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Wienerberger generated growth in Q1 2017

First-quarter development confirms expectations at the beginning of the year

Results Q1 2017
Results Q1 2017
Overview 1-3/2017
  • Strong set of first-quarter results
  • Increase in revenues by 8% to € 659.6 million (2016: € 610.8 million)
  • EBITDA up by 15% to € 46.1 million (2016: € 40.1 million)
  • Operating performance confirms strategic focus on value-creating projects, operational excellence and innovation
 
Business review of the Divisions:
  • Clay Building Materials Europe: expectations confirmed – slight upward trend in European residential construction
  • Pipes & Pavers Europe: sound growth in Nordic markets; activities in Eastern Europe gaining momentum; weak demand in international plastic pipes project business
  • North America: satisfactory development of US brick business and activities in Canada
 
Outlook 2017
  • On course to reach organic growth target
 
Vienna, May 10, 2017 – During the first quarter of 2017, Wienerberger succeeded in increasing its revenues at Group level by a satisfactory 8% to € 660 million. Between January and March, EBITDA rose significantly by 15% to € 46 million. The developments seen in the individual business segments confirmed the company’s expectations at the beginning of the year.
 

Strategy validated by strong organic growth

Commenting the results, Heimo Scheuch, Chairman of the Managing Board of Wienerberger AG, says,
“We generated a strong organic growth in the first quarter, despite a slow start into the year due to weather conditions. This shows once again that we are strategically well-positioned for value-creation. We benefit from the positioning of our innovative products and system solutions in the market as well as from intensified marketing and sales activities. The consistent focus on the optimization of our structures and processes, as well as the targeted expansion of our presence in individual fields of business, also contribute to the positive development of the company. Thus, the Wienerberger Group as a whole is flexible and well equipped to operate successfully in an environment of economic and political volatility.”

Business review of the Divisions

Satisfactory revenue and earnings growth in Clay Building Materials Europe Division
In the first quarter, residential construction showed a slight upward trend, in both Western and Eastern Europe. While construction activities were slowed down in January and February by unfavorable weather conditions, business picked up significantly in March. Overall, Wienerberger recorded a notable increase of sales volumes in its Clay Building Materials Europe Division. Prices were nearly stable during the reporting period. Against this background, the Division generated revenues of € 372 million, corresponding to a 9% increase over the first quarter of 2016. The segment’s EBITDA rose significantly compared to the same period of 2016, growing from € 30 million to € 41 million.
 
Pipes & Pavers Europe reports positive development of revenues and drop in EBITDA
The infrastructure market was characterized by highly diverging developments in the first three months of 2017. A slight recovery of markets in Eastern Europe and the sound development of our Nordic core markets had a positive impact on the development of the pipe business. However, this was not enough to compensate for weak demand in the international project business with long-length-large-diameter and fiber-reinforced plastic pipes and the absence of exports of ceramic pipes to the Middle East. Sales of concrete pavers declined slightly for seasonal reasons, but improved cost structures led to a higher operating result. Between January and March revenues of the Pipes & Pavers Europe Division increased by 4% to € 211 million and EBITDA declined to € 7 million.
 
North America Division generates significantly improved result
Wienerberger’s brick business in the USA benefited from more favorable weather conditions than in the previous year. This resulted in livelier activities in the single- and two-family home segment. The positive development of demand also continued in Canada. The US plastic pipe business recovered and improved results. Overall, the North America Division generated revenues of € 74 million, which corresponds to an 18% increase compared to the first quarter of the previous year. During the same period, earnings rose significantly by 68% to € 4 million.
 

Outlook for market trends in 2017 largely unchanged

Wienerberger maintains its projections of a continued, slight increase in residential construction. Positive market developments are expected in almost all countries of Eastern Europe and regionally diverging market trends are foreseen in Western Europe. In the renovation segment, the current trend toward spending restraint should prevail throughout the year. In the infrastructure sector, sound growth is being estimated for the markets of Western and Northern Europe. Markets in Eastern Europe are likely to recover from their current low level. Cushioning the effect of rising raw material prices for plastic granulates will be an important issue in the plastic pipe segment. As regards residential construction in the USA, Wienerberger expects to see continued growth. For Canada, a stable development is predicted year on year.
 
Ambitious earnings target for 2017 confirmed
In conclusion, Heimo Scheuch underlines,
“Our target for this year is to achieve an organic 9% increase in EBITDA. This is an ambitious goal, especially in view of the volatility of our markets and forthcoming events in the political arena, which will continue to influence economic developments in Europe. Wienerberger is well equipped to address the challenges of such an environment. Building on the satisfactory result of the first three months, we will continue to advance the forward-looking development of the Wienerberger Group and strengthen our position as the innovation and technology leader in our industry. Our focus here is on new products and services as well as on digital marketing channels and direct interaction with our customers.”
 
The Wienerberger Group
Wienerberger is the world’s largest producer of bricks (Porotherm, Terca) and the market leader in clay roof tiles (Koramic, Tondach) in Europe as well as concrete pavers (Semmelrock) in Central and Eastern Europe. In pipe systems (Steinzeug-Keramo ceramic pipes and Pipelife plastic pipes), the company is one of the leading suppliers in Europe. With its total of 198 production sites, the Wienerberger Group generated revenues of € 2,974 million and EBITDA of € 404 million in 2016.
 

For further information, please contact:

Karin Steinbichler, Head of Corporate Communications Wienerberger
T +43 1 601 92 - 10149 | communication@wienerberger.com

Klaus Ofner, Head of Investor Relations Wienerberger AG
T +43 1 601 92 - 10221 | investor@wienerberger.com

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