R. STAHL posts new record level of order intake

R. STAHL posts new record level of order intake

• Sales and EBIT further accelerating in third quarter
• Order intake in first nine months rises to new all-time high of EUR 252.8 million
• Sales stable on nine-month basis - up by 3.7% in third quarter
• EBIT of EUR 13.0 million driven by strong third quarter
• Guidance for current fiscal year confirmed

Waldenburg, 6 November 2014. The R. STAHL Group picked up momentum in the third quarter and achieved further growth in order intake, sales and earnings. The Group was thus able to successfully leave behind a first half-year marked by special situations and to refocus on its growth trajectory. This was illustrated in particular by earnings before interest and taxes (EBIT), which more than doubled compared to the first half of the year. R. STAHL posted EBIT of EUR 13.0 million in the first nine months (previous year: EUR 19.3 million). At EUR 252.8 million (previous year: EUR 232.2 million), order intake reached a new all-time high. Sales made solid progress over the first nine months; adjusted for currency effects, they increased by 2.8%.

"In the third quarter, we were able to concentrate fully on our operating business again and pursue our growth and efficiency programmes. The first benefits can be seen from third quarter earnings, which doubled the amount posted for the first six months," stated Martin Schomaker, CEO of R. STAHL AG. "We are very well prepared for further growth: order intake is up 9% on the previous year and has set another all-time high. As of the second half of the year, revenues have begun to catch up with this trend."

All-time high order intake at over EUR 252 million
In the first nine months of 2014, R. STAHL obtained a number of major orders in the face of stiff competition and raised order intake by 8.8% to EUR 252.2 million; adjusted for currency fluctuations, order intake exceeded the prior-year figure by as much as 11.6%. There was strong demand for R. STAHL products from the energy sector with growing interest in particular for equipment for specialist ships such as Floating Production Storage and Offloading Units (FPSO). Demand was also buoyant in the chemicals and pharmaceuticals industries.

In terms of geographical development, the most dynamic trend was recorded in the Asia/Pacific region with growth in order intake of 55.9% to EUR 55.5 million (EUR 35.6 million). In the Americas, order intake rose by 18.5% to EUR 44.7 million (EUR 37.7 million), driven above all by strong demand in the USA; in view of the economic and political uncertainties in South America, however, business here was disappointing. In Germany, order intake amounted to EUR 50.9 million as of 30 September 2014 (EUR 51.5 million) and in Europe (excluding Germany) it reached EUR 101.7 million (EUR 107.4 million). Against the backdrop of the Crimean crisis, falling demand was recorded above all in Eastern Europe and Russia. In Norway demand has slowed down as well.

Strongest revenue growth in Asia/Pacific
In the third quarter, R. STAHL was able to compensate for delayed revenues, which largely resulted from weak demand in the second half of 2013. Long-term orders gained over the past quarters have now been invoiced. In addition, there was an increase in short-term orders with faster revenue recognition. Following the usual delay, there was therefore a gradual increase in sales, which led to revenue growth of 3.7% in the third quarter. Total sales after the first nine months of 2014 amounted to EUR 227.1 million (EUR 226.0 million), corresponding to an increase of 0.5%. Based on exchange rates of the previous year, revenue growth amounted to 2.8%. In the first nine months of 2014, 78.0% (79.0%) of total sales were generated outside Germany.

Thanks to the strong order position of the previous year, sales revenues in Germany rose by 5.2% to EUR 50.0 million (EUR 47.5 million). In Europe (excluding Germany), revenues fell by 3.9% to EUR 99.8 million (EUR 103.8 million). At EUR 36.1 million (EUR 36.5 million) revenues in the Americas were 1.3% below the prior-year figure. While sales in South America were down year on year, business in the USA continued to grow. The expansion of the company's Houston facility led to faster delivery times and provided customers with further good reasons to choose R. STAHL. By optimizing its sales concept in the USA, the company is now receiving an increasing number of orders from OEM providers.

Over the first nine months of the year, the Asia/Pacific region achieved revenue growth of 8.2% to EUR 41.3 million (EUR 38.2 million). This was largely due to a strong development in the third quarter as well as to the processing of major orders for an oil platform 100 km off the coast Sabah (Malaysia) and a liquefied natural gas project in Australia. Further dynamic growth is expected in this region over the coming months from such large-scale projects as the provision of equipment for an offshore platform near Brunei and power distribution systems for an oil production facility in the world's fourth-largest oil field off the coast of Abu Dhabi.

Improved earnings in the third quarter
Whereas earnings in the first six months were burdened by special items connected with the company's investment programme and its defence against the takeover bid, profitability improved again in the third quarter. Earnings before interest and taxes (EBIT) of EUR 5.6 million for the first half of the year were more than doubled on a nine months basis: in absolute figures, EBIT of EUR 7.5 million (EUR 7.6 million) in the third quarter fell just short of the prior-year figure. R. STAHL posted an EBIT result of EUR 13.0 million (EUR 19.3 million) for the first nine months. The year-on-year decline reflects two major factors: firstly, fending the takeover bid and secondly, start-up costs incurred in connection with the expansion of business which had not yet been translated into increased revenues.

CFO Bernd Marx commented: "Our earnings trend in the past quarter demonstrates that our investments are beginning to pay off and that our expanded operating platform has laid the foundation for further profitable growth. We shall now build on the success of the third quarter and work hard to achieve further improvements in our profitability."

The EBIT margin for the first nine months of 2014 amounted to 5.7% (8.6%). Earnings before taxes (EBT) reached EUR 10.4 million (EUR 16.7 million) with an EBT margin of 4.6% (7.4%). Earnings per share fell from EUR 1.96 to EUR 1.23.

Guidance confirmed
In the first nine months of 2014, the R. STAHL Group invested EUR 13.5 million (EUR 15.4 million) in non-current assets. The investment programme launched in 2012 is still impacting cash flow in 2014. The majority of expansion projects has now been completed, however. In Waldenburg, the extension of the new research and development centre is already in its final stages; the laboratory and basic research departments were the first to move into the new premises. Development staff will follow by the end of the year. In the third quarter, building work was started in Cologne on a joint development and production centre for the subsidiaries R. STAHL HMI Systems GmbH and R. STAHL Camera Systems GmbH.
The new LED lighting range was launched in the third quarter after previously being postponed due to the takeover bid.

R. STAHL expects strong regional differences in economic growth over the coming months. Due to the political uncertainties in Russia and Eastern Europe, business in this region is likely to be sluggish. The falling oil price may also affect the investment decisions of energy corporations in certain areas. In the USA and the Asia/Pacific region, R. STAHL expects further strong demand and high utilisation of capacity.

Although the fourth quarter is traditionally not as strong as the third, the company confirms its guidance for the fiscal year 2014: R. STAHL is targeting an order intake of EUR 325 million to EUR 335 million and revenues of EUR 315 million to EUR 325 million. We are still confident of reaching our forecast range for EBIT of EUR 18.0 million to EUR 22.0 million. The medium-term forecast, which extends to the end of fiscal year 2016, also remains valid.

Conference Call
R. STAHL AG is pleased to invite all interested analysts, investors and media to participate in the quarterly results conference call to be held on 6 November 2014 at 10:00 a.m. (CET). The telephone conference will be held in English language. Please dial the following number to join the call: +49 69 94184017. Additionally to the call, we will provide a presentation online. Please log on as a participant entering eventmanager.meetyoo.de, insert your full name and the following PIN: 57875189. An audio cast of the call will be available thereafter on the company's website:
www.r-stahl.com/investor-relations/presentationsrecordings.html

Key Figures of R. STAHL Group according to IFRS

The full report for the first nine months of 2014 is available on the Company's website www.stahl.de for download.

Financial Calendar 2014

13 November LBBW German Company Day, London
25/26 November Deutsche Boerse Equity Forum, Frankfurt

About R. STAHL - www.stahl.de
R. STAHL is one of the world's leading suppliers of electrical and electronic products and systems for explosion protection. These products and systems prevent explosions in risk 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 growth industries, such as the oil & gas industry, the chemical and pharmaceutical industries, and the food industry. Approximately 1,870 employees generated worldwide sales in 2013 of EUR 304 million. R. STAHL AG shares are traded on the Regulated Market/Prime Standard of Deutsche Boerse (ISIN DE000A1PHBB5).

For further information:
R. STAHL AG
Am Bahnhof 30, 74638 Waldenburg (Württ. )

Bernd Marx (CFO)
Phone: +49 7942 943-1271

Nathalie Dirian (Investor Relations)
Phone: +49 7942 943-1395

e-mail: [email protected]