Ergis

Press Release

13 November 2012, 12:28

THE ERGIS GROUP AFTER THE THIRD QUARTER OF 2012: GOOD FINANCIAL RESULTS, FIRST EFFECTS OF THE INVESTMENT PROGRAMME

Press release

 

Warsaw, 13 November 2012

 

 

THE ERGIS GROUP AFTER THE THIRD QUARTER: GOOD FINANCIAL RESULTS, FIRST EFFECTS OF THE INVESTMENT PROGRAMME

 

 

In the third quarter of 2012, the ERGIS Group, a leader in plastics processing in the Central and Eastern Europe, generated sales revenue of PLN 171.6 million, which indicates an increase of 6.4% as compared to the results achieved in the previous year. Operating profit amounted to PLN 7.8 million (up by 38.5%), while net profit totalled PLN 4.8 million compared to the loss recorded in the same period of the previous year. An increase in profitability indicates initial effects of the investment programme completed in the first half of 2012.

 

Cumulatively, the revenue after the three quarters exceeded PLN 483 million (an increase of almost 2% compared to the last year), and the operating profit amounted to PLN 12.9 million (down by 5.8% compared to the same period in 2011). This is attributable to the second quarter which brought worse results than the same period of the previous year. Net profit reached PLN 7.2 million which represents a growth of 304% and is to a some extent a result of changes in foreign exchange rates.

 

At present, the Group is focused on achieving full production capacity on the line for the production of a thirty-three-layer nano stretch film, which was launched in the first half of 2012 in Oława. Another objective is to increase the production efficiency of PET film production on the line transferred from Berlin to Wąbrzeźno.

 


FINANCIAL RESULTS – DETAILS

 

Financial results of the ERGIS Group after three quarters of 2012 are presented in the table below:

 

 

PLN '000

 

3Q 2012

 

3Q 2011

 

Change

 

1-3Q 2012

 

1-3Q 2011

 

Change

Revenue

171,558

161,306

+6.4%

483,604

474,379

+1.9%

EBITDA

13,127

10,670

+23.0%

28,200

28,500

-1.1%

Operating profit

7,847

5,667

+38.5%

12,850

13,643

-5.8%

Unrealised exchange rate differences

316

-6,832

-

3,966

-6,598

-

Net profit

4,805

-2,759

-

7,274

1,799

+304,3%

 

 

Despite the decline of the EUR exchange rate (by more than 3% as compared to the previous quarter and by 1.3% as compared to the same period of the previous year), sales revenue in the third quarter of 2012 was over 6% higher compared to the figure for the same period of the previous year (approx. 2% cumulatively).

 

Attention should be drawn to high sales dynamics of stretch films (8,6%), PVC rigid films (18.3%) and printed packaging (15.6%). The increases are attributable to the new production line for nano stretch film put into operation in Oława, an increased competitiveness due to the relocation of rigid film production from Berlin to Wąbrzeźno, as well as a launch of a new line for lamination of packaging in Nowy Sącz.

 

The increase in sales of soft films is the result of higher exports (up by 42%) which, in turn, is largely due to successful sales of insulating films and sheets and veneer films.

 

 

On the profitability side, the third quarter was the best quarter for the Group in all of 2012. The results achieved were better at all levels. An improvement in operating profitability was recorded in the case of both Ergis-Eurofilms S.A. as well as other Group companies.

 

Cumulatively, the Group's EBITDA was slightly lower than in the same period of last year (PLN 28.3 million in 2012 compared to PLN 28.5 in 2011), which results from difficulties in selling stretch films in the second quarter of 2012.

 

Gross profit and net profit levels in the third quarter of 2012 and cumulative figures are clearly better than last year, which is due to the fact that foreign exchange rates were favourable from the perspective of financial expenses. In the third quarter of 2012, foreign exchange differences were positive and amounted to PLN +0.3 million (cumulatively: PLN +3.97 million). In contrast, in the third quarter of 2011, they were negative and totalled PLN -6.83 million (cumulatively: PLN -6.60 million).

 

Tadeusz Nowicki, President of the Management Board of ERGIS-EUROFILMS:

“We are satisfied to note that the greatest improvement of results in the third quarter concerned those three sectors of the Group’s operations which were the subject of the investment programme completed in the second quarter. We are consistently translating our declarations into practice, and we are currently focused on making the best use of the production capacity of the line for the production of thirty-three-layer stretch film nano in Oława, which was launched in the first half of 2012, and increasing the effectiveness of PET film production in Wąbrzeźno.Hopefully, the symptoms of economic downturn will not stand in our way.”  

 

 

For more information, contact:

Małgorzata Kot, ERGIS - EUROFILMS S.A.

tel. 604 159 103, 604 159 159

e-mail: kot@ergis.eu

 

Magda Kołodziejczyk, M+G

tel. (22) 416 01 02, 501 16 88 07

e-mail: magda.kolodziejczyk@mplusg.com.pl

 

 

 

ADDITIONAL INFORMATION

 

ERGIS Group is Poland’s largest manufacturer of PE stretch film (stretch film used for e.g. wrapping loads on pallets), as well as Central and Eastern Europe's leading manufacturer of PVC products: soft films (insulation and special purpose), compounds, wallpaper and windowsills. An important segment in the Group’s operations, is the manufacturing of PVC, PVC/PE and PET rigid films, used for the manufacturing of pharmaceuticals, food and technical packaging. The Group is also a manufacturer of flexible food wraps. The Ergis Group is an important manufacturer of PET tapes (used for fastening medium heavy and heavy products and loads), PVC thermoshrink films (used, e.g. for food packaging) as well as a distributor of BOPP film (used mainly for packaging manufacturing).

 

Additional information is also available at www.ergis-eurofilms.eu