2017-04-26 07:30:41 CEST
2017-04-26 07:30:41 CEST
REGULATED INFORMATION
Kemira Oyj - Interim report (Q1 and Q3)
Kemira Oyj's Interim Report January-March 2017: Revenue grew in all segments while profitability was under pressure
Kemira Oyj
Interim Report
April 26, 2017 at 8.30 am (CET+1)
Kemira Oyj's Interim Report January-March 2017: Revenue grew in all segments
while profitability was under pressure
This is a summary of the January - March 2017 Interim report. The complete
Interim report with tables is attached to this release and available at
www.kemira.com/investors.
Q1 2017
* Revenue increased 5% and was EUR 610.0 million (582.7) as revenue grew in
all segments, especially in Oil & Mining driven by increased activity in the
shale oil & gas markets. Revenue in local currencies, excluding acquisitions
and divestments, increased 2% driven by volume growth.
* Operative EBITDA decreased 5% to EUR 69.0 million (72.8) due to lower sales
prices, temporary supply distractions and sudden increases in some raw
material prices during the first quarter.
* Operative EBITDA margin declined to 11.3% (12.5%).
* EPS decreased to EUR 0.12 (0.16) mainly due to lower profitability and
higher finance costs.
Outlook for 2017 (unchanged)
Kemira expects its operative EBITDA to increase from the prior year (2016: EUR
302.5 million).
Kemira's President and CEO Jari Rosendal:
"The start for the year was two-folded. Our revenue grew in all segments driven
by the organic growth while profitability was below the prior-year level due to
three main reasons. Sales prices are still lower than a year ago, although the
decline in sales prices has stopped on sequential comparison. Rising feedstock
prices impacted profitability for all segments as the tightness in ethylene and
propylene markets caused sudden increases in oil-based raw material prices.
Temporary supply distractions, such as the force majeure at Huntsman Pigments in
Finland and the supply shortage of chlorinated fatty acid, have increased costs
and caused some asset under-utilization.
In Pulp & Paper, sales volumes continued to grow. We lost revenue due to the
force majeure, but the underlying revenue generation is developing according to
plan. The new site serving Klabin in Brazil is fully operational and we expect
the new sodium chlorate line in Joutseno, Finland, to be up and running in the
fourth quarter of 2017. The major contract manufacturing agreements with
AkzoNobel will end in the coming months leading to synergies of EUR 20 million
as a run-rate at the end of 2017.
Oil & Mining had organic growth of 16% driven by strong sales volume development
in the North American shale oil & gas business. However, the profitability level
was unsatisfactory for the segment in Q1 due to recent increases in raw material
prices. We have already announced price increases for our polymer products to
counteract the impact of these higher raw material costs.
In Municipal & Industrial, volume growth continued, however, lower average sales
prices and higher manufacturing costs impacted profitability. The segment
continued to deliver strong cash flow.
We are executing our strategy according to plan in the mixed market environment.
We will merge Oil & Mining and Municipal & Industrial into one new segment,
Industry & Water. Organizational structure is planned to be changed to support
the two segment model and this is expected to result in further operational
efficiencies of EUR 15-20 million as a run-rate at the end of 2017. The main
objectives of the change are to simplify Kemira's way of working and further
improve service to its customers."
KEY FIGURES AND RATIOS
Jan-Mar Jan-Mar Jan-Dec
EUR million 2017 2016 2016
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Revenue 610.0 582.7 2,363.3
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Operative EBITDA 69.0 72.8 302.5
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Operative EBITDA, % 11.3 12.5 12.8
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EBITDA 66.7 71.1 284.2
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EBITDA, % 10.9 12.2 12.0
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Operative EBIT 34.9 40.9 170.1
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Operative EBIT, % 5.7 7.0 7.2
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EBIT 32.6 39.2 147.0
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EBIT, % 5.3 6.7 6.2
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Finance costs, net -6.7 -6.0 -19.1
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Profit before taxes 26.1 33.3 128.0
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Net profit attributable to equity owners 18.3 24.5 91.8
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Earnings per share, EUR 0.12 0.16 0.60
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Capital employed* 1,736.8 1,697.8 1,718.2
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Operative ROCE* 9.5 9.7 9.9
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ROCE*, % 8.1 7.9 8.6
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Cash flow from operating activities 12.2 26.2 270.6
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Capital expenditure excl. acquisitions 36.9 31.4 212.6
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Capital expenditure 36.9 29.5 210.6
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Cash flow after investing activities -24.6 -2.3 97.8
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Equity ratio, % at period-end 43 42 45
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Equity per share, EUR 7.24 6.96 7.68
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Gearing, % at period-end 59 60 54
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Personnel at period-end 4,771 4,711 4,818
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*12-month rolling average (ROCE, % based on the EBIT)
Kemira provides certain financial performance measures (alternative performance
measures) on non-GAAP basis. Kemira believes that alternative performance
measures, like operative EBITDA and operative EBIT, followed by Kemira
management, provide useful and more comparable information of its operative
business performance.
Kemira's alternative performance measures should not be viewed in isolation to
the equivalent IFRS measures and alternative performance measures should be read
in conjunction with the most directly comparable IFRS measures. Definitions of
the alternative performance measures can be found in the Definitions of the key
figures in this report, as well as at www.kemira.com >Investors > Financial
information.
All the figures in this interim report have been individually rounded and
consequently the sum of individual figures can deviate from the presented sum
figure.
OUTLOOK FOR 2017 (UNCHANGED)
Kemira expects its operative EBITDA to increase from the prior year (2016: EUR
302.5 million).
MID- AND LONG-TERM FINANCIAL TARGETS (UNCHANGED)
Kemira aims at above-the-market revenue growth with operative EBITDA margin of
14-16%. The gearing target is below 60%.
Helsinki, April 25, 2017
Kemira Oyj
Board of Directors
INTERIM REPORTS 2017
Interim report January-June 2017 July 20, 2017
Interim report January-September 2017 October 25, 2017
Capital Markets Day will be held in London on September 21, 2017.
PRESS AND ANALYST CONFERENCE AND CONFERENCE CALL
Kemira will arrange a press conference for the analysts, investors, and media on
April 26, 2017 starting at 10.30 a.m. (8.30 a.m. UK time) at GLO Hotel Kluuvi,
Kluuvikatu 4, 2nd Floor, Helsinki. During the conference, Kemira's President and
CEO Jari Rosendal and CFO Petri Castrén will present the results. The press
conference will be held in English and will be webcasted at
www.kemira.com/investors. The presentation material and the webcast recording
will be available on the abovementioned company website.
You can attend the Q&A session via a conference call. In order to participate in
the conference, please call ten minutes before the conference begins:
FI +358 9 7479 0361
SE +46 8 5033 6574
UK +44 330 336 9105
US +1 719 325 4746
Conference id: 2982715
For more information, please contact:
Kemira Oyj
Olli Turunen, Vice President, Investor Relations
Tel. +358 10 862 1255
Kemira is a global chemicals company serving customers in water-intensive
industries. We provide expertise, application know-how and chemicals that
improve our customers' product quality, process and resource efficiency. Our
focus is on pulp & paper, oil & gas, mining and water treatment. In 2016, Kemira
had annual revenue of around EUR 2.4 billion and 4,800 employees. Kemira shares
are listed on the Nasdaq Helsinki Ltd.
www.kemira.com
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