Business development of the RHI Group was characterized by positive growth in both divisions in the first half of 2004. RHI Refractories increased sales revenue worldwide by 5.3%, adjusted for currency effects by 9.2%; Heraklith (Insulating) improved sales revenue by even 12.1%. Hence, both divisions also continued to improve their operating results.
Overall, the RHI Group reported sales revenues of € 632.0 million (previous year: € 613.4 million) in the first half of 2004, an increase by 3.0%. The growth rates in Refractories and Insulating are partly compensated because sales revenues in the amount of € 18.4 million were deconsolidated as a result of the sale of the Waterproofing activities in the previous year. RHI continued the positive development of operating results. EBITDA amounted to € 79.7 million (previous year: € 78.6 million); EBIT, at € 55.7 million (previous year: € 53.9 million), also exceeded the level of the previous year. The EBIT margin reached 8.8% again. Net income before income taxes rose by 18.9% to € 39.0 million (previous year: € 32.8 million).
RHI Refractories contributed € 544.3 million (previous year: € 516.7 million) to consolidated sales revenue in the first half of 2004, an increase by 5.3% or, adjusted for currency effects, by 9.2%. Refractories sales volume grew by 10.9% to 831,000 tons in the reporting period. EBIT amounted to € 60.7 million (previous year: € 59.2 million), which corresponds to an EBIT margin of 11.2%. Negative effects of the 11% change in the US dollar/euro relation on sales revenue and EBIT were thus compensated.
Heraklith increased sales revenues of € 86.8 million (previous year: € 77.4 million) significantly up to 12.1%. Heraklith more than doubled the operating result, EBIT amounted to positive € 2.8 million (previous year: € 1.1 million).
The group’s net income, at € 18.1 million (previous year: € 21.0 million) in the first half, did not match the comparative figure of the previous year because the effects of the tax reform 2004 (especially reduction of the Austrian corporation tax from 34% to 25%) had to be taken into account. As a result, deferred tax assets due to loss carry-forwards had to be revalued once in accordance with IFRS and recognized as affecting results. The resulting one-off effect contained in income taxes, which is non-cash effective, amounts to € -11.3 million. Without this effect net income would have increased by 40%.
Cash flow from operating activities, at € 25.2 million in the first half of 2004 (previous year: € 20.1 million), exceeded the figure of the previous year. Interest-bearing financial liabilities in the RHI Group were reduced by € 9.8 million in the first half of 2004 and amounted to € 286.8 at June 30, 2004.
The level of incoming orders in the RHI Group remains good worldwide; the positive trends in sales volume and revenue from the first half should be confirmed as the year 2004 progresses. The impact of the further on high raw material and energy prices as well as freight costs and on the other hand the price increases introduced by RHI on the operating result in the second half of 2004 can currently not yet be estimated accurately. Overall, the earnings outlook for 2004 is positive, RHI expects a similarly good operating result as in the previous year.