Negative exchange rate effects pushed consolidated revenue down by 1.2% to CHF 311.4 million (an increase of 4.2% after adjustment for currency effects). Lower raw material and energy costs offset the pressure on the market prices. The EBIT margin increased from 9.5% to 10.3% year-on-year.
Although the economic situation in Europe has stabilised, in Ukraine the effects of the political crisis were clearly noticeable with the sharp fall in the hryvnia of over 40%, cautious consumers and uncertain suppliers and customers. Despite these adverse conditions, in the first half of the year production at Vetropack’s Ukrainian plant ran at full capacity and operating performance was pleasing.
Vetropack Group increased its sales volume by 5.5% to 2.36 billion units of glass packaging (2013: 2.23 billion units). Consolidated gross revenue amounted to CHF 311.4 million (2013: CHF 315.1 million). The fall was due to the exchange rate; after adjusting for currency effects, gross revenue increased by 4.2%.
Consolidated EBIT amounted to CHF 32.2 million (2013: CHF 29.9 million) and the EBIT margin could be increased from 9.5% in the previous year to 10.3%. The persistently strained price situation and the high percentage of beer bottles in the product mix led to reduced sales prices, which could be offset at Group level as raw material and energy costs were also lower. Consolidated semi-annual profit amounted to CHF 28.2 million (2013: CHF 28.5 million).
At CHF 58.6 million, cash flow was up by 9.9% on the same period in the previous year (2013: CHF 53.3 million). The cash flow margin amounted to 18.8% of gross revenue (2013: 16.9%).
Outlook for the second half of 2014
Vetropack is not expecting performance over the next six months to match the same level as in the first half of the financial year. This is primarily due to the cost-intensive installation of a new furnace in the Czech plant, as well as further developments in Ukraine. The threat of energy rationing (gas, electricity), trade and logistical problems in areas annexed by Russia and a decrease in consumption will also affect the local Vetropack plant. What will happen to the hryvnia exchange rate is also unknown.
Consolidated revenue will fail to reach last year’s figures, mainly owing to currency effects, while earnings will also be down year-on-year.
For further information please contact:
Vetropack Holding Ltd
Claude R. Cornaz, CEO
Tel. +41 (0)44/863 32 04
David Zak, CFO
Tel. +41 (0)44/863 32 25