Form 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Report of Foreign Issuer
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934
For the month of: May 2005
SGL CARBON Aktiengesellschaft
(Name of registrant)
Rheingaustrasse 182
65203 Wiesbaden
Germany
(Address of Principal Executive Offices)
Indicate by check mark whether the registrant files or will file annual reports
under cover of Form 20-F or Form 40-F:
Form 20-F__X__ Form 40-F
Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the SEC
pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934:
Yes____ No__X__
If "Yes" is marked, indicate the file number assigned to the registrant in
connection with Rule 12g3-2(b): N/A
Exhibit Index
-------------
Second Quarter Press Releases
1. April 28, 2005 German Press Release - SGL Carbon's Ratings Upgraded by
Moody's
2. May 2, 2005 German Press Release - SGL Carbon Divests IT Operations to
Thales
3. May 4, 2005 German Press Release - Report on the First Quarter of 2005
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
SGL CARBON Aktiengesellschaft
Date: May 25, 2005 By: /s/ Robert J. Kohler
-------------------------------
Name: Robert J. Koehler
Title: Chairman of the Board of
Management
By: /s/ Sten Daugaard
-------------------------------
Name: Mr. Sten Daugaard
Title: Member of the Board of
Management
SGL Carbon's Ratings Upgraded by Moody's
o Corporate Bond Rating Raised from Caa1 to B3
Wiesbaden, April 28, 2005. Yesterday evening, SGL Carbon received a total of
five upgrades from the rating agency Moody's Investors Service, covering ratings
for the Company, credit facilities, and the corporate bond. The improved
assessment from Caa1 to B3 of the corporate bond issued in February 2004 is an
especially important indicator for the financial market. The upgrading replaces
the previous so-called "junk bond" status with the more favorable
"non-investment" status. The upgrade will have a favorable impact on potential
future financial arrangements undertaken by SGL Carbon.
Moody's placed SGL Carbon on its watch list for a possible upgrade following the
sale of the Surface Protection business in January of this year. The upgrade
then followed the analysis of the annual financial statements that were
disclosed early in March. Moody's justifies the higher company, credit
facilities, and corporate bond ratings based in particular on the substantial
increase in profit from operations and the improvements in the financial figures
over the past 12 months, as well as the Company's healthy business outlook and
the high level of capacity utilization of the core business Carbon and Graphite,
the sale of the loss-generating Surface Protection business, and the launch of
the administrative cost-reduction program.
Forward-looking statements:
This document contains statements on future developments that are based on
currently available information and that involve risks and uncertainties that
could lead to actual results deviating from these forward-looking statements.
These risks and uncertainties include, for example, unforeseeable changes in
political, economic and business conditions, particularly in the area of
electrosteel production, the competitive situation, interest rate and currency
developments, technological developments and other risks and unanticipated
circumstances. We see other risks in price developments, unexpected developments
relating to acquired and consolidated companies, ongoing restructuring measures
and unforeseeable occurrences in conjunction with the reviews to be performed by
the European antitrust authorities. SGL Carbon does not intend to update these
forward-looking statements.
Your contact:
-------------
Corporate Communications / Press Office / Stefan Wortmann
Tel. : +49 611 60 29 105 / Fax : +49 6 11 60 29 101 / Mobil : +49 170 540 2667
e-mail : stefan.wortmann@sglcarbon.de / Internet : www.sglcarbon.de
SGL CARBON AG
Corporate Communications, Media Relations
Rheingaustrasse 182, D-65203 Wiesbaden
Tel.: +49 (6 11) 60 29-100, Fax: +49 (6 11) 60 29-101
E-Mail: cpc@sglcarbon.de, Internet: www.sglcarbon.de
SGL Carbon Divests IT Operations to Thales
o Key Component of Worldwide Administrative Cost-Cutting Program implemented
o Over (euro) 10 Million Reduction in IT Expenses over Next Five Years
Wiesbaden, May 2, 2005. Within the framework of its administrative cost-cutting
program, which SGL Carbon announced in November, 2004, the Company recently
divested its major IT operations to Thales Information Systems GmbH in Siegburg.
The two parties agreed not to disclose the purchase price. SGL Carbon will save
(euro) 10 million in IT costs over the next five years due to this sale plus
additional outsourcing measures.
As a result of this sale, all the human resource capacities that had been built
up and allocated for the Company's IT harmonization have been adjusted to meet
customary IT business requirements once again. The IT staff that is now required
are remaining with the Company; where they have already been integrated within
the reorganized IT unit. The new organization resulted in a IT headcount
reduction of nearly 15 employees. In addition to all the SAP development
activity that is being outsourced as a result of the sale, Thales will also
provide specialized IT infrastructure services for SGL Carbon within the
framework of an outsourcing agreement.
At an expense of nearly (euro) 20 million, in 2002/2003 SGL Carbon replaced its
historically inherited, 15 different IT systems with a uniform SAP platform. The
uniform IT environment now in place throughout the Company makes it possible to
realize both short-term and medium-term synergies in worldwide administrative
processes. This is causing a continual reduction in the number of jobs required
for administrative functions. A total of 50 job positions were eliminated in
2004, with a further reduction by nearly 90 in 2005 and the remainder to follow
in 2006. The focus of attention of the worldwide administrative cost-cutting
program, which was introduced in November 2004, is on IT, on accounting, and on
human resource administration. Beginning in 2006, the Company intends to
generate annually savings of approximately (euro) 11 million through the
streamlining of processes and the elimination of nearly 150 job positions. The
restructuring outlays necessary for the overall cost-reduction program total
between (euro) 5 and (euro) 6 million. Of this amount, (euro) 3.5 million was
already dispersed in 2004.
Forward-looking statements:
This document contains statements on future developments that are based on
currently available information and that involve risks and uncertainties that
could lead to actual results deviating from these forward-looking statements.
These risks and uncertainties include, for example, unforeseeable changes in
political, economic and business conditions, particularly in the area of
electrosteel production, the competitive situation, interest rate and currency
developments, technological developments and other risks and unanticipated
circumstances. We see other risks in price developments, unexpected developments
relating to acquired and consolidated companies, ongoing restructuring measures
and unforeseeable occurrences in conjunction with the reviews to be performed by
the European antitrust authorities. SGL Carbon does not intend to update these
forward-looking statements.
Your contact:
-------------
Corporate Communications / Press Office / Stefan Wortmann
Tel. : +49 611 60 29 105 / Fax : +49 6 11 60 29 101 / Mobil : +49 170 540 2667
e-mail : stefan.wortmann@sglcarbon.de / Internet : www.sglcarbon.de
SGL CARBON AG
Corporate Communications, Media Relations
Rheingaustrasse 182, D-65203 Wiesbaden
Tel.: +49 (6 11) 60 29-100, Fax: +49 (6 11) 60 29-101
E-Mail: cpc@sglcarbon.de, Internet: www.sglcarbon.de
Q1
Report on the First Quarter of 2005
Prepared in accordance with International Financial Reporting Standards, IFRSs
(unaudited)
The report on the first quarter of 2005 was prepared in accordance with the
International Financial Reporting Standards (IFRSs) (unaudited). The same
accounting policies were used in this report as in the annual financial
statements for 2004.
o Increase in sales of 13% compared with Q1/2004
o Above average improvement in EBIT with positive after-tax result
o Further improvement in earnings anticipated for Q2/2005
o Rating upgrade from Moody's
Financial Highlights (unaudited)
--------------------------------------------------------------------------------
First Quarter First Quarter
--------------------------------------------------------------------------------
((euro) million) 2005 2004
--------------------------------------------------------------------------------
Sales revenue 238.3 211.0
--------------------------------------------------------------------------------
Gross profit 64.3 59.4
--------------------------------------------------------------------------------
EBITDA 35.0 31.1
--------------------------------------------------------------------------------
EBIT 20.9 16.7
--------------------------------------------------------------------------------
Return on sales(1) 8.8 % 7.9 %
--------------------------------------------------------------------------------
Net profit (loss) from continuing operations 3.7 0.6
--------------------------------------------------------------------------------
Net profit (loss) from discontinued operations - - 4.0
--------------------------------------------------------------------------------
Net profit (loss) before minority interests 3.7 - 3.4
--------------------------------------------------------------------------------
Earnings per share (in (euro)) 0.07 - 0.08
--------------------------------------------------------------------------------
Operational cash flow continuing operations(2) 11.4 3.8
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
March 31, December 31,
--------------------------------------------------------------------------------
((euro) million) 2005 2004
--------------------------------------------------------------------------------
Total assets 1,257 1,315
--------------------------------------------------------------------------------
Equity 290 282
--------------------------------------------------------------------------------
Net debt(3) 342 321
--------------------------------------------------------------------------------
Debt ratio (gearing)(4) 1.2 1.1
--------------------------------------------------------------------------------
Equity ratio(5) 23.1 % 21.4 %
--------------------------------------------------------------------------------
(1) EBIT divided by sales revenue
(2) Without currency exchange rate effects
March 31, Dec. 31,
2005 2004
(3) Financial debt (incl. convertible bonds) 418.4 416.4
+ Refinancing costs 19.5 20.3
- Restricted cash for convertible bonds - 50.3 - 50.8
- Unrestricted cash and cash equivalents - 45.3 - 64.7
Net debt excluding restricted cash for antitrust 342.3 321.2
(4) Net debt divided by shareholders' equity
(5) Shareholders' equity divided by total assets
SGL Carbon
Effective January 6, 2005, SGL Carbon concluded the sale of its investment in
SGL ACOTEC GmbH, which included SGL's Surface Protection business. The effects
resulting from this transaction were already recognized in the annual financial
statements for 2004. The Process Technology (PT) business remaining in the Group
was integrated within the Graphite Specialties (GS) Business Area. Only the
results of continuing operations are presented in this quarterly report.
According to IFRS 2, since January 1, 2005, share-based payments, such as stock
option plans and share bonus programs, for employees and members of senior
management are included under staff costs. Based on a current calculation, this
change will burden the results of the segments and corporate costs by a total of
approximately (euro)2 million each quarter in 2005.
As we already discussed at the year-end press conference in March, the
restructuring measures have now largely been completed. Therefore, profit from
operations (EBIT) no longer includes a separate presentation of restructuring
expenses.
Business development in the Group
In particular as a result of the continuing strong demand for graphite
electrodes, consolidated sales increased by 13% to (euro)238.3 million (Q1/2004:
(euro)211.0 million); after adjusting for foreign currency changes, an increase
of 15% was posted. EBIT increased on a comparable basis by 25% from (euro)16.7
million in the previous year to (euro)20.9 million in Q1/2005 - largely the
result of the ongoing favorable business development of CG and the reduced
operating loss of SGL T. Adjusted EBIT for Q1/2004 of (euro)16.7 million is
calculated as follows: EBIT after restructuring expenses amounted to (euro)7.7
million in Q1/2004. Taking into consideration the (euro)6.5 million operating
loss from the divested Surface Protection business, the cessation of the
(euro)1.3 million scheduled amortization of goodwill in line with IFRS 3, and
the reclassification of the North American pension provisions of (euro)1.2
million, that are now unified and shown in the financial result altogether in
the above-mentioned EBIT of (euro)16.7 million. The USD currency risk in
financial year 2005 has been largely hedged.
On April 27, 2005, the rating agency Moody's announced an upgrade of their
rating for both the Company and for the corporate bond. The rating of SGL Carbon
was accordingly upgraded from B2 to B1 and the bond from Caa1 to B3 - overall an
improvement by one full ranking. Moody's sees the main causes for the upgrade in
the Company's operating and financial performance over the last twelve months,
the outlook for CG's business, the Company's level of visibility for 2005, the
already completed disposal of the Surface Protection business, and the launch of
the restructuring program for administrative functions in 2004. Moody's stable
outlook assumes that the company's cash flow generation and de-leveraging will
continue.
Net financing costs
The net financing costs improved from (euro)-15.2 million in Q1/2004 to
(euro)-13.1 million in Q1/2005. The quarterly net interest expense on loans
decreased from (euro)7.7 million in Q1/2004 to (euro)7.0 million in Q1/2005.
This is attributable to the lower volume of borrowing and the higher interest
income. In addition, non-cash expenses in connection with the antitrust
proceedings (interest expense and exchange rate effects) decreased by (euro)0.9
million to (euro)2.0 million.
Result before and after taxes
Profit before tax totaled (euro)7.8 million in Q1/2005 compared with (euro)1.5
million in Q1/2004. With a tax rate of approximately 50%, the Group earned a net
profit of (euro)3.7 million (Q1/2004: (euro)0.6 million). The high tax rate
results mainly from the inability to offset profits in some countries from
losses in other countries. For the remaining year the tax rate should level off
by around 40-50%. Taking into consideration the loss of the Surface Protection
business, the net profit after taxes increased by approximately (euro)7.1
million from (euro)-3.4 million in Q1/2004 to (euro)3.7 million in Q1/2005. The
resulting earnings per share was (euro)0.07 compared with (euro)-0.08 in the
same quarter of the previous year.
Financial position
Largely through the sale of the Surface Protection business, as of March 31,
2005, total assets decreased by (euro)64 million to (euro)1,257 million.
According to plan, a further payment of (euro)7.4 million was made to the U.S.
antitrust authorities from the restricted cash account for antitrust payments.
Even though the equity of (euro)290 million remained almost unchanged at the end
of March 2005, compared with (euro)282 million at the end of December 2004, the
equity ratio improved from 21% to 23%. On a proforma basis, the figure is 24%
after deducting the convertible bond of (euro)50 million, which is due in
September 2005, from the balance sheet total.
After deducting cash and the restricted cash account for the repayment of the
convertible bond, net financial debt increased by (euro)21 million from
(euro)321 million as of December 31, 2004 to (euro)342 million. The increase in
working capital by (euro)28 million over fiscal year-end 2004 mainly results
from CG's strong order backlog ((euro)369 million at the end of March 2005,
compared with (euro)341 million at the end of December 2004; working capital
amounted to (euro)375 million at the end of March 2004). Gearing was 1.2
(Q1/2004: 1.1).
Financial condition
During the first three months of 2005, SGL Carbon generated a positive
operational cash flow of (euro)11.4 million, compared with (euro)3.8 million
during the same period of the previous year. This quarter-to-quarter increase is
attributable to the improvement in EBIT as well as the lower level of additions
to working capital. Other cash uses from operating activities, which include
interest payments due to the semiannual payment date for the corporate bond,
increased from (euro)-12.8 million in Q1/2004 to (euro)-21.4 million. Net cash
used before antitrust payments thus amounted to (euro)-10.0 million, compared
with (euro)-9.0 million in the same period the previous year. The payments in
connection with antitrust proceedings comprise scheduled payments to the U.S.
antitrust authorities of (euro)7.4 million, which were made from the
corresponding restricted cash account. Capital expenditure in property, plant
and equipment during the reporting period were (euro)7.0 million (Q1/2004:
(euro)6.2 million) - approximately (euro)7 million less than depreciation, which
totaled (euro)14 million in Q1/2005 - unchanged from Q1/2004.
Business development of the segments
Carbon and Graphite [CG]
--------------------------------------------------------------------------------
First Quarter First Quarter
--------------------------------------------------------------------------------
((euro) million) 2005 2004
--------------------------------------------------------------------------------
Sales revenue 142.9 122.6
--------------------------------------------------------------------------------
EBITDA 34.4 25.3
--------------------------------------------------------------------------------
Profit from operations (EBIT) 26.7 17.9
--------------------------------------------------------------------------------
Return on sales 18.7 % 14.6 %
--------------------------------------------------------------------------------
Sales increased by 16% from (euro)122.6 million in Q1/2004 to (euro)142.9
million in Q1/2005. Growth was 19% after adjusting for foreign currency changes.
Due to the ongoing favorable demand for graphite electrodes, further price
increases, and ongoing cost reduction measures, EBIT for Q1/2005 amounted to
(euro)26.7 million - 49% higher than the (euro)17.9 million posted in Q1/2004.
The return on sales improved from 14.6% in Q1/2004 to 18.7% in Q1/2005. The
average price for graphite electrodes increased over Q1/2004 by 11% in USD terms
and by 4% in euro terms. Approximately 52,000 metric tons were delivered in
Q1/2005 - nearly 16% more than the 45,000 metric tons delivered in Q1/2004. In
line with our forecasts, raw material and energy costs rose by approximately 10%
over 2004.
Graphite Specialties [GS]
--------------------------------------------------------------------------------
First Quarter First Quarter
--------------------------------------------------------------------------------
((euro) million) 2005 2004
--------------------------------------------------------------------------------
Sales revenue 57.3 58.1
--------------------------------------------------------------------------------
EBITDA 4.5 9.0
--------------------------------------------------------------------------------
Profit from operations (EBIT) 1.3 5.3
--------------------------------------------------------------------------------
Return on sales 2.3 % 9.1 %
--------------------------------------------------------------------------------
Sales of (euro)57.3 million were 1% less than the (euro)58.1 million posted in
the same quarter the previous year. This development was influenced in
particular by PT, which was included as part of GS for the first time. The PT
business reported lower project related sales in Q1/2005, which were down by 15%
to approximately (euro)10 million. This development is expected to be recouped
already in Q2/2005. Excluding PT, the sales of GS improved by around 3% to
(euro) 47.5 million. EBIT is (euro)1.3 million in Q1/2005 compared with a figure
of (euro)5.3 million in Q1/2004. The Q1/2005 figure included a loss generated by
the PT business of (euro)-1.5 million (Q1/2004: (euro)0.4 million). The business
of GS alone, which totaled (euro)2.8 million, declined by approximately (euro)2
million in Q1/2005 compared with the (euro)4.9 million realized in Q1/2004 - a
result of the higher level of output as well as the inventory buildup in Q1/2004
due to the delivery structure of the orders realized in fiscal year 2004.
Compared with 2004, no comparable inventory buildup was necessary this year due
to an expected strong H2/2005.
SGL Technologies [T]
--------------------------------------------------------------------------------
First Quarter First Quarter
--------------------------------------------------------------------------------
((euro) million) 2005 2004
--------------------------------------------------------------------------------
Sales revenue 37.5 29.8
--------------------------------------------------------------------------------
EBITDA 2.7 1.4
--------------------------------------------------------------------------------
Profit from operations (EBIT) - 0.6 - 1.8
--------------------------------------------------------------------------------
Return on sales - 1.6 % - 6.0 %
--------------------------------------------------------------------------------
Sales grew by 26% from (euro)29.8 million in Q1/2004 to (euro)37.5 million. The
favorable sales volume in composites, carbon-ceramic brake discs, and especially
in fibers were in part offset by the EUR/USD exchange rate. Sales adjusted for
foreign currency changes rose by approximately 30%. EBIT in Q1/2005 amounted to
(euro)-0.6 million (Q1/2004: (euro)-1.8 million). With the exception of the
carbon-ceramic brake disc business, which was subject to additional development
costs in connection with the possible launch of series production, all lines of
business contributed to this favorable development.
Corporate Costs
--------------------------------------------------------------------------------
First Quarter First Quarter
--------------------------------------------------------------------------------
((euro) million) 2005 2004
--------------------------------------------------------------------------------
Other revenue 0.6 0.5
--------------------------------------------------------------------------------
Corporate costs - 6.5 - 4.7
--------------------------------------------------------------------------------
Corporate costs rose from (euro)-4.7 million in Q1/2004 to (euro)-6.5 million in
Q1/2005. This is primarily attributable to the measurement of share-based
payments for the first time in line with IFRS 2 beginning on January 1, 2005,
which were not expensed in Q1/2004. Furthermore, a bonus was paid in Q1/2005,
which did not occur the previous year, when the members of the Board of
Management and executive management declined to receive bonuses.
Employees
Due to the restructuring, the number of employees in the Group fell by 18 from
5,109 as of December 31, 2004 to 5,091 at the end of Q1/2005.
The SGL Carbon share
The closing price of the SGL Carbon share on March 31, 2005 was (euro)9.86 -
2.3% higher than the 2004 year-end price of (euro)9.63 (all quotations XETRA). A
total of 56.46 million shares were outstanding at the end of March 2005. In
February 2005, in accordance with section 25 (1) of the German Securities
Trading Law (Wertpapierhandelsgesetz), BT Pension Scheme Limited in the U.K.
announced that it holds a 5.110% stake in SGL Carbon. The members of the Board
of Management and management acquired a total of 192,095 shares of the Company
within the framework of personal investments and current stock option programs.
Of this amount 114,099 shares were acquired by members of the Board of
Management and by management on a voluntary basis with their own means.
Outlook
In Q2/2005, SGL Carbon anticipates a growth in sales of around 10% and an
improvement in EBIT of approximately 40% compared with Q1/2005. Due to the
favorable demand situation, additional increases in sales and higher average
revenues for graphite electrodes have been forecast for the CG segment. Due to
additional sales increases, a significant improvement in EBIT is expected for GS
and in particular for PT in connection with project-related business. The
favorable trend is also expected to continue in SGL T, especially through the
further increase in fiber capacity utilization as well as the gratifying order
backlog in aerospace and defense projects. For the year as a whole, SGL Carbon
anticipates nearly unchanged an increase in sales of more than 5 percent, an
above average rise in EBIT, and a positive after-tax result on a consolidated
basis. Net financial debt is to be further reduced.
Consolidated Income Statement (unaudited)
--------------------------------------------------------------------------------
First Quarter First Quarter
--------------------------------------------------------------------------------
((euro) million) 2005 2004
--------------------------------------------------------------------------------
Sales revenue 238.3 211.0
--------------------------------------------------------------------------------
Gross profit 64.3 59.4
--------------------------------------------------------------------------------
Selling, administrative, research and other costs - 43.4 - 42.7
--------------------------------------------------------------------------------
Profit from operations (EBIT) 20.9 16.7
--------------------------------------------------------------------------------
Net financing costs - 13.1 - 15.2
--------------------------------------------------------------------------------
Profit (loss) before tax 7.8 1.5
--------------------------------------------------------------------------------
Income taxes - 4.1 - 0.9
--------------------------------------------------------------------------------
Net profit (loss) continuing operations 3.7 0.6
--------------------------------------------------------------------------------
Net profit (loss) discontinued operations - - 4.0
--------------------------------------------------------------------------------
Net profit (loss) for the period 3.7 - 3.4
--------------------------------------------------------------------------------
Earnings per share (in (euro); diluted = basic) 0.07 - 0.08
--------------------------------------------------------------------------------
Details of financing costs
--------------------------------------------------------------------------------
First Quarter First Quarter
--------------------------------------------------------------------------------
((euro) million) 2005 2004
--------------------------------------------------------------------------------
Interest expense on loans (net) - 7.0 - 7.7
--------------------------------------------------------------------------------
Interest expense on pensions - 3.1 - 3.3
--------------------------------------------------------------------------------
Interest expense on antitrust (non-cash) - 1.3 - 1.7
--------------------------------------------------------------------------------
Total interest expense, net - 11.4 - 12.7
--------------------------------------------------------------------------------
Currency and hedging valuation adjustments of
antitrust liabilities (non-cash) - 0.7 - 1.2
--------------------------------------------------------------------------------
Amortization of refinancing costs - 1.0 - 0.7
--------------------------------------------------------------------------------
Other 0.0 - 0.6
--------------------------------------------------------------------------------
Total other financing expenses - 1.7 - 2.5
--------------------------------------------------------------------------------
Net financing costs - 13.1 - 15.2
--------------------------------------------------------------------------------
Treatment of the interest rates from pension provisions was already standardized
for the entire Group in the annual financial statements for 2004. Although this
measure improves the EBIT of the segments, it results in higher charges to net
financing costs. Furthermore, in line with the accounting provisions that were
applied in the annual financial statements for 2004 (IFRS 3: Business
Combinations), which were early adapted, goodwill is no longer subject to
scheduled amortization. In line with this standard, goodwill with an infinite
useful life is no longer amortized according to plan. This measure also
influences EBIT of the various segments. We have restated the quarterly results
for 2004 for reasons of comparability in order to take the above-mentioned
factors into consideration.
Consolidated Balance Sheet (unaudited)
--------------------------------------------------------------------------------
March 31, December 31,
--------------------------------------------------------------------------------
((euro) million) 2005 2004
--------------------------------------------------------------------------------
Assets
--------------------------------------------------------------------------------
Intangible assets 87 85
--------------------------------------------------------------------------------
Property, plant and equipment 343 345
--------------------------------------------------------------------------------
Long-term investments 30 30
--------------------------------------------------------------------------------
Deferred tax assets 134 130
--------------------------------------------------------------------------------
Non-current assets 594 590
--------------------------------------------------------------------------------
Inventories 258 248
--------------------------------------------------------------------------------
Trade receivables 202 184
--------------------------------------------------------------------------------
Other current assets 38 36
--------------------------------------------------------------------------------
Cash and cash equivalents 45 65
--------------------------------------------------------------------------------
Restricted Cash for repayment of convertible bond 50 51
--------------------------------------------------------------------------------
Restricted Cash for antitrust 70 77
--------------------------------------------------------------------------------
Assets held for sale - 64
--------------------------------------------------------------------------------
Current assets 663 725
--------------------------------------------------------------------------------
Total assets 1,257 1,315
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
March 31, December 31,
--------------------------------------------------------------------------------
((euro) million) 2005 2004
--------------------------------------------------------------------------------
Equity and liabilities
--------------------------------------------------------------------------------
Equity including minority interest 290 282
--------------------------------------------------------------------------------
Financial liabilities 357 353
--------------------------------------------------------------------------------
Provisions for pensions and other employee benefits 157 156
--------------------------------------------------------------------------------
Deferred tax liabilities 45 45
--------------------------------------------------------------------------------
Other liabilities 29 37
--------------------------------------------------------------------------------
Other provisions 21 19
--------------------------------------------------------------------------------
Non-current liabilities 609 610
--------------------------------------------------------------------------------
Financial liabilities(1) 62 63
--------------------------------------------------------------------------------
Trade payables 91 91
--------------------------------------------------------------------------------
Other liabilities 86 79
--------------------------------------------------------------------------------
Other provisions 119 126
--------------------------------------------------------------------------------
Liabilities held for sale - 64
--------------------------------------------------------------------------------
Current liabilities 358 423
--------------------------------------------------------------------------------
Total equity and liabilities 1,257 1,315
--------------------------------------------------------------------------------
(1) including convertible bonds of (euro)50 million as of March 31, 2005
In accordance with IAS 1, the balance sheet items were apportioned as long- or
short-term assets and liabilities. Assets and liabilities are broken down by
maturity into short-term (up to one year) and long-term (over one year) items.
All the provisions for the European antitrust fines are included under other
provisions, which are short-term in nature, due to the uncertainty existing
regarding subsequent legal judgments.
Statement of Changes in Consolidated Equity (unaudited)
--------------------------------------------------------------------------------
First Quarter First Quarter
--------------------------------------------------------------------------------
((euro) million) 2005 2004
--------------------------------------------------------------------------------
Balance at January 1 282 117
--------------------------------------------------------------------------------
Capital increase 2 254
--------------------------------------------------------------------------------
Net profit (loss) from continuing operations 4 1
--------------------------------------------------------------------------------
Net profit (loss) from discontinued operations - - 4
--------------------------------------------------------------------------------
Currency exchange differences and other 2 - 1
--------------------------------------------------------------------------------
Balance at March 31 290 367
--------------------------------------------------------------------------------
Consolidated Cash Flow Statement(1) (unaudited)
--------------------------------------------------------------------------------
First Quarter First Quarter
--------------------------------------------------------------------------------
((euro) million) 2005 2004
--------------------------------------------------------------------------------
Profit from operations (EBIT) 20.9 16.7
--------------------------------------------------------------------------------
Depreciation 14.1 14.4
--------------------------------------------------------------------------------
EBITDA 35.0 31.1
--------------------------------------------------------------------------------
Decrease (increase) in working capital - 23.6 - 27.3
--------------------------------------------------------------------------------
Operational cash flow 11.4 3.8
--------------------------------------------------------------------------------
Other operating cash sources (uses) - 21.4 - 12.8
--------------------------------------------------------------------------------
Cash provided (used) by operating activities
before antitrust payments - 10.0 - 9.0
--------------------------------------------------------------------------------
Payments relating to antitrust proceedings - 7.4 - 0.1
--------------------------------------------------------------------------------
Cash provided (used) by operating activities - 17.4 - 9.1
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Capital expenditures - 7.0 - 6.2
--------------------------------------------------------------------------------
Other investing activities 0.0 0.9
--------------------------------------------------------------------------------
Cash used in investing activities - 7.0 - 5.3
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Net change in financial liabilities - 3.2 54.6
--------------------------------------------------------------------------------
Payments in connection with refinancing 0.0 - 18.4
--------------------------------------------------------------------------------
Net proceeds from capital increase 0.0 245.9
--------------------------------------------------------------------------------
Cash provided (used) by refinancing activities - 3.2 282.1
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Cash used in discontinued operations - - 1.8
--------------------------------------------------------------------------------
Effect of foreign exchange rate changes 0.5 0.2
--------------------------------------------------------------------------------
Net increase (decrease) in cash and cash equivalents - 27.1 266.1
--------------------------------------------------------------------------------
Cash and cash equivalents at beginning of the year 192.7 46.1
--------------------------------------------------------------------------------
Cash and cash equivalents at end of quarter 165.6 312.2
--------------------------------------------------------------------------------
(1) Without currency exchange rate effects
Quarterly Sales Revenue & Profit from Operations (EBIT) by Segments (unaudited)
--------------------------------------------------------------------------------
2004 2005
--------------------------------------------------------------------------------
Full
(euro) million Q1 Q2 Q3 Q4 Year Q1
--------------------------------------------------------------------------------
Sales revenue
--------------------------------------------------------------------------------
Carbon and Graphite 122.6 149.5 140.5 142.9 555.5 142.9
--------------------------------------------------------------------------------
Graphite Specialties 58.1 57.2 60.8 59.7 235.8 57.3
--------------------------------------------------------------------------------
SGL Technologies 29.8 34.7 33.4 35.3 133.2 37.5
--------------------------------------------------------------------------------
Other 0.5 0.6 0.3 0.3 1.7 0.6
--------------------------------------------------------------------------------
211.0 242.0 235.0 238.2 926.2 238.3
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
2004 2005
--------------------------------------------------------------------------------
Full
(euro) million Q1 Q2 Q3 Q4 Year Q1
--------------------------------------------------------------------------------
Profit (loss) from operations (EBIT)
--------------------------------------------------------------------------------
Carbon and Graphite 17.9 27.5 25.5 18.8 89.7 26.7
--------------------------------------------------------------------------------
Graphite Specialties 5.3 4.9 4.2 0.8 15.2 1.3
--------------------------------------------------------------------------------
SGL Technologies - 1.8 - 2.1 - 2.1 - 4.1 - 10.1 - 0.6
--------------------------------------------------------------------------------
Corporate - 4.7 - 5.2 - 9.0 - 10.4 - 29.3 - 6.5
--------------------------------------------------------------------------------
16.7 25.1 18.6 5.1 65.5 20.9
--------------------------------------------------------------------------------
Quarterly Consolidated Income Statement (unaudited)
--------------------------------------------------------------------------------
2004 2005
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Full
(euro) million Q1 Q2 Q3 Q4 Year Q1
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Sales revenue 211.0 242.0 235.0 238.2 926.2 238.3
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Cost of sales - 151.5 - 168.9 - 168.2 - 174.8 - 663.4 - 174.0
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Gross profit 59.5 73.1 66.8 63.4 262.8 64.3
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Selling/administrative/R&D/other - 42.8 - 48.0 - 48.2 - 58.3 - 197.3 - 43.4
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Profit (loss) from operations
(EBIT) 16.7 25.1 18.6 5.1 65.5 20.9
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Net financing costs - 15.2 - 16.2 - 14.0 - 15.1 - 60.5 - 13.1
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Profit (loss) before tax 1.5 8.9 4.6 - 10.0 5.0 7.8
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Income taxes - 0.9 - 2.5 - 4.1 6.3 - 1.2 - 4.1
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Net profit (loss) continuing
operations 0.6 6.4 0.5 - 3.7 3.8 3.7
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Net profit (loss) discontinued
operations - 4.0 - 2.7 - 2.0 - 76.8 - 85.5 -
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Net profit (loss) for the period - 3.4 3.7 - 1.5 - 80.5 - 81.7 3.7
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Important note:
This document contains statements on future developments that are based on
currently available information and that involve risks and uncertainties that
could lead to actual results deviating from these forward-looking statements.
These risks and uncertainties include, for example, unforeseeable changes in
political, economic and business conditions, particularly in the area of
electrosteel production, the competitive situation, interest rate and currency
developments, technological developments and other risks and unanticipated
circumstances. We see other risks in price developments, unexpected developments
relating to acquired and consolidated companies, ongoing restructuring measures
and unforeseeable occurrences in conjunction with the reviews to be performed by
the European antitrust authorities. SGL Carbon does not intend to update these
forward-looking statements.