ,112 Non-current assets 191, ,917 Current assets 179, ,195 Inventories 99,183 90,450 Trade receivables 56,107 73,208 Net financial debt 151, ,948 Shareholders equity including minority interest 142, ,585 (1) (Sales cost of goods sold)/sales) (2) Earnings Before Interest & Taxes = Operating Result (3) Earnings Before Interest, Taxes, Depreciation and Amortization = operating profit + depreciation/amortization + provisions for liabilities and charges + impairment losses (4) EBIT + non-recurrent costs (5) EBITDA + non-recurrent costs (6) Provision for internal restructurings + start-up costs of new production line (7) Net profit + depreciation/amortization + provisions for liabilities and charges + impairment losses COMMENTS ON THE FINANCIAL STATEMENTS The past year splits into two distinct parts. During the first three quarters we were well on the way to equalling the sales of our 2007 record year. Then, in the fourth quarter, the industrial world was confronted with an economic recession. Sales: In 2008 the Sioen Industries group realized sales of EUR million, compared with EUR million in 2007 (-8%). This fall is entirely ascribable to the economic slowing in the last quarter of the year. Gross margin: the total gross margin fell slightly compared with 2007, reflecting a shift in sales mix and peak prices for basic raw materials and energy, despite improved production efficiency and the use of alternative materials. Services and other goods: a rigorous effort to rein in produced an approximately EUR 2.2 million fall in general expenses. Other operating expenses: these consist mainly of a number of non earnings-related taxes (property tax, taxe professionnelle, etc.), which become more onerous from year to year. Recurrent EBIT (REBIT): REBIT for 2008 amounted to EUR 21.4 million compared with EUR 40.3 million in This EUR 18.9 million fall is almost entirely due to the reduced sales volume. Press release Sioen Industries Embargo - 19/03/09 - after market closing Page 8

9 Non-recurrent costs: non-recurrent costs amounted in 2008 to EUR 5.3 million. The majority of these can be ascribed to the start-up of a new foil production plant (pond foils, industrial foils, etc.), which was completed in the course of the fourth quarter. Added to this is the cost of the restructuring measures introduced as an immediate response to the drop in demand in the fourth quarter. EBIT: the above-mentioned facts resulted in an EBIT of EUR 16.1 million compared with EUR 38.8 million in Financial result: financial costs during 2008 amounted to EUR 9.5 million compared with EUR 8.4 million in In addition to interest charges of EUR 7.5 million, the group recorded EUR 1.0 million of realized and EUR 1.0 million of unrealized exchange rate losses. The very sharp fall in the British pound and the continuous upward revaluation of the Polish zloty are the main factors here. Profit: group pre-tax profit for 2008 amounted to EUR 6.5 million compared with EUR 30.4 million in Net profit for 2007 amounted to EUR 3.4 million compared with EUR 19.2 million in The fact that the effective tax rate was higher than the normal tax rate is due to the reversal of latent tax assets as a result of the economic recession. Net cash flow: net cash flow for 2008 amounted to EUR 24.2 million. Dividend: the Board of Directors will be proposing to the General Meeting that it declare a dividend equal to 50% of the net profit for the financial year. The proposed dividend for the 2008 financial year amounts to EUR 0.08 per share. STATEMENT BY THE AUDITOR The statutory auditor has confirmed that its auditing work, which is fundamentally complete, has not revealed the need for any significant corrections to the accounting information contained in the press release. Barring changes in circumstances in the intervening period, the statutory auditor intends to certify the consolidated financial statements without qualifications. 18 March 2009 The Statutory Auditor DELOITTE Bedrijfsrevisoren BV ovve CVBA Represented by Dirk Van Vlaenderen and Kurt Dehoorne Press release Sioen Industries Embargo - 19/03/09 - after market closing Page 9

10 PROFILE OF SIOEN Sioen Industries is a leading world producer of coated technical textiles, a market leader in industrial protective clothing, a niche specialist in fine chemicals and a major world player in processing technical textiles into semi-finished products and technical end products. Detailed information can be found on FINANCIAL CALENDAR Friday 24 April 2009: General Shareholders Meeting Friday 15 May 2009: Trading update, 1 st quarter 2009 Friday 28 August 2009: Announcement of half-yearly results for 2009: Friday 30 October 2009: Trading update, 3 rd quarter 2009 For further information/financial information/investor relations Geert Asselman, CFO Sioen Industries n.v. Fabriekstraat 23, B-8850 Ardooie Tel. 051/ / Fax 051/ corporate@sioen.be Website: Financial servicing is provided by KBC, Fortis, ING, Dexia and Bank Degroof. Press release Sioen Industries Embargo - 19/03/09 - after market closing Page 10