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Favourable RHI half-year balance shows new, focussed Group

26. July 2006

Key Figures RHI Half-year Report 2006

Following the Heraklith sale effective 13 June 2006 RHI’s half-year consolidated balance sheet shows the structure adjusted for Heraklith with a balance sheet total of € 1.1 billion. The results of the group contain a book profit from the sale in the amount of € 60.8 million, profit for the first half of 2006 amounts to € 107.0 million. Equity, which is still negative in the RHI balance sheet, subsequently improved significantly in the first half of 2006 by € 94.9 million and amounted to € -86.2 million. Taking into account the outstanding RHI convertible bonds, equity is positive again. In late 2001, this figure was approx. € -500 million after the write-down and deconsolidation of the US refractories companies. Since that time, financial liabilities have been cut by more than half from more than € 1 billion to now € 488.6 million; including cash and cash equivalents, this figure is now only € 454.1 million. This roughly corresponds to the 2.5-fold EBITDA of the new and focused RHI, this key figure illustrates the group’s regained financial scope.

Overall, the RHI Group reported revenue in the amount of € 666.8 million in the first half of 2006 (previous year, comparable to the new structure 2006: € 601.9 million), an increase by 10.8%. EBITDA amounted to € 86.4 million (€ 75.9 million); EBIT, at € 64.6 million (€ 56.0 million), was up 15.4%. Profit before income taxes rose by 17.6% to € 51.4 million, profit from continuing operations (Refractories, other) was € 46.2 million (€ 40.3 million). Profit from discontinued operations (Insulating) amounted to € 60.8 million (€ 3.5 million); the RHI Group’s half-year profit, at € 107.0 million (€ 43.8 million), reached a historic high amounting to 2.5 times the figure of the previous year.

RHI Refractories reported revenue amounting to € 660.0 million in the first half (previous year: € 596.8 million), an increase by 10.6%. Refractories sales volume rose 5.2% to 900,000 tonnes. EBIT amounted to € 67.7 million (€ 66.5 million); the EBIT margin was 10.3% (11.1%). The increase in revenue was accounted for by a slightly under-proportional contribution from global business with steel customers and a disproportionately high contribution from business with customers in the industrial segment. Steel once again realised significant increases in revenue with key accounts in North America and, parallel to production of local steel customers, slight declines in South America. Industrial recorded satisfactory growth in the business units nonferrous metals, environment, energy, chemicals as well as cement and lime as compared to the previous year. Only business with glass customers was still down on the level of the previous year.
Incoming orders and the good economic situation of RHI’s customer industries indicate a positive business development for refractories.