Semperit reports high profits amid restructuring efforts

VIENNA—Austrian rubber engineering group Semperit A.G. Holding has reported higher earnings in the first half of 2018 despite a decline in revenue and amid operational restructuring.

In an Aug. 23 financial report, the Vienna-based company said earnings (EBITDA adjusted for negative one-off effects) increased by 45.3 percent year-on-year to $38 million in the first half of the year.

This is while total revenue fell 2.8 percent to $522 million during the period.

The business development, Semperit said, was characterized by continuous global growth dynamics and favorable economic conditions in the first half of 2018. However, "the escalating trade war between the U.S. and China, rising inflation and massive currency devaluations in some of the large emerging economies caused increasing uncertainties in the raw material and financial markets."

Commenting on the results, Semperit Chairman Martin Fuellenbach said the company had intensified its restructuring and transformation plans in the past months.

"A consolidated view on the industrial sector shows that the increasingly visible success of measures already taken confirms our course. Here, the most visible results are the already completed closings of plants in France and China as well as the currently ongoing shutdown and sales process at two more sites in Germany and Italy," Fuellenbach said.

As part of the restructuring measures, the Semperform site in Dalheim, Germany, is being integrated into another German location in Hueckelhoven.

Additionally, the sale of Semperflex production site in Roiter, Italy, is being examined.

The medical sector is Semperit's "most demanding challenge" with the company working on the area with "utmost concentration and focus," according to Fuellenbach.

Semperit recorded a decline in sales and volumes in its medical sector and in the Sempertrans conveyor belts business.

However, Semperflex hose production and Semperform construction materials performed well in global sales and achieved an increase in revenue.

In terms of sales, Semperit's industrial segment, including Semperflex, Sempertrans and Semperform, posted a 4 percent increase to $339.5 million in the first half of the year, compared to the year before.

Revenues in Semperflex and Semperform increased. In contrast, revenue at Sempertrans declined due to a shift of the product mix towards high-margin products as well as the shutdown of the plant in France and low production in China in the first half of 2018.

The largest share of the revenue increase was attributable to the Semperflex segment. Adjusted EBITDA for the segment improved by 26 percent to $48.7 million compared with the previous year.