Ringmetall increases EBITDA by around 14 percent in the first half year despite corona crisis

DGAP-News: Ringmetall Aktiengesellschaft / Key word(s): Half Year Results
17.09.2020 / 07:00
The issuer is solely responsible for the content of this announcement.

Ringmetall increases EBITDA by around 14 percent in the first half year despite corona crisis

- Group revenues increase by 0.9 percent to EUR 62.3 million in the first half year
- EBITDA increases by 13.6 percent to EUR 6.5 million; EBITDA margin improves to 10.3 percent
- Unchanged stable order situation in the third quarter

Munich, 17 September 2020 - Ringmetall AG (ISIN: DE0006001902), a leading international specialist supplier in the packaging industry, continued to grow in the first six months of 2020 despite the generally tense economic environment. The business development figures published today in the interim report for the first half of 2020 essentially correspond to the preliminary business figures published on 6 August 2020.

Consolidated net revenues increased by 0.9 percent to EUR 62.3 million in the first half of the year (H1 2019: EUR 61.8 million). The revenue growth was mainly driven by acquisition effects of the subsidiary Tesseraux, consolidated for the first time as of July 1, 2019, and the business activities of Sorini. At the same time, however, declining steel prices and purely organic business development had a slightly counteracting effect. Earnings before interest, taxes, depreciation and amortization (EBITDA) grew disproportionately by 13.6 percent to EUR 6.5 million (H1 2019: EUR 5.7 million). The EBITDA margin in relation to total operating performance increased accordingly and, at 10.3 percent, was back in the double-digit range. On the earnings side, cost management, which was very closely aligned with day-to-day business, had a particularly significant impact. As a result of a significant reduction in the proportion of temporary staff, it was possible to cut personnel costs significantly in the course of the COVID 19 pandemic without having to make cuts in the core workforce. Likewise, short-time working had to be used only to a very limited extent and very selectively in certain regions.

A separate analysis of the effects of steel price development, inorganic and organic growth showed the following effects on segment sales in the first half of 2020:

Industrial Packaging
- Effect of steel price development on segment revenue: - 5.3 percent
- Effect of corporate acquisitions on segment revenue: + 11.2 percent
- Effect of organic business development on segment revenue: -4.1 percent

Industrial Handling
- Effect of organic business development on segment revenue: -12.3 percent

The key preliminary figures for business development in the first half of 2020 are as follows:

in EUR '000 H1 2020 H1 2019 ∆ [abs.] ∆ [%]
Group revenues 62,320 61,764 556 0.9
Total Output (TO) 63,066 62,470 596 1.0
Gross profit * 30,169 28,609 1,560 5.5
Gross margin on TO 47.8% 45.8%    
EBITDA 6,495 5,718 777 13.6
EBITDA margin on TO 10.3% 9.2%    
EBIT 3,370 3,477 -107 -3.1
EBIT margin on TO 5.3% 5.6%    

*Gross profit defined as: Group revenues including changes in inventories less cost of raw materials, consumables and supplies as well as purchased services; purchased services H1 2019 reduced by cost of temporary workers (EUR 1.8 million), as this item will be reported under personnel expenses upon publication of the Annual Report 2019

Revenues in the Industrial Packaging segment rose by 2.4 percent to EUR 56.9 million (H1 2019: EUR 55.6 million). Segment EBITDA increased by 18.8 percent to EUR 7.4 million (H1 2019: EUR 6.2 million). In addition to the already mentioned consistent personnel cost management, the cost of materials ratio was also primarily improved as a result of reduced production waste, which had a positive effect on the division's earnings performance. The steadily increasing share of revenues of the inliner product category, which now accounts for around 18 percent of segment revenues, also meant that the order situation was noticeably less sensitive to economic trends. Furthermore, the first positive effects on earnings from the integration of the acquisitions made in 2019 into the Group, which went hand in hand with an optimization of corporate structures, were already evident.

In the Industrial Handling segment, the negative impact of the COVID 19 pandemic was more noticeable in a reduced order situation. Consequently, sales with a major customer in the industrial truck sector fell far short of expectations. On the cost side, however, it was also possible in this segment to adjust personnel costs in line with the order situation and thus contain the extent of the negative effects. Segment revenues decreased by 12.3 percent to EUR 5.4 million (H1 2019: EUR 6.1 million) while segment EBITDA decreased by 76.1 percent to EUR 0.2 million (H1 2019: EUR 0.8 million).

The Management Board still considers the forecast for the Company's development in the full year 2020 to be realistic. However, the significant decline in steel prices could - unless the trend reverses at least partially in the further course of the year - lead to Group revenues falling slightly short of expectations, although the Company's operating performance is certainly in line with expectations. However, this will not have a negative effect on earnings. At the current point in time, the Management Board therefore continues to expect consolidated sales of EUR 125 to 135 million and EBITDA of EUR 11 to 13 million for 2020.

The complete interim report for the first half of 2020 and further information on Ringmetall AG and its affiliated subsidiaries are available at www.ringmetall.de.

Ingo Middelmenne
Investor Relations
Ringmetall AG
Phone: +49 (0 )89 45 220 98 12
Mobile: +49 (0 )174 90 911 90
Email: middelmenne@ringmetall.de

About the Ringmetall Group
Ringmetall is an internationally leading specialist supplier in the packaging industry. The Industrial Packaging division offers high-security closure systems and inliners for industrial drums for the chemical, petrochemical, pharmaceutical and food processing industries. The Industrial Handling division develops application-optimized vehicle attachments for the handling and transport of packaging units. In addition to the corporate headquarters in Munich, Ringmetall is represented by worldwide production and sales branches in Germany, Great Britain, Spain, Italy, Turkey, the Netherlands as well as China and the USA. Worldwide, Ringmetall generates a turnover of more than 120 million euros per year.

17.09.2020 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.

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