Sony Pixel Power calrec Sony

SGL Carbon takes decisive countermeasures in the crisis - comparatively solid business development in the third quarter


The mid-term business prospects for SGL Carbon are impacted by the corona pandemic and structural changes in some markets. While the development in the automotive and aerospace sectors is lower than expected in the last 5 year plan, the wind energy business is growing much stronger than previously planned. These changes in the mix and the resulting deviations in earnings prompted the company to conduct an event-driven impairment test in the reporting segment CFM. On the basis of the current status of the preliminary 5 year plan - as announced on October 30, 2020 - this resulted in the need for an impairment charge of 80-100 million, which will be recorded in the fourth quarter of 2020.

In order to sustainably strengthen the profitability and competitiveness of SGL Carbon, the Board of Management has resolved an extensive restructuring program with planned earnings improvement measures totaling more than 100 million until 2023 (compared to the base year 2019). It includes a planned socially compatible reduction in personnel of more than 500 employees as well as substantial reduction in indirect spend. From today's perspective, costs of approx. 40 million are anticipated for the implementation of the program, of which a little more than half is expected to be recognized in profit and loss in the fourth quarter of 2020.

For the full year 2020, SGL Carbon continues to expect Group sales revenues to decline by 15% to 20% and operating recurring Group EBIT to record a slightly positive result. However, outlook for Group net result is reduced to minus 130 to 150 million due to the above-mentioned measures.

Like many other companies, the corona pandemic is also having a significant impact on us. In addition, we also see structural changes in some of our markets, such as in the automotive and aerospace sector. Thanks to decisive countermeasures, we are managing the crisis relatively well operationally. In addition, with our restructuring program, we have laid the foundation for the sustainable transformation of the company towards a leaner, profitable and successful SGL Carbon", explains Dr. Torsten Derr, CEO of SGL Carbon.

Group business development influenced by the Corona pandemic, structural changes in some markets and a positive one-off effectSGL Carbons sales revenues in the third quarter at 227 million were around 10% higher than in the previous quarter. At around 15 million, operating EBIT before non-recurring items was significantly better than in the previous quarter, which was weak due to the pandemic.

In the nine-month period, however, sales fell significantly by almost 18% (no currency effect) to 683.5 million (9M/2019: 832.4 million), primarily due to the weaker business development caused by the pandemic as well as expected declines in Battery & other Energy (GMS) and capacity adjustments in Textile Fibers (CFM). Accordingly, recurring EBIT in the reporting period fell by 38% to 33.9 million (9M/2019: 54.2 million). This includes a positive one-off effect of 8.5 million from the compensation agreement with the buyer of a former business unit (Showa Denko).

The net financial result improved significantly in the nine-month period to minus 23.4 million (previous year: minus 32.6 million). The result from continuing operations before income taxes changed significantly from minus 59.4 million in the prior year period to plus 1.4 million in the reporting period, as the previous year contained an impairment loss of around 75 million. After taxes, the consolidated net result for the reporting period was minus 3.9 million compared to minus 74.5 million in the same period of the previous year.

Free cash flow improved significantly to approx. 44 million in 9M/2020 (9M/2019: minus 9.6 million). As a result, liquidity developed very positively to approx. 167 million as of September 30, 2020, due to strict spend control and non-capital market related funding measures (year-end 2019: 137 million).

Business development by segmentComposites - Fibers & Materials (CFM): Second quarter marked the trough in sales and earnings development - significant recovery in the third quarterWhile the first quarter 2020 in the reporting segment CFM was still relatively unaffected by the Corona crisis, the effects were clearly visible in the second quarter 2020. Fortunately, the negative effects eased again in the third quarter, so that the development - particularly in earnings - was substantially better than expected at the half year mark. Compared to the previous quarter, CFM sales revenue increased by 20% to 97.7 million. Recurring EBIT even increased significantly from minus 1.9 million to 8.8 million. Compared to the third quarter of 2019, however, sales revenue decreased by approx. 11% while recurring EBIT improved significantly from minus 4.6 million in Q3/2019 to 8.8 million in Q3/2020.

In a nine-month comparison, sales revenue declined by approximately 14% (no meaningful currency effect) to 283.4 million. The largest percentage decline was recorded in the loss-making market segment Textile Fibers. This is due to the fact that, as part of the earnings improvement measures, SGL Carbon had at the end of 2019 started to convert one acrylic fiber line to precursor and to idle two acrylic fiber lines. Corona-related declines were recorded in the market segments Automotive and Industrial Applications. In contrast, business with the wind energy sector increased by more than 60% and thus again developed more favorably than initially anticipated. The Aerospace business remained relatively stable on a low level.

Recurring EBIT improved from minus 1.8 million in the prior year period to 10.6 million in the first nine months 2020. The substantially improved results in the wind energy business and the positive effects from the earnings improvement measures implemented at th
See more stories from sgl

More from SGL


SGL Carbon reports best operating result in more than ten years - transformation successfully completed

SGL Carbon demonstrated the resilience of its business model in a challenging ma...


Best apprentice in Germany at SGL's Meitingen site

For many years, SGL Carbon has been providing vocational training in a wide range of occupations, whether at our sites in Bonn, Meitingen, Willich, Innkreis, or...


SGL Carbon welcomes trade minister in Muir of Ord as recruitment drive continues

On 06 March 2023, SGL Carbon's fiber production plant in Muir of Ord has welcomed Trade Minister Ivan McKee as he tours the Highlands meeting businesses mak...


SGL Carbon sold its business activities at the Gardena site (USA)

As part of the realignment of SGL Carbon, strategic options were developed for all Business Units. In this context, the site network of the Business Unit Compos...


SGL apprentices support the sheltered workshop Dominikus-Ringeisen-Werk

Last December, apprentices at SGL Carbon in Meitingen again had a small sales booth at the Christmas market. The proceeds have now been donated to the Dominikus...


Dr. h.c. Susanne Klatten resigns as Chairwoman of the Supervisory Board of SGL Carbon SE at the end of the next Annual General Meeting

Dr. h.c. Susanne Klatten informed the Board of Management of SGL Carbon SE to re...


Spotlight on dual training: US experts at SGL Carbon in Meitingen

On February 10, 2023, SGL Carbon welcomed a US delegation in Meitingen to learn about the dual training program in Germany. The delegation, a total of 19 manufa...


SGL Carbon: Moody's rating upgrade

SGL Carbon SEs corporate family rating was raised from B3 to B2 by the renowned rating agency Moodys Investors Services . The rating of the guaranteed senior s...


Stumbling block in memory of forced labor laid in Meitingen

At the former Siemens-Plania in Meitingen, a predecessor company of todays SGL Carbon, a total of more than 200 foreign prisoners of war and civilian workers we...


SGL Carbon successfully overcomes current challenges

After 270.9 million in Q1 2022 and 278.9 million in Q2, SGL Carbon increased its consolidated sales to 304.1 million in Q3 2022. After nine months, this corr...


10 years of the Ort im Innkreis site - SGL Carbon's Austrian plant celebrates anniversary

With around 170 employees, fiber composite components for the automotive industr...


Disclosure of material transactions with related parties in accordance with section 111c German Stock Corporation Act (Aktiengesetz)

SGL CARBON SE Wiesbaden - ISIN DE00723501 - Disclosure of material transactio...


Repurchase Invitation by SGL CARBON SE (EUR 159,300,000 3.0 per cent convertible bonds due 2023 (ISIN DE000A2G8VX7))

Repurchase Invitation by SGL CARBON SE (the Company) to the holders of its E...


SGL Carbon SE - successful placement of 101.9 million convertible bonds due 2027

Wiesbaden, September 14 2022.SGL Carbon SE (the Issuer or SGL Carbon) today successfully completed the placement of unsubordinated, unsecured convertible bond...


Adhoc notification: SGL Carbon SE increases sales and earnings guidance again for the current fiscal year 2022

(07:33 PM) Due to the continued good business development, especially in the Car...


SGL Carbon trains its own junior staff: 23 new apprentices in Bonn and Meitingen

SGL Carbon continues to focus on training its own young talents. This year, SGL Carbon GmbH in Meitingen is training two industrial mechanics, two cutting machi...


SGL Carbon celebrates the return of personal encounters and a product anniversary at ACHEMA 2022

Finally live again: From August 22 to 26, 2022, the process industry will meet a...


SGL Carbon expands capacities for graphite products for use in the semiconductor industry

SGL Carbon will significantly increase capacities for the production of graphite...


SGL Carbon remains on track

Despite uncertain general conditions in the first six months 2022, SGL Carbons business model is proving its resilience. After 270.9 million in Q1 2022, SGL Ca...


Exchange between SGL apprentices and employees of the Dominikus Ringeisen plant

On July 12, 2022, six apprentices who are currently completing their first year of training at SGL Carbon or at Brembo SGL, a joint venture belonging to SGL, vi...


Meitingen site of SGL Carbon celebrates 100th anniversary

It all started with electric street lighting in Berlin, as well as electrically conductive components for electric trains and the melting of steel - the industr...


Adhoc notification: SGL Carbon raises sales and earnings guidance for 2022

(09:00 AM) Based on the good business development in all four Business Units as well as the mostly successful passing on of increased costs for raw materials, e...


fitforJOB! 2022 in Augsburg

On 21.05.2022, the IHK and the Handwerkskammer held the exhibition for the first time after 2019 again in presence. With about 3000 interested visitors and 155 ...


After Moody's, Standard & Poor's also upgrades SGL Carbon's rating

Standard & Poors Global Ratings (S&P) raises its long-term rating for SGL Carbon to B- and its issue rating on its financial instruments to B. The outlook for t...


Great approval at this year's Annual General Meeting of SGL Carbon

Due to Corona, our Annual General Meeting (AGM) was again held virtually in the head office in Wiesbaden on May 17, 2022. Registered shareholders were able to v...


SGL Carbon continues dynamic business development in Q1 2022

SGL Carbon generated consolidated sales of 270.9 million in Q1 2022 (Q1 2021: 241.5 million). This corresponds to an increase of 29.4 million or 12.2% compar...


"The team spirit in the group has grown"

Arousing the viewers interest right at the beginning of a video - the students of Class 10e of the Realschule Meitingen clearly demonstrated this during their f...


Adhoc notification: Termination of a heritable building right to a non-operating property

(03:00 PM) SGL Carbon SE today signed an agreement on the cancellation of its ex...


Congratulations to our apprentices in Meitingen and Bonn on their successful completion of training

A total of eleven apprentices from Meitingen and six apprentices from Bonn compl...


Initiated transformation shows effect in sales and earnings 2021 - SGL Carbon tops sales billion again

Rising demand in almost all market segments led to a 9.5% increase in Group sale...


SGL Carbon supports "DigitalSchoolStory" project at Meitingen secondary school

Tomorrows working world will be largely characterized by digital tools and digital communication. In a new type of project, the students of Class 10e at the Rea...


CO2 reduction of 50% by 2025

As an energy-intensive company, SGL Carbon has a special responsibility to reduce CO2 emissions. Therefore, one of our key ESG targets is to reduce our own CO2 ...


Anniversary year for SIGRAFLEX

SIGRAFLEX is our product brand for flexible graphite for use as a versatile and reliable sealing material for the chemical industry and many other sectors as we...


ESG in focus

We make our sustainability efforts measurable. We regularly review our sustainability progress and improve our ESG strategy. In dialog with our stakeholders, we...


Excellent trainees at SGL Carbon in Bonn

Our SGL site in Bonn looks back on a long tradition as a successful training company and also offers new training courses time and again. A new branch with a pr...


Rdiger Krieger becomes new plant manager of our Meitingen site

As of January 17, 2022, R diger Krieger has succeeded Markus Partik as manager of the SGL Carbon site in Meitingen. In addition, he also took over the managemen...


Rdiger Krieger as new plant manager of Meitingen

As of January 17, 2022, R diger Krieger has succeeded Markus Partik as manager of the SGL Carbon site in Meitingen. In addition, he also took over the managemen...


SGL Carbon receives SPE Innovation Award for glass fiber leaf spring

On November 10, 2021, the Automotive Division of the Society of Plastics Engineers (SPE ) in Michigan hosted its 50th annual Automotive Innovation Awards Gala, ...


SGL Carbon - Q3 2021 also confirms the encouraging upward trend

Following consolidated sales of 241.5 million in Q1 2021 and 255.2 million in Q2 2021, Q3 2021 confirms SGL Carbons encouraging sales performance with 246.8 ...


SGL Carbon opens new apprenticeship center at its site in Nowy Scz, Poland

At the beginning of September 2021, SGL Graphite Solutions Polska sp. z o.o. in Nowy S cz held the opening ceremony for a new apprenticeship center. As part of...


SGL Carbon installs photovoltaic system at its site in Ort im Innkreis, Austria

SGL Carbon now produces its own green electricity at its site in Ort im Innkreis. A photovoltaic system was installed on the roof of the plant. In cooperation w...


SGL Carbon puts additional state-of-the-art soft felt line into operation

SGL Carbon is expanding and modernizing its soft felt production. The company invested a single digit million euros in the last two years into an additional car...


SGL Carbon invests into modernization of its Morganton site

SGL Carbon is modernizing its production for porous and extruded graphite investing around million 10 USD at its site in Morganton, North Carolina, USA until th...


SGL Carbon delivers strong first half of 2021 - transformation program and improving order situation show first successes

While the past fiscal year 2020 was still characterized by a Corona-related slum...


SGL Carbon with solid development in the first quarter - Outlook for 2021 fully confirmed

SGL Carbons consolidated sales amounted to 241.5 million in the first quarter (...


Adhoc notification: SGL Carbon receives 42.9 million euros funding under IPCEI for graphite anode materials (GAM) in lithium-ion batteries

(09:24 AM) SGL Carbon GmbH, a 100% subsidiary of SGL Carbon SE, today received a...