Bekaert: Third quarter trading update 2017
10 Novembre 2017 - 7:30AM
Bekaert achieves 11% top line growth
Sales
Bekaert achieved consolidated sales of € 3 073
million in the first nine months of 2017, up more than 11% from the
same period last year. The consolidated sales growth stemmed from
increased organic sales (+7.5%), the net effect of mergers,
acquisitions and divestments (+3.7%) and limited currency effects
(+0.3%). The organic growth was driven by higher sales volumes
(+2.5%) and the aggregate effect of wire rod price increases and
price-mix (+5%).
Outlook
Market
developments
Bekaert has reported solid underlying volume
growth over the first nine months of the year, particularly in
automotive and construction markets. We project continued strong
demand in these sectors, while taking into account normal year-end
seasonality.
The oil prices have been rising slowly but
steadily for the last 6 months. If this trend continues, we may
start to see some investment activity in this market in the near
future. This would create opportunities for Bekaert's profiled
wires for flexible pipes as well as for the Bridon-Bekaert Ropes
Group where the projected recovery is taking longer than
anticipated in the ropes part of the business.
We see little signs of recovery in Latin America
and the uncertainty in the US is creating an increasingly difficult
economic business climate.
The technology shift to new generation sawing wire
solutions in solar markets is rapidly driving down demand for our
loose abrasive wire products.
It has been extremely difficult to pass on raw
materials price increases in almost all of our businesses. This is
a very unusual dynamic in our industry and it is stopping us from
being able to turn improved volumes into incremental profitability
in the short term.
Business
developments
As reported before, the integration of the
formerly wholly-owned subsidiary in Sumaré (Brazil) into the
partnership with ArcelorMittal and the full-year integration of the
Bridon business in Bridon-Bekaert Ropes Group at lower than average
margins, will have an adverse impact on Bekaert's 2017 margins.
Full year 2017
The pricing environment in the market today will
not allow us to turn our improved volumes into incremental profit
this year. We continue to forecast that we will broadly repeat the
underlying EBIT performance of FY2016.
Moving forward, there will be more positive growth
into 2018 as our actions to drive value creation will be gaining
impact. We also remain confident about our underlying strategy and
about the effectiveness of our transformation and investment
programs that will allow us to move towards a 10% underlying EBIT
margin over the coming years.
Press release in PDF
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Source: Bekaert via Globenewswire
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