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DGAP-News: Metalcorp Group B.V. / Key word(s): Preliminary Results Metalcorp Group reports significant earnings growth for 2013

04.02.2014 / 10:06

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Metalcorp Group reports significant earnings growth for 2013 - EBT up 80.8% to EUR 4.7 million - EBIT climb 34.8% to EUR 6.2 million

Amsterdam/Berlin, 4 February 2014 - According to preliminary figures, Metalcorp Group B.V. significantly increased all consolidated earnings figures compared to the previous year in spite of a sharp drop in metal prices in the world market. Against the background of a higher business volume and a reduction in Group sales revenues to EUR 302.8 million (previous year: EUR 387.3 million), which was attributable to commodity prices and exchange rates, earnings before interest and taxes (EBIT) rose by 34.8% to EUR 6.2 million (previous year: EUR 4.6 million). Earnings before taxes (EBT) soared 80.8% from EUR 2.6 million to EUR 4.7 million. The main reasons for this increase were the expansion of the non-ferrous business and the higher business volume.

Says Victor Carballo, CEO of Metalcorp Group: 'We were able to expand our business volume in 2013 primarily because we deposited the proceeds from our corporate bond with banks in cash. The increased volume and the fact that our profit margin remained almost constant thanks to our low-risk business model led to the leap in earnings. The increase is also reflected in sales revenues if they are adjusted for the lower commodity prices and the weaker dollar.'

To facilitate international comparison, especially with regard to the 8.75% bond, which has been listed in the Frankfurt Stock Exchange's Entry Standard for corporate bonds since June 2013, the company has switched from Dutch GAAP to IFRS accounting. This has had no impact on the comparability of the statement of income.

Metalcorp Group's preliminary consolidated figures for 2013 confirm the effectiveness of the low-risk business model, which makes the company's operations virtually immune to price trends in the commodity markets. This is due, on the one hand, to back-to-back transactions in the 'Steel and NF Metals Trading' segment, where contracts are signed only once both the supplier and the customer for the transaction are known. These transactions include a percentage margin for Metalcorp Group which is completely unrelated to the current metal market price. Moreover, the company refrains from keeping its own stocks to avoid risks which may arise from price fluctuations in the commodity markets. In the second business segment, 'Production of Secondary Aluminium', Metalcorp Group operates exclusively on the basis of fixed customer orders. Here, too, the current aluminium price is irrelevant, as the company receives a fixed processing premium from its customers.

Consolidated total assets rose from EUR 159.2 million on 31 December 2012 to EUR 234.2 million on 31 December 2013. The increase is attributable to higher receivables and short-term trade financing by the trade finance banks, which are directly related to the increased trading volume, as well as to the issue of the corporate bond in 2013. On the assets side, the rise in liquid funds to EUR 14 million shows that the proceeds from the bond issue were primarily used as cash collateral for the banks to expand the trading volume. On the liabilities side, the Group's equity amounted to EUR 93.4 million on the reporting date (31 December 2012: EUR 81.0 million). This is equivalent to an equity ratio of 39.9%, compared to 50.9% on 31 December 2012.

In view of the delivery and production contracts already signed, the Management Board expects the positive earnings trend to continue in the 2014 financial year.

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PRESS RELEASE: Metalcorp Group reports significant earnings growth for 2013