Raw materials threat to Semperit recovery

Earnings (EBITDA) increased 83.3% year-on-year to €15.8 million, while the EBITDA margin increased from 4.2% to 7.1% in the first quarter of 2018.

At €220.9 million, however total revenue in the first quarter was 3.7% below the previous year’s value, the Austrian group reported 25 May.

Chairman Martin Füllenbach did not get carried away by the jump in earnings: cautioning that Semperit remained “in a difficult situation,”

“One successful quarter is not a successful turnaround,” added Füllenbach, who nevertheless believes that group-wide restructuring and transformation efforts are gaining traction.

Semperit's statement, though, noted that increasing inflation and “massive” currency devaluations in some large emerging economies were impacting raw materials and finance markets.

“A fierce competition for supply of some of the raw materials Semperit needs has emerged in recent months,” the group reported.

In the first quarter, Semperit's Industrial Sector achieved an increase in revenue of 0.5% which was offset by a revenue decrease of 10.3% in the Medical Sector.

In the Industrial Sector, sales volumes at Semperflex and Semperform increased but fell at Sempertrans. Revenue increased by 0.5% to €140.9 million. Earnings (EBITDA) rose 9.1% to €18.8 million, with the margins increased by 1.0% to 13.3%.

In the Medical Sector, Sempermed sales fell 10.3%, reflecting a change to more profitable business areas and competitive pressures. Earnings (EBITDA) struggled in at €1.4 million.

At €24.5 million, investment in assets was 12.7% higher than the prior-year level: including expansions of hose production at the Semperflex plant in Odry, Czech Republic; and of mixing at the Sempertrans plant in Belchatow, Poland.

The Vienna-headquartered group employs around 6,800 people worldwide, including around 3,700 in Asia and more than 800 in Austria – both in Vienna and at its production site in Wimpassing, one of 16 manufacturing facilities worldwide

In 2017, the group generated sales of €874.2 million and earnings (adjusted EBITDA, less one-off effects) of €35.8 million.

Semperit's product portfolio includes medical examination and surgical gloves, hydraulic and industrial hoses, conveyor belts, escalator handrails, construction profiles, cable car rings, and products for railway structures.