RHI: Preliminary Results 2016
The RHI Group’s revenue amounted to EUR 1651,2 million in the past financial year compared with EUR 1752,5 million in the year 2015. This decline is primarily attributable to the continued moderate steel production and lower project deliveries in the business segments outside the steel industry.
The operating EBIT amounted to EUR 123,2 million in the past financial year and was maintained at the level of 2015 despite weak markets and one-off costs of roughly EUR 12 million related to the planned combination with Magnesita/BR. This positive operating business development is predominantly attributable to the good earnings situation in the Steel Division, the improved operating EBIT in the Raw Materials Division due to good capacity utilization at the Austrian raw material plants and cost reductions in all areas of the company.
EBIT amounted to EUR 116,1 million in the past financial year and includes a full impairment of the assets of the two production sites for fused cast products for the glass industry totalling EUR 8 million. Moreover, negative effects on earnings of EUR 4,6 million from the deconsolidation of the US subsidiary RHI Monofrax, LLC following its sale and EUR 4,8 million related to the social plan for personnel cuts and the reorganization of the production portfolio at the Norwegian site in Porsgrunn are included. In contrast, a positive effect of EUR 10,1 million resulted from the measurement of the power supply contract in Norway.
Sales volume in the Industrial Division declined by 3,4 % compared with the previous year and is attributable to lower deliveries in nearly all business units. The operating EBIT dropped from EUR 65 million in 2015 to EUR 44,5 million in the past financial year due to lower deliveries and the resulting weaker utilization of production capacities.
The Raw Materials Division’s external sales volume rose significantly from roughly 297 000 t in the previous year to roughly 342 000 t in the past financial year. The increase by 15,2 % is above all attributable to the increase in the sale of raw dolomite in Italy, which makes a large contribution in terms of volume. However, due to the low price per ton, the contribution in terms of value is minor. The operating EBIT turned around from EUR 5,2 million to EUR 2,5 million in the past financial year, mainly because of the good capacity utilization at the two Austrian raw material plants, which predominantly produce basic mixes for the steel industry, especially for the use in electric arc furnaces. This is an immediate effect of the Steel Division’s increase in sales volume in this product segment by more than 9 % compared with the previous year to more than 500 000 t.
RHI expects a more positive market environment in 2017. The focus will stay on the generation of free cash flow in the current financial year in order to reduce net debt further. RHI is currently working on meeting the conditions precedent to the successful closing of the planned combination with Magnesita and is preparing the integration of the two companies. In the context of these activities, external costs will be incurred.