Graphit Kropfmühl AG: Turnover reaches EUR 84.6 million; Profit for the year 2009 (EBIT) EUR 1.1 million; Operative cashflow clearly improved to EUR 5.7 million

Graphit Kropfmühl AG / Final Results

17.03.2010 07:00

Dissemination of a Corporate News, transmitted by
DGAP - a company of EquityStory AG.
The issuer / publisher is solely responsible for the content of this
announcement.

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Kropfmühl, Germany, 17 March 2010 --- Today Graphit Kropfmühl AG (DEUTSCHE
BOERSE: 'GKR') announced that the Supervisory Board of Graphit Kropfmühl AG
has approved the audited annual financial statements of the stock company
and the consolidated financial statements on 12 March 2010. The annual
financial statements for fiscal year 2009 are thus adopted.

Course of business 
In fiscal year 2009 the Graphit Kropfmühl group could not avoid being
influenced by the development in the general economic environment, and
consolidated turnover consequently decreased by 6.5 % or EUR 5.9 million to
EUR 84.6 million.

The silicon-metal segment clearly was less affected by the recession than
the graphite segment. While the graphite segment compared to the previous
year had to put up with a decrease in turnover of about  18 %, the
silicon-metal segment until the end of the year was able to almost
completely make up for the declining turnover figures of the first
quarters.

Silicon-metal segment braves the economic environment
In this segment we reached a turnover of EUR 60.5 million. Compared to the
previous year this in light of the general economic environment means a
moderate decrease of 0.8 %.

The earnings figures of the segment still are burdened by in European
comparative terms high energy costs. Furthermore, significant price
increases for important raw materials such as charcoal and electrodes
resulted in a disproportionately high decrease of the gross profit.

Consequently, earnings before interest, taxes, depreciation and
amortization (EBITDA) remained lower than in the previous year, which also
applies to the earnings before interest and taxes (EBIT).

The EBITDA is EUR 4.2 million, after EUR 6.8 million in the previous year.
Consequently, the EBIT decreased from EUR 5.8 million in 2008 to EUR 2.8
million in 2009.

Graphite segment cannot evade the weak economic environment
In the graphite segment we had to put up with a decrease in turnover of
18.3 % to EUR 24.1million. Due to the disproportionately high decrease, the
segment turnover proportion of total turnover at the same time dropped to
28.5 %.

Restructuring and rationalisation measures were already initiated at an
early time to meet the effects.  In Sri Lanka the workforce was reduced by
more than 200 employees within the scope of a severance payment program.
The relocation of a production line from Great Britain to the Czech
Republic was completed in the 2nd quarter of 2009. In Germany we responded
to our low capacity utilisation with short-time work to reduce structural
expenses and yet not lose employee know-how.

These measures were able to lessen the effects on the earnings before
interest, taxes, depreciation and amortization adjusted for restructuring
expenses (adjusted EBITDA), but there still remained a drop of approx. EUR
2.4 million. Consequently, the earnings before interest, taxes, and
restructuring expenses (adjusted EBIT) decreased from EUR 0.7 million in
2008 to EUR - 1.7 million in 2009.

Earnings position in the group
For the whole group this means a decrease of earnings before interest,
taxes, depreciation and amortization adjusted for restructuring expenses
(adjusted EBITDA) of more than 50 % to EUR 4.2 million.  Earnings before
interest, taxes, and restructuring expenses (adjusted EBIT) with EUR 1.1
million are thus considerably lower than in the previous year with EUR 6.5
million.

After positive earnings before tax (EBT) of EUR 4.8 million in the previous
year, we had to accept negative earnings of EUR 0.6 million for fiscal year
2009. As a result, the earnings for the year attributable to the
shareholders of Graphit Kropfmühl Aktiengesellschaft also were negative
with EUR 0.9 million. This means that there is a loss of EUR 0.32 per
share, after positive earnings of EUR 1.21 in the previous year.

Operative cashflow increased despite the difficult environment

In view of the unstable environment in the financial sector one important
objective in 2009 was to secure the liquidity of the whole group. Various
measures contributed to an increase of the operative cashflow in 2009 by
EUR 1.3 million to EUR 5.7 million. We used these funds to reduce our net
debts with banks by EUR 0.5 million in 2009. At the same time we were able
to reorganise our outside capital structure by raising long-term loans and
to clearly reduce the use of short-term credit lines.

The financial ratios in the group are as follows:

Group                                         2007  2008  2009    Change
Turnover                       euro million   83.1  90.5  84.6   -  6.5 %
Foreign-country share of
turnover                               in %   36.7  36.1  24.6
Gross profit1                  euro million   13.0  15.2   8.7   - 42.8 %
EBITDA1                        euro million    7.4   9.2   4.2   - 54.3 %
EBIT1                          euro million    4.6   6.5   1.1   - 83.1 %
EBT                            euro million    3.2   4.8  -0.6 not stated
Consolidated earnings for the                                    
year                           euro million    1.9   3.5  -0.9 not stated
Cashflow from ordinary business        
activities                     euro million    4.3   4.4   5.7     29.5 %
Investments                    euro million    4.3   7.1   5.2   - 26.8 %
Balance sheet total            euro million   61.1  70.9  68.8   -  3.0 %
Stockholders equity            euro million   21.0  23.8  22.8   -  4.2 %
Equity ratio                           in %   34.3  33.6  33.1
Net debt                       euro million   17.1  19.3  18.9   -  2.1 %
Employees (31 December)                        714   600   477   - 20.5 %

Profitability                                 2007  2008  2009    
EBITDA margin                          in %    8.9  10.2    5.0
EBIT margin                            in %    5.5   7.2    1.3
Return on sales                        in %    2.3   3.8   -1.2
Return on equity                       in %    9.0  14.3   -4.4

Silicon-metal segment                        2007   2008   2009    Change
Turnover                       euro million  54.0   61.0   60.5   -  0.8 %
Segment share of turnover             in %   65.0   67.4   71,5
EBITDA1                        euro million   4.0    6.8    4.2   - 38.2 %
EBIT1                          euro million   3.1    5.8    2.8   - 50.9 %
EBT                            euro million   2.6    5.3    2.1   - 60.4 %
Employees (31 December)                       107    108    106   -  1.9 %

Graphite segment                             2007  2008   2009    Change
Turnover                       euro million  29.1  29.5   24.1   - 18.3 %
Segment share of turnover             in %   35.0  32.6   28.5
EBITDA1                        euro million   3.4   2.4    0.0   -100.0 %
EBIT1                          euro million   1.5   0.7   -1.7  not stated
EBT                            euro million   0.6  -0.5  - 2.7  not stated
Employees (31 December)                       607   492    371   - 24.6 %

Share                                        2007  2008   2009    Change
Earnings                              euro   0.66  1.21   0.32  not stated
Cashflow from ordinary business
activities                            euro   1.49  1.52   1.97    29.6 %
Dividend                              euro   0.00  0.00   0.00 2   0.0 %

1 Earnings ratios before restructuring measures, 
  previous year's figures adapted to uniform group accounting principles
2 Proposal

Dividend passed to strengthen liquidity
Considering the course of business in 2009, and in view of the uncertain
situation in 2010, the primary objective is to secure liquidity. For this
reason the Supervisory Board and the Management Board think it is the right
decision not to distribute a dividend for fiscal year 2009. This also
supports the necessary strengthening of the equity.

Change in the Management Board
On 12 March 2010 the Management Board member responsible for the graphite
segment, Mr. Achim Carstanjen, at his own request and in agreement with the
Supervisory Board, resigned from his position as a member of Graphit
Kropfmühl AG's Management Board. Because of differing opinions concerning
the future strategic orientation of the company Mr. Carstanjen already had
asked to be released from his operative tasks on 15 December 2009. The
field of responsibility of Mr. Carstanjen now is covered by the Chief
Executive Officer Mr. Martin Ebeling.

Course of business 2010
We already have orders for essential quantities of our planned
silicon-metal production, and we therefore expect to fully utilise our
capacities and reach the turnover of 2009. Energy costs still are a burden
in the silicon-metal segment.

In the graphite segment we will start up a new micronising line in the 2nd
quarter. Furthermore we should be able to generate additional turnover on
new markets with lubricating and separating agents. The expected
development in China and our orientation towards high-quality graphite
products should lead to a corresponding increase of turnover in this
region. Provided that the forecasts for the general economic development
turn out to be true, we expect a turnover of approximately EUR 28.0 million
for 2010.

For the group we expect a turnover between EUR 88 million and EUR 90
million. Because of the generally uncertain and unstable situation of the
global economy, however, we can at this time not provide any reliable
turnover and earnings forecasts. From today's perspective, however, we
expect a slight improvement of earnings compared to the last fiscal year.

Financial calendar
Annual report 2009              31 March 2010 
3-months interim report 2010    12 May 2010 
Annual General Meeting, Munich  16 June 2010 - 10.00 a.m. 
6-months interim report 2010    11 August 2010 
9-months interim report 2010    10 November 2010 

Forward-looking statements
This press release contains statements about future developments that are
based on currently available information and may involve risks and
uncertainties, the result of which may be that the actual results may
differ from the forward-looking statements. Statements about future
developments must not be understood as guarantees. Future developments and
events rather depend on a variety of factors, they contain various risks
and imponderabilities and are based on assumptions that might turn out to
be incorrect. For example, these include unforeseeable changes of the
general political, economic, and social conditions.

Information on the company
Graphit Kropfmühl AG is a specialist for the production of silicon-metal
and a globally leading supplier of refined natural graphite, with locations
in Europe, Asia and Africa. The company that is listed in the Prime
Standard (ISIN: DE0005896005) provides its customers with silicon-metal and
graphite solutions for the most versatile applications. Silicon-metal is
used in the chemical, aluminium, semiconductor and solar cell industries.
High-quality graphite among others is used in lubricants, carbon brushes
for electric motors, and in the chemical industry, for example for thermal
insulation and energy saving programs.


17.03.2010 Ad hoc announcement, Financial News and Media Release
distributed by DGAP.
Media archive at www.dgap-medientreff.de and www.dgap.de

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Language:     English
Company:      Graphit Kropfmühl AG
              Langheinrichstraße 1
              94051 Hauzenberg
              Deutschland
Phone:        +49 (0)8586/609-197
Fax:          +49 (0)8586/609-111
E-mail:       ir@gk-graphite.com
Internet:     www.gk-graphite.com
ISIN:         DE0005896005
WKN:          589600
Listed:       Regulierter Markt in Frankfurt (Prime Standard); Freiverkehr
              in Berlin, Düsseldorf, München, Hamburg, Stuttgart
 
End of News                                     DGAP News-Service
 
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