EANS-Adhoc: RHI AG / Improved revenues and earnings situation in the first quarter

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quarterly report

15.05.2012

Revenues of the RHI Group increased to EUR 436.9 million in the first
quarter of 2012, up 5.6% on the comparable period of 2011. While the
Steel Division recorded an increase in revenues of 6.2%, revenues in
the Industrial Division fell slightly by 1.1%. Despite negative
foreign currency effects, the operating result of the first quarter
increased by 15.1% to EUR 33.6 million compared with the reference
period of 2011 and corresponds to EBIT as no restructuring costs were
incurred. The EBIT margin improved from 7.1% to 7.7%.

As of March 31, 2012, the equity ratio amounted to 26.7%, after 26.0%
at December 31, 2011. Cash and cash equivalents increased by EUR 9.6
million compared with the end of 2011 and amounted to EUR 154.1
million. Despite the acquisition of Stopinc AG and significantly
higher investments, net debt rose only slightly to EUR 363.1 million,
after EUR 361.5 million at December 31, 2011.

Net cash flow from operating activities increased to EUR 45.0 million
in the first quarter of 2012 (Q1/2011: EUR 26.8 million). Due to the
construction of a fusion plant in Norway and the increase in the
stake held in Stopinc AG from 50% to 100% in order to strengthen the
segment of special products for the steel and nonferrous metal
production, net cash flow from investing activities increased to EUR
(41.9) million, after EUR (2.8) million in the first quarter of 2011.

1st Quarter
in EUR million 2012 2011 Change
Revenues 436.9 413.8 5.6%
EBITDA 47.6 42.4 12.3%
EBITDA margin 10.9% 10.2% 0.7pp
Operating result1) 33.6 29.2 15.1%
Operating result margin 7.7% 7.1% 0.6pp
EBIT 33.6 29.2 15.1%
EBIT margin 7.7% 7.1% 0.6pp
Profit before income taxes 35.4 23.7 49.4%
Profit 32.0 18.3 74.9%
Net cash flow from operating
activities 45.0 26.8 67.9%
Investments in property, plant
and equipment and intangible assets (30.5) (4.9) (522.4)%
Number of employees
at end of quarter 8,182 7,344 11.4%
Average number of employees Q1 8,091 7,319 10.5%

Steel Division

While sales volume in the Steel Division fell slightly by 1.3% in
comparison with the first quarter of 2011, revenues were up 6.2% as
price increases were implemented. Further price adjustments, which
became necessary due to an increase in input costs, were successfully
negotiated in the past quarter and will continue to improve the
earnings situation starting in the second quarter of 2012.

Revenues in the Steel Division, at EUR 279.1 million in the first
quarter of 2012, were far higher than the revenues of the first
quarter of 2011 of EUR 262.7 million and slightly below the figure of
the fourth quarter of 2011 of EUR 281.5 million. EBIT amounted to EUR
12.8 million in the first quarter,

after EUR 6.1 million in the prior-year reference period. The EBIT
margin improved from 2.3% to 4.6% due to price adjustments, but was
affected by negative foreign currency effects.

Industrial Division The sales volume in the Industrial Division
dropped 5.9% in comparison with the first quarter of 2011 because the
cement business was weaker. The recovery of the markets back to
pre-crisis levels is proceeding, but they still show a highly diverse
picture depending on region and industry segment.

Revenues of the Industrial Division, at EUR 143.0 million in the
first quarter of 2012, fell slightly short of the revenues of EUR
144.6 million recorded in the first quarter of 2011 and were
significantly lower than the record revenues of EUR 181.1 million in
the fourth quarter of 2011 as fewer projects were invoiced. EBIT
amounted to EUR 13.1 million in the first quarter, after EUR 15.8
million in the prior-year reference period. The EBIT margin decreased
from 10.9% to 9.2% due to a massive increase in costs of raw
materials containing zirconium and to negative foreign currency
effects.

Raw Materials Division The Raw Materials Division generated revenues
of EUR 60.2 million in the first quarter of 2012, after EUR 50.6
million in the comparable period of the previous year. The main
reason for the increase were the significantly higher external
revenues related to the acquisition of Premier Periclase Ltd. in
September of the past year; these revenues amounted to EUR 14.8
million in the first quarter of the reporting year, after EUR 6.5
million in the first quarter of 2011. Internal demand within the
group was roughly at the level of the prior-year reference period.

EBIT amounted to EUR 7.7 million in the first quarter, after EUR 7.3
million in the comparable period of the previous year, and
corresponds to an EBIT margin of 12.8% and 14.4%, respectively.

Outlook In a stable macroeconomic environment and with unchanged
foreign currency exchange rates, RHI expects a similar level of
revenues in the Steel Division in the second quarter, significantly
higher revenues in the Industrial Division as well as a higher EBIT
margin than in the first quarter of 2012. Price increases and the
cost cutting program initiated in 2012 in combination with a positive
contribution to earnings of the higher level of backward integration
lead us to expect a higher margin for the entire year 2012 than in
the past financial year.

The interim financial statements as of March 31, 2012 as well as the
online version of the quarterly financial report are available on the
RHI website www.rhi-ag.com.

Further inquiry note:
RHI AG
Investor Relations
Mag. Simon Kuchelbacher
Tel: +43-1-50213-6676
Email: simon.kuchelbacher@rhi-ag.com

end of announcement euro adhoc
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issuer: 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