EANS-News: RHI AG / Record revenues and improved profitability in second quarter 2011

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quarterly report

Wien (euro adhoc) - RHI recorded all time high quarterly revenues in
the second quarter of 2011, exceeding the record level of the second
quarter of 2008 by more than 5%, in spite of an environment strongly
characterized by insecurity. The Steel Division´s revenues were
roughly 7% higher than the record figure of the third quarter of
2008. With record revenues in the nonferrous metals and environment,
energy, chemicals segments, revenues of the Industrial Division were
only slightly below the peak value of the fourth quarter of 2008.

In comparison with the reference quarter of 2010, the RHI Group´s
revenues increased by 9.7% to EUR 437.1 million in the second quarter
of 2011. The Steel Division recorded a 13.2% growth in revenues; in
the Industrial Division growth amounted to 3.1%. Second quarter 2011
sales volumes amounted to 503,194 metric tons compared with 551,711
metric tons in the second quarter of 2008. The significant revenue
per metric ton increase is primarily attributable to the increase in
prices, which were necessary due to the rise in raw material costs in
2010.

The operating result of the second quarter, at EUR 40.0 million,
remains at the level of the comparable period of 2010 of EUR 40.8
million, with the second quarter of 2010 containing a positive
one-off effect of EUR 7.9 million. The operating result margin, at
9.2%, thus still lagged behind that of the comparable quarter of 2010
at 10.2%. In comparison with the first quarter of 2011, the RHI Group
increased revenues by 5.6% and the operating result by roughly 37% in
the second quarter of 2011. The operating result margin of 7.1% of
the first quarter of 2011 was raised by 200 basis points.

The tax rate in the second quarter amounted to 12.0% (Q1/2011:
22.8%); the cash tax rate rose from 16.0% in the first quarter to
25.8% in the second quarter due to advance tax payments for the year
2011 and tax payments for the year 2010.

At the balance sheet date on July 1, 2011 the equity ratio amounted
to 22.5%, remaining unchanged compared to the first quarter as
dividend payment almost completely offset the gain in retained
earnings for the quarter. Cash and cash equivalents were also nearly
unchanged in comparison with the end of the first quarter of 2011 and
equaled EUR 86.6 million. Net debt rose from EUR 318.3 million to EUR
346.9 million, which was primarily attributable to the dividend
payment of roughly EUR 20 million in May.

Net cash flow from operating activities increased only marginally in
the second quarter of 2011 to cumulated EUR 29.1 million (Q1/2011:
EUR 26.8 million). This is primarily attributable to an increase in
receivables related to higher revenues.

2nd Quarter 1st Half-year
in EUR million 2011 2010 2011 2010
Revenues 437.1 398.5 850.9 740.7
EBITDA 53.0 52.2 95.4 97.1
EBITDA margin 12.1% 13.1% 11.2% 13.1%
Operating results 1) 40.0 40.8 69.2 74.4
Operating results margin 9.2% 10.2% 8.1% 10.0%
EBIT 40.0 38.6 69.2 70.3
EBIT margin 9.2% 9.7% 8.1% 9.5%
Profit before income
taxes 34.9 34.9 58.6 61.7
Profit for the year 30.7 27.6 49.0 49.1
Net cash flow from
operating activities 2.3 (6.2) 29.1 16.2
Investments in property,
plant and equipment and
intangible assets (10.2) (9.3) (15.1) (14.5)
Number of employees
at end of half-year 7,796 7,258

1) EBIT before restructuring costs

Steel Division In the second quarter of 2011, RHI´s Steel Division
increased revenues by 6.6% compared to the first quarter, thus
clearly outperforming world steel production with an increase of 2%
in the reference period. The operating result improved from EUR 6.1
million to EUR 20.6 million, with the result of the previous quarter
being strongly influenced by negative foreign currency effects. The
operating result margin amounted to 7.4%, significantly above the
margins of the previous quarters.

Industrial Division Although the winter repair business in the cement
industry ran out in the second quarter, the Industrial Division
raised revenues to EUR 149.3 million, up 3.3% on the first quarter of
2011. Compared to the second quarter of the previous year, the
increase was 3.1%. The operating result in the second quarter equaled
EUR 18.2 million; the operating result margin amounted to 12.2%,
versus 10.9% in the previous quarter. On June 16, 2011 the
acquisition of the Russian refractories manufacturer ZAO Podolsk
Refractories was finalized. Starting in 2012, the product quality on
site will be gradually improved as part of an investment and
technology transfer program.

Raw Materials Division The Raw Materials Division reported revenues
of EUR 54.8 million in the second quarter of 2011, versus EUR 40.6
million in the prior-year period. The operating result amounted to
EUR 1.2 million in the reporting period, which corresponds to a
margin of 2.2%.

Outlook In a stable macro-economic environment with unchanged foreign
currency exchange rates, RHI expects revenues comparable to the first
half in the second half of the year 2011. RHI assumes that in the
third quarter the EBIT margin will be comparable to the second
quarter 2011. In the fourth quarter of 2011 the EBIT margin for the
RHI Group will rise to 9.5%.

The half-year financial report 2011 and the online version are
available on RHI´s website www.rhi-ag.com.

Further inquiry note:
RHI AG
Investor Relations
Mag. Barbara Potisk-Eibensteiner
Tel: +43-1-50213-6123
Email: barbara.potisk@rhi-ag.com

end of announcement euro adhoc
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company: RHI AG
Wienerbergstrasse 9
A-1100 Wien
phone: +43 (0)50213-6123
FAX: +43 (0)50213-6130
mail: rhi@rhi-ag.com
WWW: http://www.rhi-ag.com
sector: Refractories
ISIN: AT0000676903
indexes: ATX Prime, ATX
stockmarkets: official market: Wien
language: English