08.11.12

SW Umwelttechnik: Third quarter report 2012

Category: Company results, Press releases

• Improvement of result reached with decreasing turnover

• Increasing order income in the engineering segment

• Positive POA through consistent restructuring

SW Umwelttechnik has been able to improve its operating results even though turnover decreased, which was largely due to the recessive markets of CEE as well as the thus related project delays in Hungary. The satisfying order income in the third quarter 2012 of EU-subsidised projects in CEE will have a positive effect especially on the operating performance for 2013. The in the recent years consistently implemented restructuring, and the stable exchange rates, lead to a profit.

Turnover is 10 % below that of the previous year and amounts to € 44.7 m (2011: € 49.7 m).Our operating result is higher than in the previous year and now amounts to € 0.8 m (2011: € 0.5 m) and we were also able to slightly improve our EBITDA to € 3.6 m (2011: € 3.5 m). The upward revaluation of the HUF in the current year as well as the book profit from the sale of our Iso Span Baustoffwerk GmbH shares have had a positive effect on our financial result, now amounting to € - 0.7 m  (2011: € - 3.8 m). Our profit/loss on ordinary activities thus shows a significantly improved value, also because of the stable exchange rate, of now € 0.1 m (2011: € - 3.3 m) - so an increase of plus € 3.2 m.

We were able to reach a turnover of € 20.7 m in the third quarter, which reflects a decrease of 5 % compared to the previous year (€ 21.8 m). Our EBIT of € 1.8 m (2011: € 2.2 m) and our EBITDA of € 2.7 m (2011: € 3.0 m) are slightly lower than in the previous year. However, we were able to improve our profit/loss on ordinary activities from € -1.1 m in the previous year to € 1.0 m in the third quarter 2012.

Segmental analysis

In Hungary the implementation of infrastructure projects in the first half of 2012 were launched very late because of the difficulties of co-financing of the state. This has largely affected our project engineering segment, but also our water conservation segment. We were thus only able to reach a turnover of € 21.1 m (2011: € 23.4 m) in our water conservation segment, which reflects a reduced group turnover share of 48 % (2011: 47 %). In contrast the infrastructure segment, with investments from industry and trade clients, was increased slightly to € 16.5 m (2011: € 15.9 m), which now reflects a group share of 37 % (2011: 32 %). Project engineering amounts to € 7.1 m (2011: € 10.4 m) and is thus significantly lower than in the previous year - however, order income in this segment has significantly improved in the third quarter.

Regionally we can report a turnover in Hungary that only amounts to € 17.5 m (2011: € 22.5 m) with a turnover share of 39% (2011: 45%) - due to the slowly financed EU projects and the recessive market environment. The turnover in Austria was stable, even though we sold our Iso Span Baustoffwerk GmbH shares it now amounts to € 11.9 m (2011: € 12.3 m) and holds a group share of 27 % (2011: 25 %). Our turnover in Romania was kept nearly at the same level with € 10.4 m (2011: 11.6 m) and 23 % share of group turnover (2011: 23 %) - and this even though we changed our focus on to more profitable market segments. Our exports have developed well and now amount to € 1.5 m    (2011: 0.8 m) for Germany and € 1.4 m (2011: € 1.0 m) for Italy - exports from our core countries Austria, Hungary and Romania now amount to 11 % of total turnover.

Financial analysis

Our long-term assets as of 30 September 2012 amount to € 69.7 m (2011: 73.0 m). Our floating assets have remained nearly the same to the previous year and now amount to € 33.8 m (30 September 2011: € 26.8 m). Our total assets thus lie under that of the balance sheet date of the previous year with € 103.5 m (30 September 2011: € 106.3 m).

Our equity capital as of 30 September 2012 amounts to € 8.5 m (30 September 2011: € 10.0 m) - however, when considering the intrinsic values (without non-cash effecting FX losses), our equity capital remains on a stable level with € 17.7 m, which reflects an equity capital ratio of 16 %. Financial liabilities amount to € 78.2 (2011: € 78.5 m) - so nearly the same level as for the previous year.

Order income

Our order income has been increased in the last months and as of 30 September 2012 amounts to  € 41.1 m, which is significantly higher than in the previous year (2011: € 29.1 m). This great increase results from the project commissioning back on track in Hungary and Romania. We will be able to complete around a third of our order volume in the current year, the majority however will be finalized in subsequent years.

Investments

We kept our investments on a low level as in the previous year, also because of our modern plants. We invested € 1.0 m in the first three quarters, mainly for replacements.

Employees

Our average number of employees was adapted to the market environment and reduced by another  7 % compared to the previous year. Our total now amounts to 506 employees (2011: 543).

Outlook

The company has adapted to the current economic backdrop and we are able to cushion this volatile market development due to our lean cost structure and our flexible production management.

Hungary remains in a recessive environment due to the economic-political situation, whereby the construction sector remains regressive even compared to the difficult previous year. Through intensive processing of the export markets, the weakness of the internal market can be partly compensated.

We can compensate the slightly recessive market in Austria by continuously introducing product innovations and through our exports. We are expecting a similar market development for the coming year.

In Romania, we are already seeing positive impulses in the water conservation segment, due to an increase in EU-subsidized projects. Investments from industry and trade clients remain cautious however.

We expect no changes in the market environment for the full year and continue to see earnings to stabilize with a decrease in turnover.

Fact box

in € m

Q I-III 2012

Q III 2012

Q I-III 2011

Q III 2011

Turnover

44.7

20.7

49.7

21.8

EBIT

0.8

1.8

0.5

2.2

EBITDA

3.6

2.7

3.5

3.0

P/L OA

0.1

1.0

-3.3

-1.1

SW Umwelttechnik, a family firm founded in 1910 and listed on the Viennese stock exchange since 1997, stands for sustainable management in Eastern and South-eastern Europe.  With our innovative technology to protect the environment we provide an important contribution to the development of necessary infrastructure in Central and South-eastern Europe.

Notice of availability:

This interim report for Quarter 3 2012 can be found on www.sw-umwelttechnik.com and is also available at headquarters.

For further enquiries:

Dr. Bernd Wolschner
Managing Director

Tel:       +43 463 32 109 202
Fax:     +43 463 32 109 296

Website:          www.sw-umwelttechnik.com

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