WIESBADEN (dpa-AFX) - SGL Carbon SE (SGLFF.PK) announced that it currently expects the renewed deterioration in the overall steel markets to have a negative impact on graphite electrode profitability going forward despite past and ongoing cost cutting measures.
SGL noted that it now expects earnings contribution from the Business Unit Performance Products to significantly decline in the final quarter of this year compared to the first three quarters. The company also noted that the significant improvement in the 2015 EBIT of the Business Unit PP is no longer achievable and the PP EBIT 2015 is now expected to come in slightly below the 2014 level of EUR 26 million, before non-recurring effects. SGL said its outlook for a significant increase in the 2015 EBIT before non-recurring effects compared to the EUR 3 million reported in 2014 remains unchanged.
Looking ahead for 2016, the company anticipates the graphite electrode business to be EBIT negative in 2016, resulting in a significant deterioration of the EBIT of the Business Unit PP. The company said it is confident that the technical carve out process can be completed well ahead of schedule, i.e. approximately in mid 2016. The company also projects significant decline in 2016 EBIT before non-recurring effects for 2016.
Simultaneously, SGL Group said it is reviewing further site optimization and capacity reduction measures including potential site closures as well as further reductions in personnel from adapting its business model. The company expects additional restructuring expenses in 2015 in a mid to high double digit million EUR amount, of which the majority is expected to be non-cash.
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