Klöckner & Co SE reports market-related impacts on earnings 2nd quarter of 2019

by Hans Diederichs

In the second quarter of 2019, operating income (EBITDA), at €51 million before material special effects, was below the prior-year figure of €85 million. While Klöckner & Co benefited from a very positive market environment in the second quarter of 2018, earnings in the reporting quarter were impacted by negative price and volume effects. Including material special effects, EBITDA was €82 million as in the prior-year quarter. The sale of a property in the United Kingdom had a positive one-off effect of €36 million. Conversely, personnel-related measures at the Group holding company in Germany and in France reduced EBITDA by about €5 million in total. Net income was €28 million, compared with €33 million in the prior-year quarter. Earnings per share consequently came to €0.28 (Q2 2018: €0.33).

Klöckner & Co has continued to make good progress in its digital transformation. Accordingly, the proportion of sales generated via digital channels increased in the second quarter of 2019 to 29% (Q2 2018: 20%). After its entry into the consulting business, digital unit kloeckner.i successfully completed its first sizable consulting project with a DAX 30 company. XOM Materials, the independent industry platform launched by Klöckner & Co, likewise continued its successful development. The platform has already recruited 34 distributors and over 300 customers, including another major international steel producer.

For the remaining course of the year, Klöckner & Co expects negative impacts from a fall in demand, principally from the European automotive and mechanical engineering sectors. Negative price effects in the USA are also likely to be larger than originally expected. The net outcome is guidance of €25 million to €35 million for EBITDA in the third quarter. For the full year, Klöckner & Co now expects EBITDA of €140 million to €160 million before and €170 million to €190 million including material special effects.

Source: Kloeckner & Co SE       Photo: Fotolia

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