Acerinox obtains 103 million euros Ebitda in the third quarter of the year

The 0.50 euro dividend per share approved at the General Shareholders’ Meeting has been paid out in full

The turnover for the quarter totalled 1.22 billion euros, representing a slight decrease of 2% in comparison with the second quarter, raising the net sales posted during the first nine months to 3.661 billion euros (a figure 5% lower than in 2018).

Acerinox obtained, during the third quarter of the year, 103 million euros, a figure 7% higher than in the preceding quarter, despite having been adversely affected by the inventory adjustment of 9 million euros at the net realizable value, due to the sharp increases, mainly of nickel, since July.

 

 In contrast, it was favoured by the sale of the warehouse in Aguamansa (California) for 7 million euros, which was completed as a result of the success of the strategy of increasing the direct delivery to customers from the factories.

 

After taxes and minority interests, net result was 44 million euros in the third quarter, a figure 19% higher than that obtained during the previous quarter. Throughout the first nine months the figure totalled 113 million euros, 49% less than in 2018, due to fall in consumption and low prices.

 

The turnover for the quarter totalled 1.22 billion euros, representing a slight decrease of 2% in comparison with the second quarter, raising the net sales posted during the first nine months to 3.661 billion euros (a figure 5% lower than in 2018).

 

Melting production, standing at 542,425 tonnes, decreased by 5% compared to the second quarter of 2019. The Group produced a total of 1.74 million tonnes between January and September, 10% less than in the first nine months of 2018.

 

Acerinox reduced its net financial debt by 582 million euros (by 59 million euros with respect to 30 June).

 

Return to shareholder

 

The General Shareholders’ Meeting of Acerinox S.A. held on 11 April in Madrid approved an increase in the shareholder remuneration totalling €0.50 per share, compared with the figure of €0.45 per share paid in recent years.

 

The approved dividend represents an increase of 11% compared to the previous fiscal year and it has been distributed between a first payment charged to unrestricted reserves in the amount of €0.30 per share (payable on 5 June 2019) and a second payment charged to the Share Issuance Premium account in the amount of €0.20 per share payable on 5 July 2019 (54 million euros).

 

In addition, the Shareholders’ Meeting agreed to a capital reduction of up to 2% via the redemption of treasury shares acquired by implementing the buyback programme approved by the Board of Directors in December. 5,521,350 Acerinox, S.A. shares, equivalent to 2% of the share capital, were redeemed on the Madrid and Barcelona Stock Markets on 13 June. The number of outstanding shares now totals 270,546,193.

 

Negotiations in the plant of Campo de Gibraltar

 

The new Collective Agreement and the Downsizing Plan are still being negotiated with the labour unions of the Campo de Gibraltar plant.

 

The US Senate’s approval of the amendment of the Dual Taxation Agreement between Spain and the United States

 

On 16 July the United States Senate ratified the new Protocol, signed by the two States in 2013,

which amends the 1990 Dual Taxation Agreement between Spain and the United States.

 

The Protocol modifies aspects of the Dual Taxation Agreement signed by Spain and the United States which are of great significance for the Group, including the elimination of interest withholdings and withholdings on dividends when the parent company holds at least 80% of the shares with voting rights during the previous twelve months.

 

This will allow the Acerinox Group to avoid 10% retentions in the North American Stainless’ distribution of dividends to the parent company.

 

The amendments of the new protocol will enter into force the next 27th November.

 

Outlook

 

The decrease in industrial activity, together with overproduction by Asian countries, in particular

China and Indonesia, have been putting market prices under great pressure. Under these

circumstances, which include the usual year-end closing procedures in inventory controls, we predict that the markets are going to maintain a behaviour similar to the current fiscal year, without any foreseeable signs of recovery for the time being.

 

The Acerinox results for the fourth quarter will be aligned with those of the previous quarter,

backed-up by business in the United States, although they may be subject to change depending on the results of the final negotiations on the labour force adjustment plan of the Campo de Gibraltar factory.