14th Nov 2019 09:22
(Alliance News) - RHI Magnesita NV on Thursday said its ongoing production optimisation plan and sales strategy is expected to deliver further upside and margin improvement.
The refractory products supplier, which is hosting a presentation event for investors and analysts on Thursday, said its production optimisation plan includes the rationalisation and specialisation of the company's production footprint and other cost-reduction measures.
The company's enhanced sales strategy includes focus on key growth markets in Asia and the development of solutions business model and digital customer offering.
"These two initiatives are together targeting a run-rate, annual earnings before interest, taxes and amortisation improvement of EUR70-80 million by 2022 and have associated costs to deliver of EUR220m, broadly split between 2020 and 2021. These costs will partly be financed by working capital reduction," the Vienna, Austria-based company said.
In 2020, RHI Magnesita is also expecting merger synergies to contribute EUR20 million to Ebita and turnaround of operations to add EUR15 million to Ebita. It additionally expects to record benefits from its price management programme.
RHI Magnesita shares in London were up 0.7% at 3,808.00 pence each on Thursday morning.
By Tapan Panchal; [email protected]
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