Germany’s SKW Metallurgie Q1 profit shrinks 81% on start-up costs

15 May 2012 06:19  [Source: ICIS news]

SINGAPORE (ICIS)--Germany's SKW Metallurgie reported on Tuesday an 81% year-on-year slump in first-quarter net profit to €800,000 ($1m), weighed down by start-up costs of new plants.

Its revenues for the first three months of the year were up 12.1% year on year to €113.2m, but earnings before interest, tax, depreciation and amortisation (EBITDA) declined 40% to €6m, the specialty chemicals firm said in a statement.

Its operating profit for the March quarter 2012 declined by half to €3.5m, it said.

SKW Metallurgie said it expects a lower 2012 EBITDA than last year’s €31.7m, which was augmented by a one-off gain.

The company’s EBITDA in the first half of the year is expected to be “substantially depressed by the start-up costs for the new plants, in particular in Bhutan”, the company said.

“If we succeed in turning around in the second half of the year, we are confident that, given a further stabilisation in the global economy in 2012, we will be able to match or even exceed the previous year’s figures for revenues and operating EBITDA,” said SKW Metallurgie CEO Ines Kolmsee in the statement.

“The group continues to expect that the new plants (extensions to plants in Brazil and the USA, acquisition of a plant in Sweden, new plants constructed in Russian and Bhutan) will make a full contribution to earnings in 2013,” the company said.

($1 = €0.78)

By: Pearl Bantillo
+65 6780 4359

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