EANS-News: Oxea GmbH / Oxea reports stable Q3 results

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quarterly report

Luxembourg (euro adhoc) - Highlights Q3 2012:

* Net sales were EUR365 million versus EUR383 million in the prior
year period * Gross profit was EUR48 million versus EUR48 million in
the prior year period * Operating profit was EUR40 million versus
EUR44 in the prior year period * Net income was EUR17 million versus
EUR22 million in the prior year period * Adjusted EBITDA was EUR46
million versus EUR49 million in the prior year period

Oxea, a leading global supplier of Oxo Intermediates and Oxo
Derivatives, today announced for the third quarter of 2012 continued
stable results with an adjusted EBITDA of EUR46 million after EUR46
million in Q2 2012 and EUR45 million in Q1 2012. Considering the
general summer seasonality in the Northern hemisphere and the
continued soft world economy, this stable earnings development on a
quarter to quarter basis repeatedly underpins the robustness of
Oxea's business model. Compared to the corresponding period of the
prior year, adjusted EBITDA was moderately impacted, with a drop of
6% as a result of the overall weak macroeconomic demand and its
impact on the global manufacturing industry. In the nine months of
2012, Oxea generated strong cash flows, mainly due to a significant
improvement of Trade Working Capital. Cash provided by operating
activities was EUR82 million compared with EUR78 million in the
corresponding period of the prior year. The strong financial position
allowed Oxea to complete the third optional redemption of 5% of the
outstanding Senior Secured Notes in August 2012. Within two years
after the Bond issue, Oxea has executed all three redemption options,
each of 5% of outstanding Senior Secured Notes at a redemption price
of 103% as permitted under the terms and conditions of the Indenture.
During the first nine months Oxea invested EUR60 million into its
business largely driven by the implementation of the strategic growth
projects, leading to a further shift to high margin downstream
derivatives within the product portfolio. The second production
facility for the manufacturing of specialty esters in Oberhausen has
been mechanically completed at the end of October. The third
production plant for carboxylic acids in Oberhausen is currently
being finalized and expected to be completed during Q1 2013.

Three months Nine months
In EUR million ended ended
Unaudited September 30 September 30
2012 2011 2012 2011

Net sales 364.9 382.8 1,116.1 1,150.9
Gross profit 47.7 48.5 141.4 171.5
SG&A (9.2) (8.4) (28.4) (27.6)
R&D (1.7) (1.6) (5.0) (4.6)
Other operating 3.0 5.4 16.8 8.5
income/expense
Operating profit 39.8 43.9 124.8 147.8
Net income 16.6 21.9 55.4 68.3
Adjusted EBITDA 45.7 48.6 136.3 170.7

Net sales
Net sales for the three months ended September 30, 2012 were EUR364.9 million, a
decrease of 4.7% compared with the corresponding period of the prior year.
Overall, volumes were in line with the Q3 2011. Oxo Intermediates volumes were
in line with the corresponding period of the prior year and Oxo Derivatives
volumes traded 3.2% higher. Of our revenues for the three months ended September
30, 2012, EUR162 million resulted from sales in Europe, EUR120 million in North
America, and EUR83 million in the rest of the world compared to EUR176 million,
EUR120 million, and EUR87 million, respectively, in the prior year period.

Gross profit Gross profit for the three months ended September 30,
2012 amounted to EUR47.7 million and traded essentially in line with
the corresponding period of the prior year.

Selling, general & administration expense (SG&A) SG&A expense for the
three months ended September 30, 2012 amounted to EUR9.2 million
compared with EUR8.4 million in the corresponding period of the prior
year, mainly due to higher consulting fees and personnel costs.

Other operating income/(expense) Net other operating income for the
three months ended September 30, 2012 amounted to EUR3.0 million
compared with a net other operating income of EUR5.4 million in the
corresponding period of the prior year. The decrease is primarily
attributable to lower insurance income.

Operating profit Operating profit for the three months ended
September, 2012 was EUR39.8 million compared with EUR43.9 million in
the corresponding prior year period, primarily as a result of higher
SG&A expense and lower other income as explained above.

Financial result Net financial expense was EUR14.4 million compared
with EUR10.8 million in Q3 2011 mainly due to the premium paid for
the optional bond redemption in August 2012 and net foreign currency
gains in the corresponding period of the prior year.

Net income Net income was EUR16.6 million compared with EUR21.9
million in the corresponding period of the prior year due to higher
SG&A expense, lower other income and lower net foreign currency gains
partly compensated by lower income taxes.

Adjusted EBITDA Adjusted EBITDA at EUR45.7 million compared with
EUR48.6 million in the corresponding period of the prior year was
mainly driven by higher SG&A expense and lower other income.

Cash flow The company continued to generate positive free cash flow
and during the first nine months of 2012, Oxea generated EUR82.4
million in cash from operating activities compared with EUR78.1
million in the corresponding period of the prior year. Higher inflows
from working capital were partly offset by lower earnings from
operating activities and higher income tax payments.

Cash used in investing activities was EUR60.2 million compared with
EUR21.6 million in the corresponding period of the prior year due to
higher spending for growth projects.

Cash used in financing activities was EUR94.4 million compared to
EUR130.4 million in the corresponding period of the prior year, which
included a payment to shareholders in the amount of EUR55 million.

Oxea is a global manufacturer of Oxo Intermediates and Derivatives
such as alcohols, polyols, carboxylic acids, specialty esters and
amines. These products are sold in the merchant market (where sales
are to third party customers) and used for the production of
high-quality coatings, lubricants, cosmetic and pharmaceutical
products, flavourings and fragrances, printing inks and plastics. In
2011, Oxea generated revenue of about EUR1.5 billion with its 1,365
employees in Europe, the Americas and Asia.

Please note:

This press release contains financial information regarding the
businesses and assets of OXEA S.à r.l. (the "Company") and its
consolidated subsidiaries (the "Group"). Such financial information
has not been audited, reviewed or verified by any independent
accounting firm. The inclusion of such financial information in this
press release or any related presentation should not be regarded as a
representation or warranty by the Company, any of its respective
affiliates, advisors or representatives or any other person as to the
accuracy or completeness of such information's portrayal of the
financial condition or results of operations by the Group.

This press release and related presentations (including on our
website) may contain information, data and predictions about our
markets and our competitive position. While we believe this data to
be reliable, it has not been independently verified, and we make no
representation or warranty as to the accuracy or completeness of such
information set forth in this document. Additionally, industry
publications and reports from which such information, data or
predictions may be obtained generally state that the information
contained therein has been obtained from sources believed to be
reliable but that the accuracy and completeness of such information
is not guaranteed and in some instances state that they do not assume
liability for such information. We cannot therefore assure you of the
accuracy and completeness of such information and we have not
independently verified such information. In addition, we have made
statements in this document regarding our industry and position in
the industry based on our experience and our own investigation of
market conditions. We cannot assure you that the assumptions
underlying these statements are accurate or correctly reflect the
state and development of, or our position in, the industry, and none
of our internal surveys or information has been verified by any
independent sources.

Certain statements in this document are forward-looking. By their
nature, forward-looking statements involve known and unknown risks
and uncertainties because they relate to events and depend on
circumstances that may or may not occur in the future.
Forward-looking statements are not guarantees of future performance.
These factors include, among others: the cyclical and highly variable
nature of our business and its sensitivity to changes in supply and
demand; adverse and uncertain global economic conditions; the highly
variable nature of raw materials costs and any loss of key suppliers
or supply shortages or disruptions; the competitive nature of our
industry; the ability to comply with current or future laws and
regulations relating to environmental, health and safety matters as
well as the safety of our products, related costs of maintaining
compliance and addressing liabilities as well as risks relating to
compliance with antitrust and tax laws; our reliance on a limited
number of suppliers for certain of our key raw materials; operational
risks, including the risk of environmental contamination and
potential product liability claims; operational interruptions at our
facilities due to events that are outside of our control such as
severe weather conditions, unscheduled downtimes, terrorist attacks,
natural disasters or other events that may interrupt or damage our
operations or the impact of scheduled outages on our results of
operations; the risk that our insurance coverage may not be
sufficient to cover all risks; risks relating to the global nature of
our operations, including, among others, fluctuations in exchange
rates; the loss of major customers or key customers for certain of
our products; the loss of key personnel; risks relating to
acquisitions and dispositions, including any impairment risks with
respect to historical acquisitions, our ability to successfully
integrate acquired businesses, and unexpected liabilities relating to
such acquisitions or contingent liabilities in connection with such
dispositions; the requirement to make further contributions to our
pension schemes; the failure to protect our intellectual property
rights; limitations on our ability to adjust the quality of certain
products that we manufacture; and potential conflicts of interests
with our principal shareholder.

These and other factors could adversely affect the outcome and
financial effects of the plans and events described herein.
Forward-looking statements contained in this document regarding past
trends or activities should not be taken as a representation that
such trends or activities will continue in the future. New risks can
emerge from time to time, and it is not possible for us to predict
all such risks, nor can we assess the impact of all such risks on our
business or the extent to which any risks, or combination of risks
and other factors, may cause actual results to differ materially from
those contained in any forward-looking statements. Neither the
Company nor the Group undertakes any obligation to update or revise
any forward-looking statements, whether as a result of new
information, future events or otherwise. You should not place undue
reliance on forward-looking statements, which speak only as of the
date of this document.

EBITDA is defined as net income for the year before financial result,
income taxes, depreciation and amortization. Adjusted EBITDA is
defined as EBITDA adjusted to remove the effects of certain non-cash
and non-recurring expenses and charges. EBITDA and Adjusted EBITDA
are supplemental measures of our performance and liquidity that are
not required by or presented in accordance with IFRS. EBITDA and
Adjusted EBITDA are not measurements of our financial performance or
liquidity under IFRS and should not be considered as an alternative
to profit for the period presented, results from operating activities
or any other performance measures derived in accordance with IFRS or
as an alternative to cash flow from operating activities as a measure
of our liquidity. We believe EBITDA and Adjusted EBITDA facilitate
operating performance comparisons from period to period and company
to company by eliminating potential differences caused by variations
in capital structures (affecting interest expense), tax positions
(such as the impact on periods or companies of change in effective
tax rates or net operating losses) and the age and book value and
amortization of tangible and intangible assets (which have an effect
on related depreciation expense). We also present EBITDA and Adjusted
EBITDA because we believe it these are frequently used by securities
analysts, investors and other interested parties in the evaluation of
similar issuers, the majority of which present EBITDA and Adjusted
EBITDA when reporting their results. Finally, we present EBITDA and
Adjusted EBITDA as measures of our ability to service our debt.

Further inquiry note:
Contacts:

Bernhard Spetsmann
Managing Director (Finance, IT)
bernhard.spetsmann@oxea-chemicals.com

Birgit Reichel
Communications/PR
birgit.reichel@oxea-chemicals.com

end of announcement euro adhoc
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company: Oxea GmbH
Otto-Roelen-Straße 3
D-46147 Oberhausen
phone: +49(0)208 693 3112
FAX: +49(0)208 693 3101
mail: birgit.reichel@oxea-chemicals.com
WWW: http://www.oxea-chemicals.com
sector: Chemicals
ISIN: XS0523636594
indexes:
stockmarkets: Open Market: Frankfurt
language: English