According to preliminary results, RHI increased consolidated revenues by 8.8% to €1,596.7 million (~ $2,030.9 million) in 2008, up from the 2007 level of €1,467.6 million (~ $1,866.7 million). However, at €148.4 million (~ $188.8 million), the operating result fell short of the prior-year-figure of €165.8 million (~ $210.9 million) due to increased precautionary measures (market risks and impairments) in the balance sheet totaling €39 million (~ $50 million) in the context of the global recession.
RHI Group’s 2008 profit amounted to €100.6 million (~ $128.0 million), compared to €111.0 million (~ $141.2 million) in 2007. The RHI management board will propose to the annual general meeting May 28, 2009, to carry forward the accumulated profit 2008 of RHI AG in its entirety to further strengthen equity and with a view to the economic situation.
The year 2008 showed varied developments for the group: while two-digit growth rates in revenues and earnings were recorded in the first three quarters, the fourth quarter reflected the first effects of the global economic crisis. The Steel Division suffered a 6.5% decline in revenues in the fourth quarter; the Industrial Division resisted this trend with a 7.8% increase in revenues.
In order to be prepared for further growth, the management board of RHI AG has decided to reorganize the group. As of July 1, 2009, the respective production facilities and research activities will be allocated to the Steel, Industrial and Raw Material Divisions. In the third quarter of 2009, RHI will report according to the new structure for the first time. Moreover, a comprehensive cost-cutting program with a savings target of approximately €80.0 million (~ $102 million) has been launched for 2009/2010.
In the first months of the year 2009, the negative trend of the last quarter of 2008 continued. Economic recovery plans worldwide should have a positive impact on RHI’s customer industries in the second half of 2009. Lower raw material and energy prices, as well as internal cost savings, should partially counteract future price pressure.
Additional details are available at www.rhi-ag.com