S&T AG achieves rises in sales and earnings in the first six months of 2015 - gross margin increasing strongly

Wednesday, 5th August 2015

Austria

Sales rise by 14% to EUR 188.2 million (PY: EUR 164.8 million)
Gross margin increases to 36.6% (PY: 32.9%)
Consolidated income rises by 21% to EUR 6.0 million (PY: EUR 4.9 million)
Orders backlog grows even larger to EUR 171.8 million (PY: EUR 106.5 million)

S&T AG (www.snt.at) was able to accelerate its growth of sales and earnings in the second quarter of 2015. Sales increased to EUR 95.4 million, as opposed to EUR 85.6 million in the previous year's period of comparison, corresponding to a rise of 11.5%. Corresponding to the growth in sales, gross margin rose even more strongly, climbing to EUR 35.5 million (37.2%), as opposed to EUR 28.5 million (33.3%) in 2014. The growth joined with the costs whose increase arose from the entry into the smart energy market in enabling the achieving of an EBITDA of EUR 5.0 million, as opposed to EUR 5.2 million in the previous year. The consolidated income amounted to EUR 3.3 million, as opposed to EUR 2.5 million in 2014.

Sales in the first six months of 2015 came to EUR 188.2 million, as opposed to EUR 164.8 million in the previous year's period of comparison. Manifesting the portfolio mix, which is heavy on higher-margin items, gross margin amounted to EUR 69.0 million (36.6%), as opposed to EUR 54.2 million (32.9%) in the first six months of 2014. EBITDA increased to EUR 10.8 million (PY: EUR 10.0 million). This led as a whole to a 21% rise in consolidated income, which amounted to EUR 6.0 million (PY: EUR 4.9 million). Earnings per Share amounted to 13 cents, as opposed to 12 cents in the first half of 2014.

Strongest driver of growth were the “Appliances Security” and “Appliances Smart Energy” segments. This was partially caused by the acquisitions made in 2014. In the first six months of 2015, the sales achieved in the two segments increased from EUR 26.2 million to EUR 54.6 million. “Appliances Smart Energy” as a new segment recorded start-up-losses of EUR 1.0 million in the first six months of 2015, after it recorded profits of EUR 0.1 million in the previous year's period of comparison. The “Appliances Security” segment, conversely, recorded profits - EUR 4.8 million (PY: EUR 3.9 million) - exceeding those planned for it. The positive development in the “Services Eastern Europe” segment will accelerate in the months to come. This is due to the large amount of orders booked in the second quarter. The “Services Germany, Austria and Switzerland” segment registered in the first six months of 2015 - in a change - positive operating results. This result came despite its sales having declined - as had been planned - by EUR 8 million (less low-margin hardware).

The operative cash flow came in the second quarter to EUR 16.0 million. This enabled the near-offsetting of the negative cash flow registered in the first quarter of EUR 17.0 million. Cash and cash equivalents amounted to EUR 36.9 million, as compared to EUR 39.5 million as of 31.12.2014 and EUR 26.8 million as of the commencement of the quarter. Financial liabilities came to EUR 47.8 million (31.12.2014: EUR 41.0 million and EUR 47.1 million as of the beginning of the quarter), whereas next to the acquisitions investments into the company's headquarters had been paid from existing cash and credit lines. The equity increased as of 30.6.2015 to EUR 93.0 million, as opposed to EUR 89.7 million as of 31.12.2014. The equity rate amounted to 35.8% (31.12.2014: 32.9%).

The growth being registered by the “Appliances Security” and “Appliances Smart Energy” technology segments is causing management to expect for the current financial year for the Group as a whole a strong 20% rise in sales, which will come to EUR 465 million. Also forecast for financial year 2015 is a consolidated income of EUR 15 million - notwithstanding start-up losses being experienced in the smart energy segment. Planned for 2016 are double-digit sales growth and profits outpacing that rise. The orders backlog has increased still further, and now comes to EUR 172 million. The amount of projects in the pipeline amounts to EUR 708 million - a record. These facts emphasize the feasibility of these ambitious objectives for growth.