Kirn. The SIMONA Group managed to expand revenue in 2019 by 3.5 per cent to €432.5 million, buoyed in particular by a solid performance of its US business. Due to sluggish demand within the European economy, it fell short of its revenue guidance of €435-450 million. Earnings before interest and taxes (EBIT) fell from €33.2 million to €29.4 million. Given the economic fundamentals, however, the plastics-processing company is satisfied with its EBIT margin of 6.8 per cent (prev. year: 8.0 per cent). The strategic initiatives spearheaded in 2019 for the purpose of improving profitability within its European semi-finished parts business are showing the first signs of success. EBIT in the first quarter of 2020 rose substantially to €9.6 million (prev. year: €8.4 million), despite the initial impact of the coronavirus pandemic.

Revenue growth in 2019 was attributable almost entirely to business activities in the United States. The first-time inclusion of extrusion company SIMONA PMC for a full annual period and a consistently solid performance within the industrial products and aviation business helped to drive revenue up by 15.7 per cent to €131.9 million (prev. year: €114.2 million) in the corresponding sales region. The region encompassing the Americas saw its share of revenue increase to over 30 per cent. In Europe, revenue receded by 1.5 per cent to €269.7 million (prev. year: €273.5 million) due to the marked downturn in the economy in the second half of the year. In Asia, meanwhile, business performance was influenced by a weak first quarter. However, thanks to intensive market cultivation, this region succeeded in driving revenue up by 2.3 per cent to €30.9 million for the year as a whole (prev. year: €30.2 million).

Both product categories contributed to growth in 2019: Semi-Finished Products grew by 3.1 per cent to €344.1 million (prev. year: €333.7 million), fuelled primarily by persistently solid business in the area of aircraft interiors. Business within the core market centred around sheet products for the chemical industry, the focus being on tank and equipment engineering, remained stable despite shrinking demand within the sector as a whole. Sales of PVC foam sheets for applications in the field of digital printing and construction were down year on year. Benefiting from a newly structured product range, SIMONA has now managed to improve business within this area again. The product area comprising Pipes and Fittings met its growth targets and saw revenue expand by 5.0 per cent to €88.4 million (prev. year: €84.2 million). This gain was attributable primarily to protective-jacket pipes and products used in the rehabilitation of infrastructure piping systems. Project-based industrial products business also recorded forward momentum.

Against the backdrop of a challenging economic environment, the SIMONA Group is satisfied with its bottom-line result for the 2019 financial year. EBIT amounted to €29.4 million (prev. year: €33.2 million). At 6.8 per cent, the EBIT margin is within the guidance range and within the corridor of 6-8 per cent defined as a medium-term strategic target. Net cash from operating activities grew substantially to €51.6 million (prev. year: €34.8 million). At the virtual general meeting on June 5, 2020, a dividend of €10 will be proposed to the shareholders. Thus, SIMONA has reduced its dividend compared with the original dividend proposal of €14, which the Management Board had put forward prior to the spread of the coronavirus pandemic. The aim is to provide shareholders with an adequate return on their investment, while also taking into account the impact of the coronavirus pandemic on liquidity required for the future.

Outlook and Q1/2020

The global coronavirus pandemic is having a significant impact on the short- to medium-term performance of the global economy. SIMONA felt the effect of these developments in the first quarter, although its business performance as a whole remained stable. Based on revenues of €107.7 million (prev. year: €111.0 million), SIMONA recorded a solid operating result. EBIT rose by 14.3 per cent compared to the same quarter last year, taking the figure to €9.6 million (prev. year: €8.4 million).

"2019 was a year dominated by difficult economic conditions, but also a period of significant change at SIMONA. We succeeded in achieving a solid performance in financial terms, introducing a new leadership team at Management Board level and charting an important strategic course for a successful future. Our solid earnings performance in the first quarter of 2020 illustrates that we are on the right track with the strategic projects aimed at an application- and process-driven realignment of our semi-finished parts business in Europe," says Matthias Schoenberg, CEO of SIMONA AG. "The coronavirus pandemic poses challenges worldwide and will affect our prospects for short- to medium-term growth. Due to the uniqueness of this crisis, we are not able to draw on fundamental data that would allow a reliable forecast for the year as a whole. We analyse scenarios on a regular basis for the purpose of gauging the impact of the crisis on our company. Thanks to our financial solidity and good cash position, even worst-case calculations have shown that we will emerge from this pandemic safely," adds Schoenberg.