According to the preliminary, unaudited figures, the RHI Group concluded the financial year 2014 with revenues of approximately € 1,720 million and an operating result exceeding expectations and amounting to over € 140 million. The operating result margin will thus amount to more than 8% after 7.2% in the previous year. In the fourth quarter of 2014, revenues of roughly € 465 million and an operating result of over € 40 million were realized. In terms of revenues, the fourth quarter thus exceeds the third quarter of 2014 by approximately 12% and the fourth quarter of 2013 by roughly 2%.
In the business unit glass, no significant improvement of the results is to be expected in the years to come due to difficult market conditions and worldwide excess capacities for fused cast products. The management consequently introduced sustainable savings of € 3.5 million in the year 2014. In addition, raw materials for applications in the Industrial business, which were previously purchased externally, will be produced at the American site starting in the year 2015 in order to improve capacity utilization. Despite these measures, which are already being implemented, an impairment loss on existing assets of approximately € 12 million has to be recorded at the end of the year 2014.
At the plant in Porsgrunn, Norway, significant progress was made in the production process in the newly established fusion plant during the year 2014. Nevertheless, further optimization measures are required in the upstream production of caustic magnesia in order to achieve the targeted costs. Therefore the Management Board of RHI AG adopted comprehensive measures which provide for a temporary reduction of the production volume due to the low market prices of fused magnesia. The premium-grade qualities for customers in the steel industry will still be supplied with raw materials from Norway. These measures secure the continued operation of the plant and will halve the negative contribution to earnings in the year 2015. Nevertheless, an impairment of the assets of roughly € 7 million is necessary in the year 2014.
In Europe, the RHI Group is optimizing raw material treatment. For this reason, production at the site in Kretz, Germany, will be discontinued and assigned to other RHI plants. This will result in sustainable annual savings of approximately € 3.5 million, of which roughly € 0.7 million were already realized in the past financial year due to a partial shift of volumes. The optimization of raw material treatment leads to a one-off negative effect of roughly € 10 million in the year 2014 and will have an effect on cash in the coming years.
If the above-mentioned one-off effects are deducted from the operating result, the EBIT for the financial year 2014 amounts to more than € 110 million.
The Management Board of RHI AG intends to propose a dividend of € 0.75 to the Annual General Meeting on May 8, 2015.
Due to the positive development of incoming orders during the past months and the measures taken by the management, RHI expects a year-on-year increase in revenues by roughly 3% and an operating result margin of approximately 9% in the current macroeconomic environment. If the US dollar continues to strengthen against the euro, further positive effects on revenues and EBIT can be expected.