Semperit marginally lowers earnings outlook as 'challenging environment' continues

Vienna – Semperit AG Holding has marginally lowered its earnings forecast for 2021 as the business environment remains challenging with continued raw materials woes. 

In a 17 Nov statement, Semperit said it expected EBITDA (earnings) to be significantly above the previous year’s levels, but to fall short of the earlier estimate of €395 million by ‘a single-digit percentage’.

Semperit announced in March that it expected full year earnings to reach €395 million, depending particularly on "the timely availability of raw materials and their price development, the sales prices for medical protective gloves, and sufficient logistics availability for the delivery of goods."

In its latest financial report, the group said the risk factors communicated in the first quarter had “progressively materialised” and “continue to exist”, prompting the revision in outlook.

Over the first nine months of the year, Semperit ‘defied increasingly challenging market environment’, posting record earnings at €324 million, up 174% compared to the same period last year.

Overall sales rose 41% year-on-year to €926 million, reflecting a 79% increase in medical sales to €517 million and an 11% rise in industrial sales to €409 million. 

Breaking down the figures, the industrial sector, which includes the hose production unit Semperflex, seals business Semperseal, conveyor belts segment Sempertrans and profiles manufacturer Semperform, reported a 1.2% decline in earnings to €64.5 million during the nine-month period.

In particular, Semperflx and Semperseal segments posted strong growth in sales, helped by demand for hydraulic and industrial hoses, as well as economic recovery of the European markets. 

In contrast, production and sales volumes were down in the Sempermed medical gloves business, due to Covid-related movement restrictions in Malaysia in July and to limited availability of containers. 

Nevertheless, "significantly higher sales prices" attributable to the ongoing coronavirus pandemic and the increase in demand boosted segment revenue and raised earnings by more than 310% to €277 million.

"We are posting excellent revenue and earnings figures for the first nine months and are on track to achieve an all-time record result for the full year 2021," said chief financial officer Petra Preining.

“Encouragingly, we are seeing a strong recovery in the order book, particularly in our industrial sector, which is our main focus of attention, and look set to exceed pre-crisis 2019 levels,” said chief operating officer Kristian Brok. 

In contrast, the official said the specific effects on glove prices in the medical business “have clearly passed the plateau”, and the group is increasingly faced with falling average prices since the second quarter.