Ergis

Press Release

13 May 2015, 11:12

The Ergis Group after 1st quarter of 2015: Very good financial results, implementation of investments before schedule

The ERGIS Group, a leader of plastics processing in the Central and Eastern Europe, generated revenue of nearly PLN 165 million after Q1 2015 (i.e. up by 0.7% compared to the same period of the previous year), operating profit of PLN 10.7 million (up by 16.8% compared to the same period of 2014) and net profit of PLN 7.8 million (up by 31.8% compared to Q1 2014).

The very good financial results resulted from investments carried out in the recent years, including modernisations of production lines, as well as a favourable situation in terms of raw materials in Q1 2015.

Recently, the Group has completed a programme of development investments with a value exceeding PLN 20 million, which consisted in an early launch of another line for flexographic print in Nowy Sącz-based Flexergis, and a launch of the second line for the production of PET tapes at ERGIS S.A.’s Oława Plant.

FINANCIAL PERFORMANCE - DETAILS

Financial results of the ERGIS Group after Q1 2015 are presented in the table:

in PLN '000

Q1 2015

Q1 2014

Change

Revenue

164,994

163,915

+0.7%

Operating profit

10,746

9,201

+16.8%

Gross profit

10,092

7,662

+31.7%

EBITDA

16,500

14,700

+12.2%

Unrealised foreign exchange differences

+254

+69

+268.1%

Net profit

7,816

5,930

+31.8%

The Group’s revenue in the first quarter was higher by 0.7% in relation to the same period of the previous year and was achieved despite the strengthening of zloty against euro.

The Group recorded an increase in the sales of industrial packaging (by 17.2%) as a result of replacing the machine park in the Oława plant, carried out for the last two years, and launching the production of nanoErgis film there. As a result of the development of the Flexergis’s machine park, the Group recorded an increase (by 3.1%) also in the segment of sales of printed packaging. Low prices of raw materials in the first quarter of 2015 also had a positive impact on the results.

The decrease recorded in the PVC soft film group (by 12.4%) concerned insulating films. The decrease in the rigid packaging film group (by 9.4%) resulted from severe price competition on the domestic market.

Gross profit and net profit generated in Q1 2015 were significantly higher than in the same period of 2014, both due to an increase in operating profitability, and lower interest costs.

INVESTMENT PROGRAMME

The Group completed before the schedule the implementation of the investment programme, accepted by the Supervisory Board in September 2014. The programme covered the following components:

  • the investment in the new line for flexographic print in Flexergis in Nowy Sącz with a value of PLN 8.5 million;
  • the investment in the second line for the production of PET tapes in ERGIS S.A.’s Oława Plant with the value of PLN 12 million.

We closed the first quarter with very good financial results that were mainly due to the effects of investments carried out in the recent years. It’s worth mentioning the increasing share of innovative products in the Company’s profits, giving special consideration to the greatest – so far – development achievement: i.e. introducing the unique nanoErgis stretch film to European markets. Moreover, it was yet another quarter when the majority of profit resulted from sales conducted on EU markets other than Polish. This proves that our Group for years has been taking advantage of the favourable climate to the development of industrial activity, which we witness in our part of Europe, said Tadeusz Nowicki, President of the Management Board of ERGIS S.A.

 

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The ERGIS Group is the leader in plastics processing in the Central and Eastern Europe. Out of its six manufacturing plants, four are situated in Poland and two in Germany. The Group’s profile includes manufacturing of packaging for food (films and PVC and PET-based barrier laminates, printed multilayer laminates) and industrial packaging (LLDPE stretch films and PET films). Moreover, ERGIS is a manufacturer of films for packaging pharmaceuticals, hydro-insulating films and PVC compounds. In 2014 the Group’s revenue exceeded PLN 667 million.

 

Additional information is also available at www.ergis.eu

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