28th Feb 2022 11:52
(Alliance News) - RHI Magnesita NV on Monday reported a strong rise in profit in 2021, thanks to new acquisitions and joint venture investments, and a recovery in customer demand.
RHI is Vienna-based supplier of refractory products.
Shares were down 6.8% in London on Monday at 2,808.00 pence each. The wider FTSE 250 index of mid-caps was down 0.5%.
For 2021, pretax profit surged to EUR289.1 million from EUR41.5 million in 2020. RHI noted it made a EUR110.2 million profit from its joint ventures, up sharply from EUR7.6 million in 2020.
Revenue improved to EUR2.55 billion from EUR2.26 billion.
Pretax profit for 2021 exceeded 2019's EUR199.6 million, though revenue was short of that year's EUR2.92 billion.
"This has been a strong year of progress for RHI Magnesita in challenging conditions. Customer demand recovered much faster than was anticipated, creating an unprecedented strain on global supply chains and significant increases in costs and logistics lead times. We responded with EUR127 million of price increases largely realised in the fourth quarter and increased inventories to keep our customers supplied throughout this period of disruption," Chief Executive Stefan Borgas said.
RHI declared a total dividend of EUR1.50, unchanged on 2020.
"Despite logistics difficulties and market volatility we have progressed the strategic investments which will deliver long term growth and margin improvement. We agreed to acquire Sormas in Turkey in October and we are making a new joint venture investment in Chongqing, China," Borgas continued.
"Our strategic commitment to grow in new markets has been validated by strong organic revenue growth in both our India and China businesses. We enter 2022 with restored margins and ready to build further on our sustainability and technology leadership position in the global refractory industry."
RHI said its Steel unit has a "strong" order book, but it expects customer demand to normalise in the second half of 2022. Also noted it Industrial unit order book covers most of 2022.
By Paul McGowan; [email protected]
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