RHI Magnesita Confident On Future After Transformational 2017

21st Mar 2018 09:14

LONDON (Alliance News) - RHI Magnesita RV reported on Wednesday solid revenue and earnings growth in a year in which it successfully completed both a major merger and a listing on the London Stock Exchange.

The refractory products, systems, and services firm was created in the merger of RHI AG and Magnesita Refratarios SA, and the combined company completed its listing on the Main Market in London in October.

Adjusted pro-forma revenue increased by 11% to EUR2.68 billion, driven by growth in both its Steel and Industrial divisions, while earnings before interest, tax, and amortisation grew 39% to EUR304.1 million, driven by higher sales.

RHI Magnesita is to pay a dividend of EUR0.75 per share for 2017, flat year-on-year.

On a statutory basis, 2017 revenue rose to EUR1.95 billion from EUR1.65 billion, with pretax profit dipping to EUR23.5 million from EUR105.8 million, but these figures only include two months' worth of results from Magnesita Refratarios.

Revenue in the Steel division, which made up 67% of the company's total, increased 22% to EUR1.31 billion in 2017 due to a "strong" pick-up in production in 2017 as well as two months of Magnesita work. Performance in North America and Latin America was strong, and was "slightly" positive in Africa, but in the Commonwealth of Independent States region it was flat year-on-year.

In the Industrial division, 2017 revenue was up 7.2% year-on-year to EUR577.6 million due to strong sales of cement, which rose 20% on 2016. Demand declined in India, and stabilised in Brazil after "massive" declines, but it rose in China and Europe.

RHI Magnesita said it has begun 2018 well, and it looks forward to the new year "with confidence".

Chief Executive Stefan Borgas and Chairman Herbert Cordt said: "2017 was a truly transformational year for the business, which will go down in the company history as the year when we successfully implemented and completed the merger of RHI and Magnesita.

"The listing on the premium segment of the London Stock Exchange at the end of October was a resounding success for RHI Magnesita. The merger reshapes the landscape of the sector as RHI Magnesita is now the global market leader and the driving force of the industry."

They added: "In addition to the cross-border merger, RHI Magnesita recorded a strong operating performance in the financial year which is attributable to the company's efficient operations, improving macroeconomic environment and the engagement of all employees worldwide."

RHI Magnesita shares were down 2.2% on Wednesday 447.50 pence each.

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