EQS-News: Klöckner & Co consistently implements Group strategy in challenging environment

• Operating income (EBITDA) of €131 million before material special effects (H1 2022: €423 million)
• Positive cash flow from operating activities of €96 million considerably above prior-year period (H1 2022: €1 million)
• Progress in strategy implementation with successful completion of the acquisition of National Material of Mexico and introduction of Nexigen^® Data Services
• EBITDA of €220 million to €280 million before material special effects and significantly positive cash flow from operating activities expected for full year 2023*

Duisburg, Germany, August 2, 2023 – Klöckner  Co generated sales of €4.0 billion in the first half of 2023 (H1 2022: €5.0 billion). Operating income (EBITDA) before material special effects in the first six months of fiscal year 2023 amounted to €131 million (H1 2022: €423 million). In the second quarter of 2023, despite ongoing macroeconomic challenges and a sharp steel price correction, Klöckner  Co generated EBITDA of €63 million before material special effects (Q2 2022: €222 million), which is within the guidance range. Net income amounted to €4 million in the first six months of the current fiscal year (H1 2022: €323 million). Basic earnings per share consequently came to €0.04 (H1 2022: €3.18).

In the first half of 2023, through proactive net working capital management, Klöckner  Co generated a significantly positive cash flow from operating activities of €96 million, thus exceeding the figure for the prior-year period (H1 2022: €1 million). Net working capital decreased relative to June 30, 2022, from €2.2 billion to €1.7 billion. Free cash flow amounted to €63 million in the first six months of the year, compared to a free cash flow of €20 million in the first half of 2022.

Guido Kerkhoff, CEO of Klöckner  Co SE: “Despite a challenging environment, we have successfully advanced the implementation of our Group strategy. With the completion of the acquisition of National Material of Mexico, we have significantly expanded our product and service portfolio and paved the way for sustainable growth in the North American market. At the same time, we continue to work hard to decarbonize the steel industry. The launch of the Nexigen^® Data Services technology solution for instance is an important milestone, providing our customers with smart and digital management of their product emissions.”

Major progress in implementation of the “Klöckner Co 2025: Leveraging Strengths” Group strategy

On August 1, 2023, Klöckner  Co successfully completed the acquisition of National Material of Mexico through its US subsidiary Kloeckner Metals Corporation. The acquisition significantly expands Klöckner  Co’s business in North America and strengthens its position with ten additional sites throughout Mexico, where the most important automotive and industrial customers are located. In the future, the combined company will also serve the exclusive market for electrical steel. This product is an important component of electric car engines and transformers with correspondingly high growth potential.

Klöckner  Co is also making great progress in the establishment of sustainable business models and the decarbonization of the steel industry. Partnerships with the Salzgitter Group and the GMH Group secure large future supply quantities of CO₂-reduced steel. This will enable Klöckner  Co to significantly increase the availability of green steel for its customers. The quantities are sold under umbrella of the Nexigen^® brand which bundles transparent, CO₂-reduced solutions in the area of materials, operations and logistics, for which Klöckner Co has developed its own categorizations for CO₂-reduced products.

Following the introduction of the Nexigen^® PCF Algorithm, which can be used to determine the Product Carbon Footprint (PCF) for almost all of the Company’s approximately 200,000 products, Klöckner  Co took another decisive step in the second quarter of 2023: Nexigen^® Data Services is a technology solution that allows customers to view their emissions history for products purchased from Klöckner  Co. The tool also suggests greener product alternatives and shows the associated reduction potential. In this way, Klöckner  Co supports its customers in building sustainable supply chains and in achieving their decarbonization goals.

Outlook*

Klöckner Co expects demand to recover sequentially as the year progresses and is now forecasting a slight increase in Group shipments for the full year. Due to the significant steel price correction during the second quarter and the resulting overall lower average price level compared with the same period of the prior-year, the Company continues to forecast a significant decline in sales for the fiscal year 2023. Despite the challenging macroeconomic environment, Klöckner Co expects EBITDA in the range of €40 million to €80 million before material special effects in the third quarter of 2023 and €220 million to €280 million for the year as a whole. In addition, Klöckner  Co continues to anticipate a strong and significantly positive cash flow from operating activities in fiscal year 2023, although below the previous year’s level.

*) The forecast has been prepared assuming the closing of the acquisition of National Material of Mexico on August 1, 2023.

About Klöckner  Co:

Klöckner  Co is one of the largest producer-independent distributors of steel and metal products and one of the leading steel service companies worldwide. Based on its distribution and service network of around 160 sites in 13 countries, Klöckner  Co supplies more than 90,000 customers. Currently, the Group has around 7,700 employees. Klöckner  Co generated sales of some €9.4 billion in fiscal year 2022. With the expansion of its portfolio of carbon-reduced materials, services and logistics options under the new Nexigen^® umbrella brand, the company is underscoring its role as a pioneer of a sustainable steel industry. At the same time, Klöckner  Co leads the way in the steel industry’s digital transformation and has set itself the target of digitalizing and largely automating its supply and service chain. In this way, the Company aims to develop into the leading one-stop shop for steel, other materials, equipment and processing services in Europe and the Americas.

The shares of Klöckner  Co SE are admitted to trading on the regulated market segment (Regulierter Markt) of the Frankfurt Stock Exchange (Frankfurter Wertpapierbörse) with further post-admission obligations (Prime Standard). Klöckner  Co shares are listed in the SDAX^® index of Deutsche Börse.

ISIN: DE000KC01000; WKN: KC0100; Common Code: 025808576.

Contact Klöckner  Co SE:

Press
Christian Pokropp – Press Spokesperson
Head of Corporate Communications | Head of Group HR
+49 203 307 2050
[email protected]

Investors
Felix Schmitz
Head of Investor Relations | Head of Strategic Sustainability
+49 203 307-2295
[email protected]