Afarak Group Plc Afarak Group: 2016 Interim Results
August 16 2016 - 1:00AM
UK Regulatory
TIDMAFAGR
07:00 London, 09:00 Helsinki, 16 August 2016 - Afarak Group Plc
("Afarak" or "the Company") (LSE: AFRK, NASDAQ: AFAGR) Interim Report
AFARAK GROUP PLC'S INTERIM REPORT FOR 1 APRIL - 30 JUNE 2016
Q2 HIGHLIGHTS (April - June 2016):
- Board approved additional capital redemption of EUR0.01 per share
- Revenue decreased by 25.6% to EUR 39.5 (Q2/2015: 53.1) million as a
result of extreme weakness in demand and prices for Afarak's products
- Processed material sold decreased by 11.2% to 28,214 (Q2/2015: 31,755)
tonnes
- Despite the challenging external environment EBITDA remained positive
at EUR 0.8 (Q2/2015: 7.6) million and the EBITDA margin was 2.0%
(Q2/2015: 14.4%)
- EBIT was EUR -0.9 (Q2/2015: 5.8) million
- Profit for the period from continuing operations totalled EUR -1.0
(Q2/2015: 5.7) million
- Ferrochrome production decreased by 3.8% to 26,786 (Q2/2015: 27,856)
tonnes
- Tonnage mined decreased by 56.8% to 56,395 (Q2/2015: 130,417) tonnes
- Cash flow from operations was EUR -0.4 (Q2/2015: 5.0) million and
liquid funds at 30 June were
EUR 13.2 (30 June 2015: 10.5) (31 March 2016: 21.7) million
- The Group reduced its debt by EUR 4,7 million due to its strong cash
position notwithstanding the depressed markets
INTERIM DISTRIBUTION
The Board resolved on an additional capital redemption of [EUR 0.01] per
share, using the authorization given by the AGM held on 11 May 2016.
The payment will be made from the company's fund for invested
unrestricted equity on16 September 2016.
KEY FIGURES (EUR million) Q2/16 Q2/15 Change H1/16 H1/15 Change FY2015
Revenue 39.5 53.1 -25.6% 80.3 93.8 -14.4% 187.7
EBITDA 0.8 7.6 -89.8% 4.1 12.3 -66.9% 17.2
EBITDA margin 2.0% 14.4% 5.1% 13.1% 9.2%
EBIT -0.9 5.8 0.8 8.8 9.9
EBIT margin -2.2% 11.0% 1.0% 9.3% 5.3%
Earnings before taxes -1.3 5.4 -0.4 8.1 6.5
Earnings margin -3.2% 10.2% -0.5% 8.6% 3.5%
Profit from continuing
operations -1.0 5.7 -1.3 8.0 7.8
Profit from discontinued
operations 0 0 0.5 0 0.8
Profit -1.0 5.7 -0.8 8.0 8.5
Earnings per share, basic,
EUR -0.00 0.02 -0.00 0.03 0.03
Commenting on the second quarter results, Alistair Ruiters, CEO, said:
"The external environment in quarter two was one of the most challenging
in recent years. Selling prices continued to plummet and the South
African rand continued its rally against the US dollar and the euro.
These two factors have adversely impacted the industry at large with
more firms going into business rescue.
Despite the difficult environment, Afarak still managed to achieve a
positive EBITDA in the first half of the year. In the face of plummeting
prices, we consciously stuck to our policy of not compromising our
selling prices in favour of larger sales volumes and the downward price
pressures hit our sales volumes particularly in the Speciality Alloy
segment. In addition, our mining volumes were much less since no
open-cast mining happened at Mecklenburg.
Looking ahead, we are expecting our performance to improve in the coming
months. Improved benchmark prices for charge chrome will favour Afarak
and our decision to switch one of the silicon manganese furnaces at our
Mogale plant to charge chrome should reflect positively in our returns
from the FerroAlloys segment. We are also expecting increased business
from the United States with respect to special grade ferrochrome.
Internally, we are very much focused on using this difficult period to
evaluate our cost structures across our operations. The Board and
Management is actively promoting cost saving initiatives and assessing
ways to streamline business processes with a view of strengthening our
sustainability.
Our balance sheet position remains healthy. Over the past year, Afarak
has further reduced its debt levels and maintains a good cash position.
Afarak remains committed to its shareholders and we aim to continue
creating value for all our stakeholders Looking ahead, market sentiment
is positive and it is expected to improve in the coming months. This
improved economic outlook and Afarak's balance sheet position gives the
Board sufficient comfort to issue the interim capital redemption that
was agreed during our last Annual General Meeting.
Disclosure procedure
Afarak follows the disclosure procedure enabled by Disclosure obligation
of the issuer (7/2013) published by the Finnish Financial Supervision
Authority, and hereby publishes its Q2/2016 interim report enclosed to
this stock exchange release. The Interim Report is attached to this
release and is also available on the Company's website at
www.afarak.com.
Investor Conference Call
Management will host an investor conference call in English on 17 August
2016 at 14.00 Finnish time, 12.00 UK time. Please dial-in at least 10
minutes beforehand, quoting the reference: 38313.
Finnish number +358 800 77 4579
UK number +44 (0) 844 762 0 762
AFARAK GROUP PLC
Alistair Ruiters
CEO
For additional information, please contact:
Afarak Group Plc
Alistair Ruiters, CEO, +358 50 372 1130, alistair.ruiters@afarak.com
Melvin Grima, Finance Director, +356 2122 1566, melvin.grima@afarak.com
Jean Paul Fabri, PR & Communications Manager, +356 2122 1566,
jp.fabri@afarak.com
Financial reports and other investor information are available on the
Company's website: www.afarak.com. Afarak Group is a chrome mining and
minerals producer focused on delivering sustainable growth with a
Speciality Alloys business in southern Europe and a FerroAlloys business
in South Africa. The Company is listed on NASDAQ Helsinki (AFAGR) and
the Main Market of the London Stock Exchange (AFRK). Distribution:
NASDAQ Helsinki London Stock Exchange main media www.afarak.com
2016 INTERIM RESULTS: http://hugin.info/143997/R/2035379/758036.pdf
This announcement is distributed by NASDAQ OMX Corporate Solutions on
behalf of NASDAQ OMX Corporate Solutions clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the information
contained therein.
Source: Afarak Group via Globenewswire
HUG#2035379
http://www.afarakgroup.com
(END) Dow Jones Newswires
August 16, 2016 02:00 ET (06:00 GMT)
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