Following consolidated sales of €241.5 million in Q1 2021 and €255.2 million in Q2 2021, Q3 2021 confirms SGL Carbon's encouraging sales performance with €246.8 million. Due to increasing demand from almost all market segments, Group sales increased to a total of €743.5 million in the first nine months of the fiscal year (9M 2020: €683.5 million). This corresponds to an increase of 8.8% compared to the same period of the previous year.
Almost all business units contributed to the positive sales development. As largest business unit with a 44.7% share of Group sales, Graphite Solutions (GS) contributed €332.7 million to Group sales in the first nine months of 2021 (9M 2020: €308.0 million). The sales increase of 8.0% is based in particular on the positive development of the important market segments Semiconductor & LED as well as Automotive & Transportation. The business units Carbon Fibers and Composite Solutions contributed €244.7 million (9M 2020: €223.4 million) and €92.1 million (9M 2020: €60.7 million), respectively, to Group sales and benefited primarily from increased demand from the automotive industry. Compared to the previous year, sales increased by 9.5% in Carbon Fibers and by 51.7% in Composite Solutions. Only the Process Technology business unit, with sales down 4.9% to €62.1 million, was not yet able to participate in the general economic upward trend.
Results situation:
SGL Carbon's EBITDApre improved by 59.1% year-on-year to €108.5 million in the first nine months (9M 2020: €68.2 million). Increased sales in almost all business units, the associated higher capacity utilization and new high-margin orders from the automotive industry in the Composite Solutions business unit contributed to the improvement in earnings. The cost savings achieved as a result of the transformation initiated at the end of 2020 also had a positive earnings impact. However, negative effects from significantly higher raw material and energy prices weighed on EBITDApre, especially in the isolated third quarter of 2021.
EBITDApre does not include non-recurring effects and special items totaling €6.2 million. These consist of non-recurring effects of €21.7 million, mainly from the proceeds generated by the sale of two properties not required for operations, netted against negative special items totaling €15.5 million.
EBIT also increased significantly to €71.8 million in the first nine months of 2021 compared to €24.8 million in the same period of the previous year. In addition to the positive effects mentioned above, the EBIT increase also results from the €9.2 million decrease in depreciation and amortization to €42.9 million (9M 2020: €52.1 million) due to the impairment carried out at the end of 2020.
Based on the positive business development, the successes of the transformation as well as one-off effects of € 21.7 million, thereof € 19.5 million from the sale of two properties, the consolidated net income after nine months in 2021 amounts to €42.6 million (9M 2020: minus €3.9 million).
Net financial debt and equity:
SGL Carbon's net financial debt decreased by 33.1% to €191.6 million as of September 30, 2021 compared to year-end 2020. This development was mainly due to the increase in cash and cash equivalents by €95.0 million to €236.8 million (December 31, 2020: €141.8 million). This is primarily based on a positive free cash flow, which increased significantly by €60.1 million to €122.5 million (9M 2020: €62.4 million) as a result of the positive business performance and the mentioned one-off effects (€30.6 million).
Equity attributable to equity holders of the parent company amounted to €308.4 million as at September 30, 2021, up 39.7% compared with the end of the last financial year (December 31, 2020: €220.7 million). Accordingly, the equity ratio increased to 22.7% (December 31, 2020: 17.5%).
Transformation program:
The restructuring and transformation process initiated at SGL Carbon at the end of 2020 has made a significant contribution to the Company's positive sales and earnings performance. In the third quarter of the current fiscal year, increased prices for raw materials, energy, and transport and logistics reduced the savings achieved, as these could only be passed on to customers in part and/or with time lags.
Outlook:
For the remaining months of fiscal year 2021, we see only limited market risks, also due to the order intake already received. We also consider the negative impact on the communicated sales and earnings forecast for 2021 due to increased raw material, energy and transport costs to be limited from today’s perspective. We do not anticipate any renewed deterioration in the general conditions due to the Corona pandemic.
According to the explanations given above, we confirm the revenue and earnings guidance for fiscal 2021 provided on July 13, 2021.
Further details on business development and outlook can be found in the quarterly statement on the first nine months of 2021.
