EANS-News

RHI AG / Results of the first quarter 2016

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quarterly report

Due to a weaker business development of the Steel and Industrial
Divisions, the RHI Group's revenue, at EUR 389.7 million in the first
quarter of 2016, was lower than revenue of the comparative period of
2015, at EUR 424.1 million, and lower than revenue of the fourth
quarter of 2015, at EUR 440.0 million.

The operating EBIT amounted to EUR 30.3 million in the first quarter
of 2016, after EUR 34.5 million in the comparative period of 2015,
and was thus lower than in the fourth quarter of 2015, at EUR 32.7
million. While the Raw Materials Division increased its operating
EBIT compared with the first quarter of 2015 due to better
utilization of the raw material production capacities, the operating
EBIT of the Steel and Industrial Divisions decreased due to declining
revenues. In comparison with the fourth quarter of 2015 the Steel
Division increased its operating EBIT significantly, among other
things due to a positive development in Europe and North America as a
result of an improved product mix. The decline in the operating EBIT
of the Industrial Division can be explained by the high number of
project deliveries at the end of the year. The operating EBIT margin
of the RHI Group, at 7.8% in the first quarter of 2016, was lower
than in the comparative period of 2015, at 8.1%, but exceeded that of
the fourth quarter of 2015, at 7.4%.

EBIT includes a negative net effect from the power supply contract in
Norway. Here, financial liabilities of roughly EUR 1.9 million were
reversed through profit and loss due to own use and the sale at
market prices; however, due to a decline in electricity future
prices, a negative non-cash effect on earnings of roughly EUR 5.1
million had to be recognized.

Equity amounted to EUR 486.8 million at March 31, 2016, after EUR
491.4 million at December 31, 2015. This development is among other
things due to a reduction of the actuarial interest rate to determine
pension and termination benefit obligations predominantly in Austria
and Germany. Working capital, which consists of inventories, trade
receivables less trade payables and prepayments received, was reduced
from EUR 532.6 million at the end of the year 2015 to EUR 516.4
million at March 31, 2016 due to lower receivables. Free cash flow