Viohalco S A : Financial results for the six months ended 30 June 2020

FINANCIAL RESULTS FOR THE FIRST HALF YEAR 2020

Brussels, 24 September 2020 - Viohalco S.A. (Euronext Brussels: VIO, Athens Stock Exchange: BIO), hereafter "Viohalco" or "the Company", today announces its financial results for the first half year of 2020.

Resilient performance despite challenging market conditions

H1 2020 highlights

• Solid financial performance despite the COVID-19 outbreak;
• • Consolidated revenue of EUR 1,875 million (H1 2019: EUR 2,216 million);
  • Consolidated adjusted EBITDA (a-EBITDA) amounted to EUR 126 million (H1 2019: EUR 156 million), while consolidated EBITDA, which includes the effect of metal prices, stood at EUR 108 million (H1 2019: EUR 137 million).
• Swift action taken to ensure operational resilience throughout the COVID-19 pandemic, while ensuring the health and safety of companies' employees and other stakeholders;
• Investment programmes to drive operational efficiency improvements and leverage market opportunities remain on track across all segments.

Overview

During H1 2020, Viohalco's financial performance remained solid due to the resilience and swift response of the Viohalco companies to market developments, despite the profound impact of the COVID-19 pandemic on global markets throughout the period.

In the aluminium segment, Viohalco companies successfully maintained market share, despite the adverse effects of the pandemic, increased competition and the deterioration in metal prices which affected profitability.

The copper segment managed to increase market share and maintain profitability, against the broader adverse market conditions. Production facilities remained unaffected throughout the period and the segment was able to successfully capitalize on the reactivation of European markets, continuing to serve its long-standing business partners and also establishing new relationships.

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In the steel segment, demand and selling prices declined throughout H1 2020 as the COVID-19 pandemic added further challenges to an already difficult market environment. Accordingly, the segment adjusted production levels in an effort to manage costs. Furthermore, a decline in international spreads was recorded in SBQs, plates, wire rods and rebars, as a result of the intensive international competition, affecting the profitability of the segment.

Meanwhile, the cables segment saw steady growth in its projects business during H1 2020, reinforcing the segment's financial performance. As expected, the COVID-19 pandemic had a negative impact on the products business, the part of the segment which serves the construction sector, after a solid start in the first quarter of 2020. Despite the challenges experienced throughout the first half of the year, the cables segment recorded high capacity utilisation rates across all production units.

Global energy markets experienced difficult conditions during the first half of 2020, as the steep decline in oil and gas prices was coupled with the postponement or cancellation of many projects due to the pandemic. That said, Corinth Pipeworks was only mildly affected, supported by a strong order backlog and swift reaction to new conditions ensuring uninterrupted production.

Finally, in the real estate segment, the COVID-19 pandemic and the associated lockdown measures significantly affected the hospitality and retail sectors during H1 2020. In addition, measures imposed by the Greek government, reducing rents between March and June 2020, compounded these challenges. Nevertheless, the diversity of the real estate segment's portfolio, the financial strength of tenants and effective asset management enabled the segment to avoid arrears in rent or service charge in the period.

Financial overview

Summary consolidated statement of profit or loss

Amounts in EUR thousands	H1 2020	H1 2019
Revenue		1,875,389	2,216,242
Gross profit		152,414	176,543
EBITDA*		107,751	137,460
a-EBITDA*		126,306	155,990
EBIT*		41,598	68,350
a-EBIT*		60,153	86,881
Net finance cost	-46,717	-51,063
Profit/ Loss (-)	before tax	-7,474	17,282
Profit/ Loss (-)	for the period	-15,257	3,761
Profit / Loss (-) attributable to owners of the Company	-17,474	462

*APM definitions have been slightly changed compared to 31/12/2019. For further details refer to Appendix.

Viohalco's consolidated revenue for H1 2020 decreased by 15% year-on-year to EUR 1,875 million (H1 2019: EUR 2,216 million), mainly due to the decrease in metal prices during the months March-May, at the peak of the COVID-19 pandemic.

Consolidated a-EBITDA decreased by 19% to EUR 126 million in H1 2020 (H1 2019: EUR 156 million).

Net finance cost decreased to EUR 47 million (H1 2019: EUR 51 million), mainly as a result of credit spread reductions implemented gradually across all Viohalco companies in recent years.

Viohalco's consolidated loss before income tax for the period amounted to EUR 7 million, compared to profit of EUR 17 million in H1 2019, affected by the decline in metal prices and the global slowdown due to the pandemic, especially in the aluminium and steel segments.

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Summary consolidated statement of financial position

Amounts in EUR thousands	30/6/2020	31/12/2019
Fixed & intangible assets	2,197,908	2,152,103
Other non-current assets	70,030	67,296
Non-current assets	2,267,937	2,219,399
Inventory	1,033,500	1,060,009
Trade and other receivables (inc. contract assets)	598,585	559,919
Cash and cash equivalents	147,316	214,499
Other current assets	9,936	9,084
Current assets	1,789,337	1,843,511
Total assets	4,057,274	4,062,910
Equity	1,300,785	1,335,073
Loans and borrowings	961,899	943,522
Other non-current liabilities	221,417	212,302
Non-current liabilities	1,183,316	1,155,824
Loans and borrowings	851,788	830,455
Trade and other payables (inc. contract liabilities)	673,197	710,957
Other current liabilities	48,188	30,600
Current liabilities	1,573,173	1,572,012
Total equity and liabilities	4,057,274	4,062,910

Capital expenditure for the period amounted to EUR 124 million (H1 2019: EUR 123 million), largely driven by the completion of investment in the four-stand tandem aluminium hot finishing mill, while depreciation and amortization for the period reached EUR 68 million.

Working capital remained almost at the same levels as in year-end 2019.

Viohalco companies' net debt increased to EUR 1,721 million (2019: EUR 1,613 million).

Performance by business segment

	Amounts in EUR		Revenue		EBITDA		a-EBITDA		EBIT				EBT
	thousands
	Segments		H1 2020		H1 2029		H1 2020		H1 2029		H1 2020		H1 2019		H1 2020			H1 2019		H1 2020			H1 2019
	Aluminium		565,857		683,658			39,396		57,928		41,508		61,758			12,351			32,471			4,922			24,270
	Copper		530,673		554,939			17,746		22,322		26,898		26,727			10,478			15,226			1,080			7,137
	Steel		345,082		449,232			5,516		18,132		11,146		25,550			-10,348			-1,273			-23,597			-16,260
	Cables		268,160		294,241			32,868		25,720		35,124		28,466			25,585			17,838			14,268			6,325
	Steel pipes		134,923		195,458			7,674		13,171		7,674		13,316			3,338			8,208			-2,074			2,265
	Real estate		6,270		4,248			3,754		2,885		3,754		2,885			1,264			673		-196			-628
	Other		24,424		34,466			798		-2,699		201		-2,711			-1,069			-4,794		-1,878			-5,827
	activities
	Total		1,875,389		2,216,242			107,751		137,460		126,306		155,990			41,598			68,350			-7,474			17,282

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