Revenue was $257.0 million in the first quarter 2015, a 6% decrease from the same period in 2014
EBITDA() was $20.4 million in the first quarter 2015, a 2% increase from the same period in 2014
EPS on a fully diluted basis was $0.10 in the first quarter 2015, a 29% decrease from the same period in 2014
Annualized return on capital employed increased to 12.7% in the first quarter 2015, from 9.7% in the same period in 2014
Cash flows from operating activities were $3.8 million in the first quarter 2015, compared to $5.7 million in the same period in 2014
As of March 31, 2015, cash on the balance sheet was $99.3 million; net debt was $86.8 million, a reduction of $1.1 million in the first quarter of 2015
Amsterdam, 7 May 2015 (Regulated Information) --- AMG Advanced Metallurgical Group N.V. ("AMG", EURONEXT AMSTERDAM: "AMG") reported first quarter 2015 revenue of $257.0 million, a 6% decrease from $274.9 million in the first quarter 2014. Net income attributable to shareholders for the first quarter 2015 was $2.7 million, or $0.10 per fully diluted share, a 32% decrease from $3.9 million, or $0.14 in the first quarter 2014. EBITDA increased 2% to $20.4 million in the first quarter 2015 from $20.1 million in the first quarter 2014.
Dr. Heinz Schimmelbusch, Chairman of the Management Board and CEO, said, "Despite weakening metals prices and the unfavorable translation impact of foreign currency on reported earnings during the quarter, AMG's efforts to reduce cost and optimize our product portfolio have resulted in improved year over year EBITDA. Annualized return on capital employed also improved to 12.7% in the first quarter of 2015 from 9.7% in the first quarter of 2014.
In the first quarter, AMG Critical Materials successfully maintained year over year gross margins, despite falling metals prices, through improved sales volumes and a continued focus on providing higher value added products. AMG Engineering improved EBITDA by 104% compared to the same period in 2014 due to improving revenues and lower SG&A costs.
As previously announced, AMG completed the sale of a 40% equity stake in AMG Graphit Kropfmühl GmbH. This transaction will result in a substantial reduction in net debt in the second quarter of 2015."
In 000's US Dollar
Q1 '15 Q1 '14 Change
Revenue $256,991 $274,852 (6%)
Gross profit 43,302 46,352 (7%)
Gross margin 16.8% 16.9%
Operating profit 11,553 10,811 7%
Operating margin 4.5% 3.9%
Net income attributable to shareholders 2,676 3,919 (32%)
EPS- Fully diluted 0.10 0.14 (29%)
EBIT (1) 13,207 11,919 11%
EBITDA (2) 20,388 20,068 2%
EBITDA margin 7.9% 7.3%
Cash flows from operating activities 3,797 5,659 (33%)
EBIT is defined as earnings before interest, tax and excludes non-recurring items
EBITDA is defined as earnings before interest, tax, depreciation and amortization and excludes non-recurring items
AMG Critical Materials
Q1 '15 Q1 '14 Change
Revenue $202,288 $226,087 (11%)
Gross profit 31,206 33,580 (7%)
Operating profit 10,656 11,724 (9%)
EBITDA 17,273 18,538 (7%)
AMG Critical Materials' first quarter 2015 revenue decreased $23.8 million, or 11%, to $202.3 million. The decline was primarily the result of unfavorable Euro to US Dollar currency translation effects, lower metal prices and product portfolio optimization.
Despite increased sales volume, the impact of lower antimony metal prices compared to the first quarter of 2014 and a reduction in low margin products at AMG Superalloys and AMG Aluminum, due to product mix optimization initiatives, negatively impacted revenues.
Gross profit decreased $2.4 million, or 7%, to $31.2 million, primarily due to foreign currency translation effects. However, AMG Critical Materials' first quarter 2015 gross margin remained consistent at 15% compared to the same period in 2014.
First quarter 2015 EBITDA margin was 9%, up 1% from the first quarter of 2014. Consistent gross margins and SG&A reductions of 8%, due to currency effects and cost cutting measures, resulted in an improved EBITDA margin.
Q1 '15 Q1 '14 Change
Revenue $54,703 $48,765 12%
Gross profit 12,096 12,772 (5%)
Operating profit (loss) 897 (913) N/A
EBITDA 3,115 1,530 104%
AMG Engineering's first quarter 2015 revenue increased $5.9 million, or 12%, to $54.7 million due to improved order backlog at the end of 2014, relative to the end of 2013.
First quarter 2015 gross margin decreased to 22% from 26% in the first quarter of 2014 due to product mix effects and cost overruns in certain long-term projects nearing completion.
EBITDA increased by $1.6 million, or 104%, to $3.1 million in the first quarter of 2015 due to lower SG&A costs.
AMG Engineering signed $51.9 million in new orders during the first quarter of 2015, a 0.95x book to bill ratio. Order backlog was $116.4 million as of March 31, 2015 and excluding the impact of currency, the backlog decreased 3% from December 31, 2014. Heat treatment and induction furnaces accounted for approximately 58% of the order intake.
AMG's first quarter 2015 SG&A expenses were $30.1 million compared to $35.0 million in the first quarter of 2014, a decrease of 14%. This decline was due to lower employee expenses of $1.7 million and a reduction of $1.9 million in legal and professional fees. Foreign currency translation effects, cost cutting initiatives and lower transaction related legal and professional fees drove the improvement.
In the first quarter of 2015, AMG incurred $1.7 million in non-recurring charges compared to $0.8 million in the first quarter of 2014, which are not included in the calculation of EBITDA. These charges relate to the previously announced restructuring activities in AMG Engineering of $0.9 million and restructuring expenses incurred within AMG Critical Materials of $0.8 million, primarily associated with the divestiture of peripheral assets.
March 31, 2015 December 31, 2014 Change
Total debt $186,103 $195,878 (5%)
Cash and cash equivalents 99,315 108,029 (8%)
Net debt 86,788 87,849 (1%)
AMG had a net debt position of $86.8 million as of March 31, 2015. Net debt and gross debt decreased $1.1 million and $9.8 million, respectively, from December 31, 2014.
Cash flows from operating activities were $3.8 million in the first three months of 2015 compared to $5.7 million in the same period in 2014.
Capital expenditures declined $2.1 million in the first three months of 2015 compared to the same period in 2014. The $3.8 million of capital spending in the first three months of 2015 included $2.1 million of maintenance capital. The largest expansion capital project was for AMG's titanium aluminides business.
Including the $99.3 million of cash, AMG had $173.1 million of total liquidity as of March 31, 2015.
AMG's financial statements are prepared in US Dollars, so fluctuations in the exchange rate between the US Dollar and other currencies, primarily the Euro and Brazilian Real, have an effect on the results of operations and on the reported value of assets and liabilities as measured in US Dollars.
The appreciation of the US Dollar as of March 31, 2015 compared to December 31, 2014, resulted in a decrease of $58.5 and $46.4 million in assets and liabilities on the balance sheet, respectively. The appreciation of the US Dollar compared to the Euro in the first quarter of 2015 in relation to the first quarter of 2014, resulted in a reduction in revenue and EBITDA of $27.3 million and $2.3 million, respectively.
In this challenging environment, AMG will continue to reduce cost, optimize its product portfolio and maintain a conservative balance sheet.
Despite weakening metals prices and the unfavorable translation impact of foreign currency on reported earnings, AMG expects to generate EBITDA in-line with prior year and improve its return on capital employed.
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AMG EUR 8,159 -1,105 vol. 989.005