In the first quarter 2020, SGL Carbon has not yet been significantly impacted by the Covid-19 pandemic and reached sales revenues slightly above the guidance corridor of 220 to 240 million euros published on March 12, 2020. In total, Group sales at 247 million euros was approximately 15 percent below the prior year level. The development is primarily attributable to changes in the lithium-ion battery supply chain in the business unit Graphite Materials & Systems (GMS) as well as to restructuring-driven lower sales in Textile Fibers in the business unit Composites - Fibers & Materials (CFM). As planned, Group recurring EBIT decreased by approximately 50 percent to 9 million euros and thus reached the upper end of the guidance corridor of a mid to high single-digit million euros amount.
As the global measures taken to contain the pandemic led to disruptions in production and supply chains in April and early May 2020, a significant double-digit percentage decrease in Group sales revenue and a negative Group recurring EBIT are expected for the second quarter 2020.
SGL Carbon implemented various measures to counter the economic impact of the pandemic at an early stage.
For this reason, liquidity developed very favorably compared to year-end 2019 and in contrast to the usual seasonal pattern and improved from 137 million to approximately 150 million euros.
"In these extraordinary times, we have two clear priorities: protecting the health of our employees, their families and our business partners and the responsibility for our company," says Dr. Michael Majerus, Spokesman of the Board of Management of SGL Carbon. "We acted decisively and took various measures at an early stage, both to ensure the safety of our employees and to mitigate the economic impact of the pandemic. SGL Carbon is well positioned from a financial perspective. Our strategic drivers are intact even in this period of global economic challenges. We anticipate that the demand for our solutions, especially in the areas of sustainability and digitization, will grow once the pandemic is over.
In the first quarter of 2020, sales revenues of SGL Carbon fell significantly by 14.5 percent to 246.8 (previous year: 288.8) million euros. The development is primarily attributable to the anticipated lower revenues in the GMS market segment Battery & other Energy. Restructuring-driven lower sales in the market segment Textile Fibers as well as reduced deliveries at CFM due to Covid-19 related production interruptions in customer operations, which started in March, also contributed to the decline in sales. Recurring EBIT decreased by 51.9 percent to 9.0 (previous year: 18.7) million euros as the significant decline in earnings in the reporting segment GMS could not be offset by operating earnings improvements in the reporting segment CFM and in Corporate. In the first quarter, return on capital employed (ROCE) based on recurring EBIT was at 3.1 (previous year: 5.0) percent. EBIT after non-recurring items decreased to 6.4 (previous year: 16.3) million euros in the first quarter 2020. Because of a negative foreign currency effect, net financing result decreased significantly to minus 9.4 (previous year: minus 6.2) million euros. Result before income taxes decreased from 10.1 million to minus 3.0 million euros, mainly due to the decline in EBIT and net financing result. Consolidated net result of the period amounted to minus 4.3 million (previous year: 8.9) million euros.
Composites - Fibers & Materials (CFM): Results substantially improved despite lower contribution from the At-Equity accounted investments; anticipated sales decline reflects restructuring-driven decrease in the market segment Textile FibersSales revenues in the business unit CFM developed as expected at 104.5 million euros, approximately 9 percent below prior year's level (currency adjusted: minus 10 percent). The decline in sales was anticipated due to the restructuring-driven lower sales in the market segment Textile Fibers. Corona-related declining trends in the market segments Automotive and Aerospace were compensated by the higher than expected sales growth in Wind Energy. Sales in Industrial Applications were stable and thus also slightly better than planned. Recurring EBIT grew to reach 3.7 million euros compared to the break-even level of the prior year quarter, despite almost 3 million euros lower contribution from the At-Equity accounted investments. The EBIT-margin improved from 0.3 percent to 3.5 percent. Main drivers for this development were the earnings improvement measures implemented last year, particularly the restructuring in Textile Fibers, price increases in the market segment Wind Energy as well as the segment-wide improvement of the operational performance. Return on capital employed (ROCE) based on recurring EBIT of the reporting unit CFM reached minus 0.8 (previous year: 1.8) percent. The decline in ROCE results from the calculation method, which employs recurring EBIT for the last twelve months.
Due to its exposure to the market segments Automotive and Aerospace, which are more than proportionately negatively impacted by the Corona crisis, the reporting segment CFM is significantly affected by the recent developments in these customer industries. However, these developments have not yet materially impacted the first quarter.
Graphite Materials & Systems (GMS): Sales revenues decrease mainly due to changes in the lithium-ion battery supply chain; result below prior year; Semiconductor business with good first quarterSales revenues in the business unit GMS in the first quarter 2020 saw a decline of 19.1 percent to 134.6 (previous year: 166.4) million euros (currency adjusted: minus 20 percent), but were in line with expectations due to the changes in the supply chain in the lithium-ion battery business. All market segments declined compared t
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SGL CARBON SE
Wiesbaden
- ISIN DE00723501 -
Disclosure of material transactio...
In the first quarter 2020, SGL Carbon has not yet been significantly impacted by the Covid-19 pandemic and reached sales revenues slightly above the guidance corridor of 220 to 240 million euros published on March 12, 2020. In total, Group sales at 247 million euros was approximately 15 percent below the prior year level. The development is primarily attributable to changes in the lithium-ion battery supply chain in the business unit Graphite Materials & Systems (GMS) as well as to restructuring-driven lower sales in Textile Fibers in the business unit Composites - Fibers & Materials (CFM). As planned, Group recurring EBIT decreased by approximately 50 percent to 9 million euros and thus reached the upper end of the guidance corridor of a mid to high single-digit million euros amount.
