EANS-News: Klöckner & Co SE / Performance positive in North America but weak in Europe, operating income (EBITDA) EUR45 million, further progress in implementing profitability action plan, EBITDA guid

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quarterly report

Duisburg (euro adhoc) - - Turnover raised by 24.0% to 1.9
million tons and sales by 22.6% to some EUR1.9 billion due to
acquisitions

- EBITDA EUR45 million, compared with EUR104 million boosted by windfall
profits in prior year
- Net income accordingly EUR-10 million, compared with EUR44 million in
prior year
- Earnings per share a EUR-0.10 as against a EUR0.65 in prior year
- Profitability action plan on track
- EBITDA guidance for Q2 EUR50 to EUR60 million with further improvement
in turnover compared with Q1
- Full-year guidance: Turnover growth of 5% and also sales above prior
year; increase in EBITDA only attainable, if economic environment in Europe
improves in second half-year

Figures relate to first three months relative to first three months of prior
year

Duisburg, May 9, 2012 - Turnover and sales sharply increased in Q1
2012, primarily due to the acquisition of Macsteel Service Centers
USA. At EUR45 million, operating income (EBITDA) was down on the
strong first quarter of 2011 - which was boosted by windfall profits
- but EUR31 million up on the preceding quarter and so within the
forecast range of EUR40 to EUR50 million. Gisbert Rühl, Chairman of
the Management Board of Klöckner & Co SE: "The Macsteel acquisition
meant we could particularly benefit from the robust economic trend in
the USA. In Europe, as we expected, the environment remains
difficult. With substantial overcapacity dominating the market,
competition is very fierce. On top of this, customers continue to be
unsettled by the ongoing sovereign debt crisis."

Strong growth in turnover and sales, earnings down on prior year
Klöckner & Co increased turnover in the first three months of fiscal
2012 by 24.0% to 1.9 million tons compared with the prior-year
quarter (1.5 million tons), as a result of acquisitions. Compared
with Q4 2011, turnover showed an increase of 13.5% due to the
seasonal upturn in business. The divergent trend in the turnover
performance of the Europe and Americas segments experienced in 2011
continued in even more pronounced form in the first quarter. In the
Europe segment, turnover was 5.1% down on the prior year owing to the
difficult economic environment and portfolio streamlining. Germany
was the only country where Klöckner & Co generated slight growth in
turnover, whereas business conducted in Spain once again declined
substantially. In contrast, turnover in the Americas segment
increased by 125.4% compared with Q1 2011, mainly due to the
acquisition of Macsteel. Also on an organic basis, however, Americas
segment turnover was well ahead of both, the market and the
prior-year period, with growth of 11.8%. Organic turnover for the
Group as a whole showed a slight 1.4% decrease due to the ground lost
in Europe. Sales followed the trend in turnover, increasing by 22.6%
relative to the prior-year period to some EUR1.9 billion in Q1 2012.
Excluding acquisitions, Group sales were broadly on a par with the
prior year (-0.5%). Operating income (EBITDA), at EUR45 million, was
below the prior-year figure of EUR104 million - which was boosted by
large windfall profits - but tripled compared with the figure for Q4
2011. EBIT for the first three months of the fiscal year came to
EUR18 million (Q1 2011: EUR86 million) and earnings before taxes
(EBT) to EUR-6 million (Q1 2011: EUR66 million). Net income
accordingly dropped from EUR44 million to EUR-10 million. Basic
earnings per share came to EUR-0.10, compared with a EUR0.65 in the
prior-year quarter.

Strong balance sheet and financing structure retained Total assets
increased reflecting the usual seasonal upturn in business activity
following the winter. The main driver behind the increase was a rise
in funds tied up in net working capital from EUR1,534 million to
EUR1,656 million. The increased need for net working capital was also
reflected in net financial debt, which rose as expected from EUR471
million at the year-end to EUR573 million. Net financial debt was
nonetheless kept low relative to equity, with gearing of 35%. The
equity ratio stood at roughly 38% as of March 31, 2012, compared with
39% at the 2011 year-end. Liquidity remains at a high level of EUR937
million, compared with EUR987 million as of December 31, 2011.

Further progress on profitability action plan Back in September 2011,
Klöckner & Co responded to the reduced growth forecasts as a result
of the ongoing sovereign debt crisis in Europe by initiating a
profitability action plan. Alongside cuts in administration costs and
sales overheads, the plan centers on the discontinuation of
insufficiently profitable business activities. The number of jobs in
Europe is to be cut by 700 as a result. Some 400 jobs had been cut by
the end of the first quarter. Initial steps were also completed in
the first quarter to close unprofitable locations and business
activities. Subsidiaries in Spain and Eastern Europe are particularly
affected. The profitability improvement measures will be fully
implemented by the middle of the year. Alongside implementation of
the restructuring measures in Europe, an additional focus was on the
further integration of Macsteel. To this end, the branding was
standardized, management structures, administration and procurement
brought together, and the groundwork laid for IT integration in the
second quarter. In addition to the increased significance of the US
business, the considerable synergies and cross-selling effects
resulting from completion of the integration are leading to an
above-average contribution to earnings from the Americas segment.

Outlook for 2012 For fiscal year 2012 Klöckner & Co continues to
expect a rise in turnover by 5% and also a rise in sales compared
with the prior year. The increase is expected - despite portfolio
streamlining measures and the weak market development in Europe - to
be achieved by last year's acquisitions. The targeted improvement in
operating income (EBITDA) for the full year is only achievable if the
economic environment in Europe improves in the second half-year. If
not, the Company expects from today's perspective that operating
income will be broadly on a par with the prior year. An expected
increase in EBITDA in the USA from the Macsteel acquisition and a
more robust overall economic trend would be countered here - along
with the earnings improvement from the profitability action plan - by
weaker operating performance in Europe. For the second quarter, the
Company anticipates operating income (EBITDA) of between EUR50 and
EUR60 million, provided the economic growth prospects do not further
deteriorate in Europe and prices for steel products do not plummet.
The Americas segment will once again make an above-average
contribution to this result compared to their sales impact. While the
first half of the year is focused entirely on implementing the
profitability action plan in Europe and completing the integration of
Macsteel acquired in the prior year, Klöckner & Co's financial
headroom and solid balance sheet mean the company is best placed to
continue its long-term growth strategy, "Klöckner & Co 2020", in the
second half of the year.

Further inquiry note:
Dr. Thilo Theilen
Leiter Investor Relations & Corporate Communications
Telefon: +49 (0)203 307 2050
E-Mail: thilo.theilen@kloeckner.de

end of announcement euro adhoc
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company: Klöckner & Co SE
Am Silberpalais 1
D-47057 Duisburg
phone: +49(0)203-307-0
FAX: +49(0)203-307-5000
mail: info@kloeckner.de
WWW: http://www.kloeckner.de
sector: Metal Goods & Engineering
ISIN: DE000KC01000
indexes: CDAX, Classic All Share, Prime All Share
stockmarkets: free trade: Berlin, München, Hamburg, Düsseldorf, Stuttgart,
regulated dealing/prime standard: Frankfurt
language: English