S&T AG: exceeding targets for 2014

01.04.2015 | Austria
  • Revenues from sales reached EUR 385.5 million (PY: EUR 337.9 million)
  • Consolidated income showed a strong y-on-y rise to EUR 14.0 million (PY: EUR 11.9 million)
  • Operating cash flow nearly doubled to EUR 20.6 million (PY: EUR 11.1 million)
  • Proposal to increase dividend to 7 cents
  • High backlog of EUR 157 million (PY: 97 million) sets course for strong growth in 2015

S&T AG (www.snt.at) is setting forth its course of growth. Powered by a strong fourth quarter, S&T's revenues from sales rose more than 14% in financial year 2014, going from EUR 337.9 million (2013) to EUR 385.5 million (2014). S&T thus exceeded the target of EUR 375 million set for the year.

The “Services EE” segment achieved sales of EUR 217.2 million (PY: EUR 199.7 million). In addition to this, it was once more S&T's “technologies segments” that drove corporate growth. The two Appliances segments registered sales of EUR 78.8 million (PY: EUR 41.6 million), of which EUR 28.8 million stemmed from the newly-created “Appliances Smart Energy” one. In 2014, the Services “Germany, Austria and Switzerland” segment (in 2013: “Products”) scaled down its low margin business. Its sales accordingly declined as planned to EUR 89.6 million (PY: EUR 96.7 million), with its gross margin increasing from 19.3% (2013) to 22.3% (2014).

Making this growth even more gratifying is the fact that the company's indicators of earnings developed so positively, notwithstanding the expansion of scope of business and the losses ensuing from the starting up of the “smart energy” sector. Gross margin rose slightly to 33.0% (PY: 32.9%). Costs did not rise as fast as sales. This, in turn, caused EBITDA to increase to EUR 22.9 million (PY: EUR 20.1 million). Consolidated income increased 17% to EUR 14.0 million (PY: EUR 11.9 million). Earnings per share rose to 32 cent (PY: 30 cent). Upon being adjusted for amortization-caused expenditures, the earnings per share come to 37 cent (PY: 36 cent).

Cash flow from operations came to EUR 20.6 million (PY: EUR 11.1 million). The inflows of liquidity enabled the financing of the acquisitions concluded and the reduction of financial liabilities. Thanks to this, the net debt declined substantially to EUR 1.5 million (PY: EUR 9.4 million). These positive developments in liquidity are causing S&T's Management and Supervisory Boards to propose to the general assembly of shareholders the paying out of a dividend of 7 cent per share, a 15% increase over 2013. The dividend is treated as a repayment of capital for Austrian income tax purposes according to Section 4 Subsection 12 of the Austrian Income Tax Act.

The positive development of corporate finances and earnings manifested themselves in the performance of the equity, which rose to, as of 31.12.2014, EUR 89.7 million (PY: EUR 71.2 million).

Management expects revenues to rise 20% to EUR 465 million in 2015. The course of strong growth will be set forth in 2016. These forecasts are based upon the amount of the backlog – EUR 156.7 million as of 31.12.2014 (PY: 97.2 million EUR) – and the project pipeline, which came as of 31.12.2014 to EUR 644.4 million (PY: EUR 308.1 million). The new projects to be implemented by the Smart Energy segment are expected to be a prime source of this growth. Management does not expect this segment's revenues – due to development and start-up costs – to make a significant contribution in 2015. Management does expect the segment to become highly profitable in 2016.

Management's plans foresee the Group's achieving in 2015 consolidated income of at least EUR 15 million, the encumbrances in the smart grid sector notwithstanding. Income will then substantially rise in 2016.The development of business in the first quarter of 2015 has provided initial confirmation of the prediction for the 2015.

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