- Net profit increases significantly to EUR 4.2 million
- Slump in demand in the oil & gas sector leads to a decline of order intake by 10.8 % to EUR 282.9 million and a decline in sales by 8.4 % to EUR 286.6 million
- Dividend proposal of EUR 0.60 per share continues shareholder-friendly dividend policy
- Basis for future growth established
- Refinement of guidance for FY 2017
R. STAHL, leading supplier of products and systems for explosion protection, today publishes the audited results for fiscal year 2016. Compared to the preliminary figures that were published on 22 February 2017, order intake and sales remain unchanged, while earnings before interest and taxes (EBIT) increase slightly by EUR 0.4 million to EUR 8.8 million, mainly due to the capitalization of acquisition costs.
In the year under review, R. STAHL maintained profitability in a difficult market environment and expanded its market position, despite declining sales. While order intake dropped by 10.8 % compared to the previous year and achieved
EUR 282.9 million (2015: EUR 317.3 million), sales declined by 8.4 % to
EUR 286.6 million (2015: EUR 312.9 million). However, EBIT more than doubled to EUR 8.8 million (2015: EUR 3.9 million). Similarly, earnings before taxes (EBT) significantly increased to EUR 5.8 million (2015: EUR 0.7 m), and net profit reached EUR 4.2 million (2015: EUR -0.1 million).
The decline in order intake and sales in FY 2016 was driven by the renewed slump in demand in the main customer sector of R. STAHL, the oil & gas sector. Due to the repeated severe drop in prices for oil & gas, particularly at the beginning of the year, oil & gas producers stopped their investments almost completely. As of the second half of the year, companies in the downstream sector also reacted with similar measures to the low price level for oil & gas. Besides low sales volumes, R. STAHL also had to cope with increased pricing pressure.
From a regional perspective, there were significant differences in the development of order intake. In total, however, order intake declined in all regions. In Germany, order intake fell by 10.4 % to EUR 61.6 million (2015: EUR 68.7 million). Major projects have not been awarded in the year under review. In the Central region - which includes Africa and Europe, excl. Germany - order intake at EUR 126.8 million was 2.0 % below the previous year's figure (2015: EUR 129.4 million). Among other things, the measures to win new customers in the chemical sector made a positive impact here. In the Americas, the precarious market situation increasingly worsened in the course of the year while the investment restraint of the oil & gas producers expanded into the downstream sector. Order intake in this region achieved EUR 34.3 million and was thus below previous year's level by 19.1% (2015: EUR 42.5 million). In the Asia/Pacific region, R. STAHL could also not keep up to the previous year's level of order intake. Here, a decline of 21.5 % to EUR 60.2 million was recorded (2015: EUR 76.7 million). Due to high pricing pressure in the oil & gas industry, particularly larger projects in the downstream sector have been postponed several times. At the end of 2016, order backlog was at EUR 80.7 million and thus 15.2 % below the level of last year's end (2015: EUR 95.2 million).
Due to the reduced order intakes in 2016, sales in the R. STAHL Group also declined. At EUR 286.6 million, sales were 8.4 % lower compared to the previous year (2015: EUR 312.9 million). Besides a decline in prices and volumes and a change in product mix, adverse changes in FX rates also held back sales. In Germany, the weak demand in the oil & gas sector was partly offset by sales in other industry sectors. Although the production and processing of crude oil does not play a major role here, however, our products that are sold in Germany are also applied in customer facilities abroad. At EUR 61.3 million (2015: EUR 64.3 million), sales in 2016 were 4.7 % lower than in the previous year. In the Central region, sales increased by 6.1 % to EUR 131.9 million (2015: EUR 124.4 million). While the contribution from the Scandinavian countries dropped significantly due to the high production costs in the North Sea area, sales in other countries in this region grew due to the delivery of large long-term projects. In the Americas we had to accept the sharpest drop in sales in 2016. Here, sales declined by 27.1 % to EUR 35.8 million (2015: EUR 49.1 million). The massive drop in drilling activities in the course of the year and the growing spread of investment restraint to the industry sectors that depend on the oil & gas industry considerably impaired business of R. STAHL. In Asia/Pacific, sales also declined significantly. Following strong growth in the previous year, we had to record a drop by 23.3 % to EUR 57.6 million in 2016 (2015: EUR 75.1 million).
Restructuring program and exceptionals support earnings
Compared to the previous year, EBIT more than doubled in 2016, despite the drop in sales, and achieved EUR 8.8 million (2015: EUR 3.9 million). The significant increase in EBIT compared to last year is driven by various factors. On the one hand, 2015's EBIT was burdened by exceptionals amounting to EUR 7.5 million in connection with the restructuring program initiated in the same year. On the other hand, the savings of this restructuring program took effect for the first time in 2016, which led to a permanent reduction of the cost basis by EUR 19.3 m compared to the previous year. Furthermore, higher other operating income, which increased to EUR 12.9 million (2015: EUR 10.9 million) and which was especially due to the sale of a piece of land that R. STAHL did not require and that was strategically of no importance, had a positive effect on the EBIT development in the year under review. These developments, which improved earnings, were partly offset by effects that reduce earnings, particularly pricing pressure, lower volumes and a change in product mix.
Dividend of EUR 0.60 per share proposed
Executive Board and Supervisory Board of R. STAHL AG will propose a dividend payment of EUR 0.60 per share for FY 2016 (FY 2015: EUR 0.60) at the Annual General Meeting in Neuenstein on June 2, 2017. This corresponds to a dividend yield of 2.1 % based on the closing price of the shares of R. STAHL at year-end. R. STAHL thus continues its shareholder-friendly dividend policy.
Basis for future growth established
In order to fuel future growth, R. STAHL promoted numerous strategic measures in the year under review. Besides an expansion of sales in areas outside the oil & gas sector, the company has reshaped the organization of its automation business to serve its customers more effectively. Moreover, with an investment in the Russian number two in explosion protection, ZAVOD Goreltex, the market presence in this important growth market was significantly strengthened. Finally, with an investment in South-African company ESACO Pty. Ltd, the conditions for a better development of the African market have been created.
Refined guidance for 2017
Along with the release of preliminary figures for 2016 on 22 February 2017, R. STAHL provided an initial outlook for FY 2017, expecting a slight increase in order intake, sales and EBIT pre exceptionals* compared to the previous year, with a weak first half, followed by a stronger second half.
The preliminary figures for the first quarter 2017 show the expected revival of demand in the oil and gas sector with an increase of order intake to EUR 75.8 million compared to the previous quarter (Q4 2016: EUR 67.4 million), as well as an increase of order backlog at the end of the first quarter 2017 to EUR 91.4 million (Q4 2016: EUR 80.7 million). In contrast, sales and earnings in the first quarter 2017 reflect the low order backlog at the end of 2016 and still lag behind the improving sentiment in the oil and gas sector. According to the preliminary figures for the first quarter 2017, R. STAHL has achieved sales of EUR 65.5 million (Q4 2016: EUR 73.3 million) and an EBIT pre exceptionals of EUR -3.1 million (Q4 2016: EUR 0.5 million). Devaluations of receivables and inventories amounting to EUR 0.9 million contributed negatively to EBIT in the first quarter 2017.
The business development in the first three months of the current year confirms that a precise forecast for FY 2017 is still accompanied by a high degree of uncertainty due to the still tense situation in the oil and gas sector. Although an upturn can be seen in order intake and order backlog, however, visibility is still low. Furthermore, sales realization still lags behind the development of order intake. As a consequence, development of sales and EBIT in FY 2017 will be delayed relative to the development of order intake. Against this backdrop, R. STAHL refines its forecast as follows:
For FY 2017, the Executive Board expects an order intake in a range between EUR 295 million and EUR 305 million. Sales should come in between EUR 285 million and EUR 295 million while EBIT pre exceptionals is expected to be in a range between EUR 3.5 million and EUR 7.5 million.
* exceptionals: non-scheduled depreciation, impairment reversals, proceeds from the sale of non-current assets, restructuring charges, costs from portfolio activities
Key figures of R. STAHL Group pursuant to IFRS
| EUR m | 2016 | 2015
| change
|
| Sales, total | 286.6 | 312.9 | - 8.4% |
| Germany | 61.3 | 64.3 | - 4.7% |
| Central region* | 131.9 | 124.4 | + 6.1% |
| Americas | 35.8 | 49.1 | - 27.1% |
| Asia/Pacific | 57.6 | 75.1 | - 23.3% |
| Order intake | 282.9 | 317.3 | - 10.8% |
| Order backlog | 80.7 | 95.2 | - 15.2% |
| EBIT (earnings before interest and taxes) | 8.8 | 3.9 | +>100% |
| EBIT in % of sales | 3.1 | 1.2 | |
| EBT (earnings before taxes) | 5.8 | 0.7 | +>100% |
| EBT in % of sales | 2.0 | 0.2 | |
| Net profit | 4.2 | -0.1 | n.m. |
| Earnings per share (in EUR) | 0.64 | -0.02 | n.m. |
| | | | |
| Investments in intangible assets and tangible assets | 12.5 | 23.0 | - 10.5 |
| Depreciation and amortization of intangible and tangible assets | 13.4 | 13.5 | - 0.1 |
| Operating cash flow | 10.9 | 18.4 | - 7.5 |
| Cash and cash equivalents | 16.2 | 18.3 | - 1.9 |
| | | | |
| Equity ratio (in %) | 34.0 | 36.2 | |
| Dividend per share (in EUR) | 0.60** | 0.60 | 0 |
| Employees on 31.12. (excl. trainees) | 1,788 | 1,894 | - 2.5 |
* Central region: Africa and Europe excl. Germany
** Dividend proposal to the Annual General Meeting on June 2, 2017.
As of April 21, 2017 the annual report for FY 2016 will be available for download on the company's website under stahl.de/investor-relations/finanzberichte.html.
Media conference call
Today at 10:00 CET, the Executive Board of R. STAHL AG will comment on the results of FY 2016 and give an outlook on the current fiscal year in a media conference call. Following the presentation, the management will be available for questions and discussions. The media conference call will be held in German language.
Please dial one of the following telephone numbers at the specified time and enter the Participant PIN as well as your first name, your surname and your company's name on request.
DE: +4969222229043
UK: +442030092452
USA: +18554027766
Participant PIN: 16790194#
The media conference call will be supplemented by a presentation via the Internet. Please log on the below-mentioned website and enter your first name and your surname, as well as your company's name:
Website: www.audio-webcast.com
Password: rstahl0417d
Direct link: http://www.audio-webcast.com/cgi-bin/login.ssp?fn=verify_user&curPassword=rstahl0417d
Investors' and analysts' conference call
Today at 14:00 CET, the Executive Board of R. STAHL AG will comment on the results of FY 2016 and give an outlook on the current fiscal year in an investors' and analysts' conference call. Following the presentation, the management will be available for questions and discussions. The investors' and analysts' conference call will be held in English language.
Please dial one of the following telephone numbers at the specified time and enter the Participant PIN as well as your first name, your surname and your company's name on request.
DE: +4969222229043
UK: +442030092452
USA: +18554027766
Participant PIN: 16790194#
Along with the conference call we will provide an online presentation via the internet simultaneously. Please log on as a participant with your full name and company under the following website:
Website: www.audio-webcast.com
Password: rstahl0417e
Direct link: http://www.audio-webcast.com/cgi-bin/login.ssp?fn=verify_user&curPassword=rstahl0417e
Financial calendar 2017
May 09 Interim report on the first quarter
June 02 Annual general meeting in Neuenstein
August 03 Interim report on the first half of 2017
November 09 Interim report on the third quarter
About R. STAHL - www.stahl.de
R. STAHL is the world's leading supplier of electrical and electronic products and systems for explosion protection. These products and systems prevent explosions in hazardous areas and contribute to the safety of people, machines and the environment. The portfolio ranges from products used in switching/distributing, installing, operating/monitoring, lighting and signalling/alarming up to automation. Typical customers operate in the oil & gas industry, the chemical and pharmaceutical industry and the food industry. In FY 2016, global sales amounting to EUR 286.6 million were generated with about 1,788 employees.
The shares of R. STAHL AG are traded on the Regulated Market/Prime Standard of Deutsche Boerse (ISIN DE000A1PHBB5).
Contact:
R. STAHL AG
Am Bahnhof 30, 74638 Waldenburg (Wuertt. )
Dr. Thomas Kornek
Head of Investor Relations & Corporate Communications
Phone: +49 7942 943-1395
E-mail: [email protected]
21.04.2017 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG.The issuer is solely responsible for the content of this announcement.The DGAP Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Archive at www.dgap.de
