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CEMACON SA - CEON

Q3 financial results 2018

Release Date: 11/7/2018 6:00:10 PM

IRIS Code: 78B71

Q3 2018 Performance

 

 

35,13 million lei operational profit (EBITDA)

22,68 million lei Net Profit

92,79 million lei Gross Turnover with 22% greater than Q3 2017

General Manager Statement


We have closed another solid business quarter in which we chose the winning strategy to take advantage of the very positive market context.

We have completed some of our investment projects to increase product quality and complete product offerings, and we have created prerequisites for achieving higher margins in the future, benefiting from immediate positive results.

Operationally, the production activity worked well, and in the market we delivered quantities over the budget forecast.

We are at record levels with the main business indicator over the previous year and above the budget forecast: gross turnover 22% more than in 2017 and net profit 64% higher. We understand, however, that we are at the peak of a growth cycle and that, summing up the predominantly negative prerequisites for budgeering for 2019, such as electricity and gas price increases, the forecast for next year is more reserved.

The competitiveness of the production processes, the positive impact of recent investments, product innovation and production prescriptions, as well as the excellent partnership built with our distributors, together with the solid financial situation and the significant accumulated liquidity represent the premise of success in approaching the years to come, indifferent to contextually market."

 Profit and loss Account – 3rd Quarter 2018

 

In a good market context, can be observed both a consolidation for the net turnover, that exceeds 87,000,000 lei, registering an increase of 20% compared to the same period of 2017, and an important growth in Operating Profit EBITDA; this performance was obtained through a qualitative sale and through optimizations in operational activities. At the level of other operating revenues there were no significant changes compared to 2017.

The increase recorded for other operating income is marked by the increase in the price of EUA certificates received free of charge. Amounts related to other gains or losses represent the cancellation of provisions made in the previous year and also provisions made during the current period. Changes in inventory revenues recorded positive values due to the gap between the quantities produced and sold during the period.

Expenditure on raw materials and materials has grown by 20% as a result of the 7% increase in the quantity produced compared to the same period of the previous year, productivity marked by investments started at the end of 2017 and put into operation in 2018 as well as by a generalized increase in the purchase price for raw materials, materials and fuel generated by the current economic context.

Wage expenditures recorded a 29% increase over the previous year due to a 19% increase in the number of employees compared to the same period in 2017 as well as due to the legislative changes in the wage field implemented at the end of 2017 with effect from January 1, 2018.

At the level of operating expenses there were no significant changes compared to the previous period from last year.

For the period ended September 30, 2018 CEMACON has an operating profit (EBITDA) of 35,133,884 lei and a net profit of 22,684,772 lei.

 

 

30-Sep-18

30-Sep-17

2018 vs 2017

2018 vs 2017

 

LEI

LEI

LEI

%

         

Net Turnover

            87,483,654

      72,828,890

        14,654,764

20%

Gross Turnover

            92,792,329

      76,278,791

        16,513,538

22%

         

Sales revenues

            87,482,092

      72,828,268

        14,653,824

20%

         

Other operating revenues

                 956,383

           544,041

             412,342

76%

Other gains and losses

              1,766,992

        2,830,903

        (1,063,911)

-38%

Change in inventories of FG & WiP

              2,335,087

      (2,318,701)

          4,653,789

-201%

         

Raw material and consumables used

           (17,015,710)

    (14,167,815)

        (2,847,895)

20%

Personnel Expenses

           (16,155,524)

    (12,551,239)

        (3,604,285)

29%

Other operating expenses

           (25,070,711)

    (25,155,917)

               85,206

0%

         

EBITDA

            35,133,884

      23,174,526

        11,959,358

52%

Depreciation and amortisation expenses

             (5,857,513)

      (5,187,363)

           (670,150)

13%

         

EBIT

            29,276,371

      17,987,163

        11,289,208

63%

Financial income

                 190,848

             92,478

               98,369

106%

Financial expenses

             (2,605,572)

      (1,914,820)

           (690,753)

36%

Financial result

             (2,414,725)

      (1,822,342)

           (592,383)

33%

         

Profit before tax

            26,026,372

      14,999,833

        11,026,540

74%

Income tax expenses

             (3,341,600)

      (1,130,901)

        (2,210,699)

100%

Profit after tax

            22,684,772

      13,868,932

          8,815,841

64%

*At the time of presentation of the results for the 3rd Quarter of 2018, no other comprehensive income and deferred tax items have been computed.

** EBITDA = Operating profit + Expenses with depreciation + Financial discounts granted - Income impairment of non-current assets

 

Statement of financial position – results for 30th of September 2018

 

ASSETS

30-Sept-18

31-Dec-17

2018 vs 2017

2018 vs 2017

NON-CURRENT ASSETS

LEI

LEI

LEI

%

Property, plant and equipment

          130,027,164

      121,601,156

         8,426,009

7%

Intangible

              1,058,045

             418,124

            639,921

153%

Investments

                        200

                    200

                      -  

0%

Other non-current assets

              1,049,312

          1,039,555

                9,758

1%

NON-CURRENT ASSETS TOTAL

          132,134,722

      123,059,035

         9,075,687

7%

CURRENT ASSETS

       

Inventories

            10,657,425

        10,798,030

          (140,605)

-1%

Trade and other receivables

            15,988,435

        11,739,027

         4,249,408

36%

Cash and cash equivalents

            40,207,022

        34,498,549

         5,708,473

17%

CURRENT ASSETS TOTAL

            66,852,882

        57,035,606

         9,817,275

17%

Assets classified as held for sale

              1,277,495

          1,277,495

                     -  

0%

TOTAL ASSETS

          200,265,098

      181,372,136

       18,892,962

10%

         

LIABILITIES

       

CURRENT LIABILITIES

       

Trade and other payables

            13,342,394

        13,026,584

            315,810

2%

Loans and borrowings

              7,178,875

          6,724,373

            454,502

7%

Tax liability

              1,382,762

             106,946

         1,275,816

1193%

Provisions

              2,638,325

          4,412,809

       (1,774,484)

-40%

CURRENT LIABILITIES TOTAL

            24,542,356

        24,270,712

            271,644

1%

         

NON-CURRENT LIABILITIES

       

Non-current trade and other liabilities

                           -  

                       -  

                      -  

0%

Loans and borrowings

            39,446,401

        44,254,596

       (4,808,195)

-11%

Grants received

              1,026,464

          1,083,195

            (56,731)

-5%

Deferred tax

              1,539,770

          1,539,770

                      -  

0%

Provisions

                 989,756

             945,520

              44,236

0%

NON-CURRENT LIABILITIES TOTAL

            43,002,391

        47,823,081

       (4,820,690)

-10%

         

TOTAL LIABILITIES

            67,544,747

        72,093,793

       (4,549,046)

-6%

         

NET ASSETS

          132,720,351

      109,278,343

       23,442,008

21%

         

EQUITY

       

Issued capital

            57,067,443

        20,613,371

       36,454,072

177%

TOTAL EQUITY

          132,720,351

      109,278,343

       23,442,009

21%

The 7% increase in fixed assets as of December 31, 2017 is determined by the commissioning of the assets acquired during the period and partially compensated by the depreciation recorded during the period and the reclassification of some non-productive assets as being held for sale.

Current assets increased with 17% compared to the end of 2017. Inventories variation compared with December 31, 2017 is not significant, as it can be seen below:

Receivables increased by 36% as a result of the business activity carried out during the period (24% higher than in the same period of the previous year); Cash and cash equivalents increased by 17% as a result of intense business activity during the period.

Commercial debts increased by 2% as of December 31, 2017.

Bank debts and loans recorded a 9% decrease as compared to the end of 2017, a change caused both by contracting financial leasing for the implementation of the approved investment programs for 2017-2018 and by the reduction of the bank loan by repayment of principal and interest rates according to the repayment schedule, being no interruptions or delays in this process.

Current corporate income tax liabilities increased significantly due to positive financial results at the end of the 3rd Quarter of 2018.

The share capital recorded changes in the 3rd Quarter of 2018, as 364,540,717 new shares were issued, the company reaching 478,530,935 shares. The increase from the equity level is also generated by the result obtained during the period.

For the period ended 30 September 2018, the net assets of the company recorded a 21% increase as compared to the end of 2017, exceeding 132,000,000 lei.

 

Main Financial Ratios

 

Main financial ratios

30-Sept-18

30-Sept-17

1. Current liquidity indicator

              2.78

              2.70

2. Leverage indicator   

35%

52%

3. Turnover speed for client debit items (days)

43

55

4. Turnover speed for total assets

66%

62%


Consolidated Results of the CEMACON Group

 

Information on the presentation of the CEMACON SA Group:

CEMACON SA is a Romanian legal entity founded as a joint stock company based on Government Decision no.1200/1991 with its registered office in Cluj-Napoca, no. 48 Dorobantilor Street, Silver Business Center building, 1st floor, Cluj county. The company’s main object of activity is “Manufacture of bricks, tiles and other construction products made from burnt clay”

SC CEMACON Real Estate Company was founded as a result of the agreement signed by SC CEMACON SA and the Romanian Commercial Bank in order to take over part of the liabilities and assets, according to the reorganization process.The individual financial statements of SC CEMACON Real Estate Company are prepared in accordance with Order of the Minister of Public Finance 1802/2012.

The financial statements of the controlled branch have been prepared for the same reporting period as those of the parent company, using the same accounting policies.The International Financial Reporting Standards (IFRS) have been applied when preparing the consolidated financial statements.

Even if the financial statements of SC CEMACON Real Estate have been prepared in accordance with Order of the Minister of Public Finance 1802/2012, the necessary adjustments have been made in order to reflect the accounting policies of the parent company with a view to consolidating.

Consolidated Statement of financial position – Results 30th of September 2018

 

ASSETS

30-Sept-18

31-Dec-17

2018 vs 2017

2018 vs 2017

NON-CURRENT ASSETS

LEI

LEI

LEI

%

Property, plant and equipment

            130,027,164

   121,601,156

8,426,008       

7%

Intangible

                 1,058,045

           418,124

           639,921

153%

Investments

                                -  

                       -  

                       -  

0%

Other non-current assets

                 1,049,312

       1,039,555

                9,757

1%

NON-CURRENT ASSETS TOTAL

            132,134,521

   123,058,835

       9,075,686

7%

CURRENT ASSETS

       

Inventories

               10,657,425

     10,798,030

         (140,605)

-1%

Trade and other receivables

              14,713,193

     10,664,137

       4,049,056

38%

Cash and cash equivalents

              40,213,669

     34,526,889

         5,686,780

16%

CURRENT ASSETS TOTAL

              65,584,288

     55,989,056

       9,595,232

17%

Assets classified as held for sale

        17,922,162

    19,238,703

        (1,316,541)

-7%

TOTAL ASSETS

            215,640,970

   198,286,594

     17,354,376

9%

         

 

 

 

 

 

LIABILITIES

30-Sept-18

31-Dec-17

2018 vs 2017

2018 vs 2017

CURRENT LIABILITIES

LEI

LEI

LEI

%

Trade and other payables

              14,666,723

             14,203,788

       462,935

3%

Loans and borrowings

                 7,178,875

       6,724,373

         454,502

7%

Tax liability

                 1,382,762

           106,946

       1,275,816

1193%

Provisions

                 2,638,325

       4,412,808

     (1,774,483)

-40%

CURRENT LIABILITIES TOTAL

              25,866,685

             25,447,915

           418,770

2%

         

NON-CURRENT LIABILITIES

       

Non-current trade and other liabilities

                                -  

                       -  

                       -  

0%

Loans and borrowings

              55,322,593

     61,473,144

     (6,150,551)

-10%

Grants received

                 1,026,464

       1,083,195

           (56,731)

-5%

Deferred tax

                 1,312,250

       1,312,250

                        0

100%

Provisions

                    989,756

           945,520

             44,236

0%

NON-CURRENT LIABILITIES TOTAL

              58,651,064

     64,814,109

     (6,163,045)

-10%

         

TOTAL LIABILITIES

              84,517,749

             90,262,024

     (5,744,275)

-6%

         

NET ASSETS

            131,123,221

           108,024,569

     23,098,652

21%

         

EQUITY

       

Issued capital

          57,067,443

     20,613,371

36,454,072                     

177%

TOTAL EQUITY

            131,123,221

           108,024,569

     23,098,652

21%

 


Consolidated Profit and Loss Account – Results for 3rd Quarter of 2018

 

 

 

30-Sep-18

30-Sep-17

2018 vs 2017

2018 vs 2017

 

LEI

LEI

LEI

%

         

Sales revenues

       87,482,092

      72,833,446

   14,648,646

20%

         

Other operating revenues

             976,097

            605,951

         370,146

61%

Other gains and losses

          1,805,399

        2,855,859

   (1,050,460)

-37%

Change in inventories of FG & WiP

          2,335,087

      (2,318,702)

     4,653,789

-201%

         

Raw material and consumables used

     (17,015,742)

    (14,173,339)

   (2,842,403)

20%

Personnel Expenses

     (16,267,795)

    (12,631,538)

   (3,636,257)

29%

Other operating expenses

     (25,088,047)

    (25,200,570)

         112,523

0%

         

EBITDA

       35,062,367

      23,136,093

   11,926,274

52%

Depreciation and amortisation expenses

       (5,857,513)

      (5,187,363)

       (670,150)

13%

         

EBIT

       29,204,854

      17,948,730

   11,256,124

63%

Financial income

             579,705

            369,029

         210,676

57%

Financial expenses

       (3,249,109)

      (2,653,814)

       (595,295)

22%

Financial result

       (2,669,403)

      (2,284,785)

       (384,618)

17%

         

Profit before tax

       25,700,176

      14,498,959

   11,201,217

77%

Income tax expenses

       (3,358,761)

      (1,130,901)

   (2,227,860)

0%

Profit after tax

       22,341,415

      13,368,058

     8,973,357

67%

*At the time of presentation of the results for the 3rd Quarter of 2018, no other comprehensive income and deferred tax items have been computed.

** EBITDA = Operating profit + Expenses with depreciation + Financial discounts granted - Income impairment of non-current assets

 

***

The report, together with the related documents, can be consulted starting with 7 November 2018 at 9:00 at the company headquarters on Str.Dorobantilor, Nr.48, Cluj-Napoca or electronically on the company's website: www.cemacon.ro and on the Bucharest Stock Exchange website: www.bvb.ro

 The results presented are prepared in accordance with IFRS and have a preliminary nature, and will be subject to financial auditing in accordance with legal provisions.

CEMACON SA ranks second in the top of masonry manufacturers in Romania and is the market leader in Transylvania.

The company operates the most modern and largest manufacturing capacity in Romania with innovative, differentiated products that bring added value to users, at very competitive production costs.

CEMACON SA is a company listed on the Bucharest Stock Exchange and mainly owned by institutional shareholders, Romanian and foreign investment funds; the company management is professional, independent, having strong sector expertise.

 



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