DGAP-News: H&R GmbH & Co. KGaA publishes Annual Report 2018

H&R GmbH & Co. KGaA publishes Annual Report 2018

- Positive contributions from all segments securing an operating income of EUR 74.7 million at a robust level

- Net income of EUR 21.6 million

Salzbergen, Germany, March 21, 2019. In the financial year 2018 H&R GmbH & Co. KGaA (H&R KGaA; ISIN DE000A2E4T77) achieved an operating income (EBITDA - consolidated income before tax, other financial income and expenses and depreciation/amortization, impairment and appreciation of fixed assets and property, plant and equipment) of EUR 74.7 million (2017: EUR 97.9 million) (for other earnings levels, see table "Key figures for H&R KGaA"). All in all, net profit attributable to shareholders amounted to EUR 21.6 million (2017: EUR 32.1 million) and was thus EUR 10.5 million below the previous year's result, partly due to the more difficult market conditions and political challenges. Earnings per share amounted to EUR 0.59 (2017: EUR 0.88). This figure was achieved with sales revenues of EUR 1,114.2 million, which were higher due to higher raw material prices. This is around 9 % more than in the previous year (2017: EUR 1,025.1 million).

Positive earnings contributions from all segments
With EBITDA of EUR 76.1 million (2017: EUR 98.0 million), the Chemical-Pharmaceutical Raw Materials division with its Refining and Sales segments contributed the main share to Group EBITDA. However, the company had to shoulder a higher cost of materials in this area in the context of the crude oil price development, which could only partly be passed on to customers in the form of higher product prices. Internationally, the trade conflict between the USA and China had a particularly negative impact on the planned development. In the Plastics segment, the discussion about the manipulation of exhaust emission values and the worldwide weakening sales figures of the automotive industry also left their mark. The segment achieved operating income of EUR 3.0 million (EBITDA 2017: EUR 3.7 million).

Cash flow development characterized by net working capital requirements
Based on the lower consolidated income, operating cash flow remained clearly positive despite the decrease from EUR 46.2 million to EUR 23.3 million. The higher net working capital requirements due to increased raw material prices in particular had a negative impact. The increased cash outflows for investments further reduced free cash flow from EUR -11.9 million to EUR -46.4 million. Balance sheet total increased to EUR 730.4 million at the end of financial year 2018 (Dec. 31, 2017: EUR 662.7 million). The Group's equity rose to EUR 357.4 million at the balance sheet date (Dec. 31, 2017: EUR 342.7 million) and quoted at 48.9 % (Dec. 31, 2017: 51.7 %).

No dividends to be proposed to the Annual General Meeting
In principle, H&R has achieved a distributable result for 2018. Nevertheless, the Management will propose to the Annual General Meeting that no dividend should be paid. Due to the negative cash flow, a dividend would have to be loan-financed, which would further increase the company's liabilities. The existing uncertainties regarding the funding amounts for the flood protection measures at the Hamburg refinery site as well as the EEG (Renewable Energy Law) exemption at the Salzbergen site following the amendment of the EEG 2017 also require cautious budgeting. The persistently uncertain economic prospects in our core markets and among our main customers also suggest that we should leave the funds in the Group.

Outlook
At around EUR 75 million, we achieved a stable operating income, which is more oriented to the years of success than the times of crisis in 2013/14. It is therefore with self-confidence, but also a dose of realism, that we are drawing up our forecasts for 2019 and setting as our target an operating income (EBITDA) figure that should range between EUR 75.0 million and EUR 90.0 million.

For a complete presentation of business performance including segment reporting and the annual financial statements, H&R KGaA refers to the 2018 Annual Report to be published today.

Key figures for H&R KGaA:

Key figures for the segments

Contact information:
H&R GmbH & Co. KGaA, Head of Investor Relations/Communications, Ties Kaiser
Neuenkirchener Strasse 8, 48499 Salzbergen
Tel.: +49 40 43218-321, Fax: +49 40 43218-390
e-mail: ties.kaiser@hur.com ; www.hur.com

H&R GmbH & Co. KGaA:
H&R KGaA is a specialty-chemicals company listed on the Frankfurt Stock Exchange's Prime Standard segment. It develops and manufactures crude-oil-based chemical and pharmaceutical specialty products and produces high-precision plastic parts.

Forward-looking statements and forecasts:
This press release contains forward-looking statements. The statements are based on the current estimates and forecasts by the Executive Board and the information available to the Board at this time. These forward-looking statements do not provide any warranty for the future developments and results contained therein. The future developments and results are dependent on a number of factors; they entail various risks and contingencies and are based on assumptions which could prove to be incorrect. We do not assume any responsibility for updating the forward-looking statements contained in this press release.