R. STAHL, leading supplier of products and systems for explosion protection, today publishes the results for the first three quarters in 2016:
- Order intake reached EUR 215.5 m (previous year: EUR 243.0 m)
- At EUR 213.3 m, sales was according to plan (previous year: EUR 237.7 m)
- Earnings before interest and taxes (EBIT) amounted to EUR 6.7 m (previous year: EUR 8.4 m), EBIT margin was 3.2% (previous year: 3.5%)
From July to September 2016, the market situation did not change. The oil price level was low, in a range of USD 40 to 50 per barrel of Brent. The oil producing industry and then increasingly also the oil processing industries reacted to the increased pressure and the reduced margins in the refinery business. R. STAHL made use of the third quarter 2016 to expand its global presence. With the acquisition of an interest of 25% in ZAVOD Goreltex, number two in the Russian explosion protection market, R. STAHL will gain an easier access to the Russian market. The German company anticipates that especially automation technology may be put on the market, as those part of the product portfolio is neither manufactured locally nor is it subject to an embargo. In addition, R. STAHL acquired 35% in its long-standing sales partner, South-African company ESACO Pty. Ltd. The reasons for the decision to be present on the African continent as well are the large investment projects that are planned for the coming years in countries like Namibia, Mozambique, Angola or Nigeria. Together with the South-African partner, the market development in the region south of the Sahara will be pushed, to continue the success we have experienced in the past years.
Order intake without major projects
On 30 September 2016, order intake was EUR 46.6 m in Germany (previous year: EUR 52.8 m). In Europe (excl. Germany), order intake at EUR 99.9 m exceeded the previous year's value by 3.5% (previous year: EUR 96.5 m). R. STAHL could win orders for terminal boxes and lighting technology for a project to modernize and develop a refinery on the Polish Baltic coast. In addition, the efforts of the expert in explosion protection to expand the customer basis outside the oil and gas industry yielded results: In the third quarter of 2016, a new customer from the chemical industry could be won, who will utilize R. STAHL products in a new fertiliser plant. However, in the Americas the market is still burdened by the continuously low oil prices and the resulting stop to investments of the big companies in the oil and gas sector. This development is reflected in R. STAHL's order intake: At EUR 25.6 m, order intake in this region was 27.2% below last year's value (previous year: EUR 35.1 m). Viewed in isolation, it was the strongest quarter in 2016 in region Asia/Pacific; however, order intake did not reach previous year's level. On 30 September 2016, order intake for region Asia/Pacific amounted to EUR 43.3 m (previous year: EUR 58.6 m). The weak order intake is mainly due to the delay in awarding projects. On 30 September 2016, order backlog of R. STAHL Group amounted to EUR 91.1 m (previous year: EUR 97.1 m). Compared to 30 June 2016, when the backlog amounted to EUR 100.0 m, some major call-forward notices for long-term projects could be delivered and invoiced.
Sales revenues below last year's level, with the exception of Europe
In the period under review, sales amounted to EUR 213.3 m and was thus 10.3% below last year's value. In Germany, sales revenues declined by 4.7% to EUR 46.4 m in the first three quarters of 2016 (previous year: EUR 48.9 m).In Europe (excl. Germany), however, sales amounted to EUR 98.0 m and thus exceeded previous year's value by 3.1% (previous year: EUR 95.1 m). Substantial long-term project orders could be completed and delivered in the third quarter of 2016. In the Americas, R. STAHL had to suffer the sharpest drop in sales: At EUR 27.1 m, sales revenues in this region were 30.9% below the value in the comparison period (previous year: EUR 39.2 m). The continuously low oil price still paralyzed the oil and gas industry, as well as the subsequent industry sectors. In region Asia/Pacific, the weak demand in the past months could be felt in sales. R. STAHL could not continue the growth we achieved in this region in the past year. Sales revenues in Asia/Pacific amounted to EUR 41.7 m, which is 23.7% less than last year (previous year: EUR 54.6 m).
EBIT affected by the tense market situation
At the beginning of the oil price crisis, especially companies in the oil and gas production industry were affected; now the lower margins in the refinery business increasingly also affect the subsequent industry sectors. This customer group now reacts with savings programmes and the postponement of projects to the rising pressure. The consequences can be clearly felt on the explosion protection market: order volume decreases, price pressure increases, competition grows. This development is reflected in the profit situation of R. STAHL and reduces the Group's margins, which could only in parts be compensated by the savings in personnel expenses and material costs. In addition, the altered regional composition of sales revenues had a negative influence on the profit situation of the company. In the half-year report 2016, R. STAHL informed about the change in regard to the product mix. This change could also be noticed in the months July to September 2016: while the demand for high-margin products was weaker, sales achieved with low-margin products increased. This development could only partly be compensated by the strong LED business. On 30 September 2016, R. STAHL's EBIT amounted to EUR 6.7 m (previous year: EUR 8.4 m). EBIT margin based on sales revenues amounted to 3.2% (previous year: 3.5 %). The Group's EBT amounted to EUR 4.5 million (previous year: EUR 6.3 m), EBIT margin was 2.1% (previous year: 2.6%). Result after taxes amounted to EUR 3.0 m (previous year: EUR 3.9 m).
Equity burdened by increased pension obligations
As at 30 September 2016, R. STAHL's equity ratio decreased to 30.0% (31 December 2016: 36.2%). While the consolidated surplus increased equity by EUR 3.0 m, payment of the dividend, EUR 3.9 m, and the increased provisions for pension obligations reduced the amount to EUR 87.2 m (31 December 2015: EUR 101.0 m). The reason for the renewed rise of pension provisions is the lower interest rate, which is 1.33% as at 30 September (31 December 2015: 2.42%). For a detailed information on the actuarial interest rate, please refer, for example, to the website of Mercer Deutschland GmbH: http://www.mercer.de/our-thinking/rechnungszins-fuer-ifrs-us-gaap-bilmog-bewertungen.html. On 30 September 2016, the balance sheet total amounted to EUR 290.5 million (31 December 2015: EUR 278.8 m).
The third quarter of 2016 was weak, particularly due to the pricing pressure of the customers from the downstream sector, due to the altered product mix and due to the regional composition of the Group sales. Postponement of projects additionally weakened R. STAHL's order intake. However, the Executive Board is confident that some of the postponed projects will be awarded during the fourth quarter of 2016 and will generate order intake for R. STAHL. R. STAHL actively expands its global presence to be able to supply customers locally and to support them in finding solutions. In addition, the company continuously strengthens its business in other sales sectors. Furthermore, the product portfolio will be enhanced, with a focus on new innovations, to win new customers and to develop new markets. This way, R. STAHL makes use of the current situation to position itself strategically for the growth in the future.
Due to the siginifcantly higher pricing pressure and due to the altered product mix and the regional composition of the Group's sales revenues, R. STAHL's profit situation deteriorated significantly in the third quarter of 2016, against expectations. For the fourth quarter, the margins are not expected to improve. The savings measures in regard to personnel expenses and material costs that have been implemented cannot completely compensate for this decline. The Executive Board thus adjusts the forecast for the full year 2016. For order intake and sales, the Executive Board anticipates unchanged values between EUR 275 m and EUR 285 m. The current EBIT forecast is EUR 6 m to EUR 8 m (until now: EUR 11m to EUR 15 m). So the forecast corridor for the EBIT margin will amount to 2% to 3% (until now: 4% to 5%). Telephone conference R. STAHL AG invites all interested analysts, investors and journalists to join the Q3 telephone conference on 10 November 2016 at 10 a.m. Please dial one of the following telephone numbers:
DE: +49 6922 222 9043 UK: +44 2030 092 452 USA: +1 8554 027 766
The telephone conference will be supplemented by an online presentation. Please log in under http://www.audio-webcast.com/cgi-bin/login.ssp?fn=verify_user&curPassword=rstahl1116 as a participant and enter your first name and your surname, your company and the confirmation code 16790194#.
A recording of the conference will subsequently be made available on the company website under http://www.stahl.de/investor-relations/praesentationenmitschnitte.html.
The major key figures of R. STAHL Group
pursuant to IFRS
| ||Q1-3 2016 in EUR m||Q1-3 2015 in EUR m||Change in %|
|Sales, total||213.3||237.7||- 10.3|
|Europe, excl. Germany||98.0||95.1||+ 3.1|
|Asia / Pacific||41.7||54.6||- 23.7|
|Order intake||215.5||243.0||- 11.3|
|Order backlog||91.1||97.1||- 6.2|
|EBITDA margin (in %)||7.5||7.7|| |
|EBIT margin (in %)||3.2||3.5|| |
|EBT (earnings before taxes)||4.5||6.3||- 28.0|
|EBT margin (in %)||2.1||2.6|| |
|Period surplus||3.0||3.9||- 24.8|
|Earnings per share (in EUR)||0.45||0.61||- 26.2|
|Operating cash flow||5.1||10.8|| |
|Employees as at 30.06. (excl. trainees)||1,807||1,946||- 7.0|
| || || || |
| ||30.09.2016||31.12.2015|| |
| || || || |
|Liquid funds||14.3||18.3||- 21.9|
|Equity ratio (in %)||30.0||36.2|| |
The full report on the first three quarters of 2016 is available for download on the company's website www.stahl.de.
Financial calendar 2017
21 April annual report 2016
09 May interim report as at 31 March 2017
02 June annual general meeting
03 August interim report as at 30 June 2017
09 November interim report as at 30 September 2017
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 growth industries, such as the oil & gas industry, the chemical and pharmaceutical industry and the food industry. In 2015, global sales amounting to EUR 312.9 million were generated with 1,894 employees. The shares of R. STAHL AG are traded on the Regulated Market/Prime Standard of Deutsche Boerse (ISIN DE000A1PHBB5).
R. STAHL AG
Am Bahnhof 30, 74638 Waldenburg (Württ.)
Bernd Marx (CFO)
Phone: +49 7942 943 1271
Carmen Kulle (Investor Relations)
Phone: +49 7942 943 1395
E-Mail: [email protected]
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