Klöckner & Co earnings rise significantly in third quarter of 2020 – share of sales via digital channels grows further

• Operating income (EBITDA) before material special effects €40 million (Q3 2019: €26 million), at upper end of the raised €30 million to €40 million guidance range
• Share of Group sales generated via digital channels further increased to 42% (Q3 2019: 30%), already exceeding the full-year target
• Full-year expectation for EBITDA before material special effects in a range of €75 million to €95 million, with significantly positive cash flow from operating activities

Duisburg, Germany, November 3, 2020 – Klöckner & Co generated operating income (EBITDA) of €40 million before material special effects in the third quarter of 2020 (Q3 2019: €26 million), at the upper end of the already raised guidance range. At €5 million, the net loss improved from €23 million in the prior-year period. This resulted in a loss per share of €0.05 (Q3 2019: loss of €0.23). These positive developments were largely driven by the digitalization and restructuring measures accelerated by the Surtsey transformation program, alongside favorable price effects.

Gisbert Rühl, CEO of Klöckner & Co SE: “We successfully navigated the first wave of the pandemic and we are well prepared for the second thanks to our digital transformation and the Surtsey project.”

As a result of exceptionally strict net working capital management, net working capital was well below the prior-year level of €1.4 billion, amounting to €1.1 billion as of September 30. Net financial debt declined accordingly, down by about one-third to a comparatively low €427 million (September 30, 2019: €634 million).

The share of sales generated via digital channels further increased to 42% (Q3 2019: 30%), meaning that Klöckner & Co has already exceeded the year-end target of 40%. This accelerated growth was bolstered in particular by the Kloeckner Assistant, an AI-based application that almost fully automates the sales process. The open industry platform XOM Materials has also expanded. Its aggregate gross merchandise value in the year to date already amounts to €64 million. The new eProcurement solution to automate the procurement process for XOM customers significantly contributed to this rise.

Given the increase in the rate of COVID-19 transmission, the development of shipments in the final months of 2020 remains uncertain. Due to seasonal effects, Klöckner & Co expects shipments and sales in the fourth quarter of 2020 to be lower than in the prior quarter. Nevertheless, the Company anticipates EBITDA before material special effects of €75 million to €95 million thanks to its well-advanced digitalization and the consistent implementation of the Surtsey transformation project. Klöckner & Co also expects to see a significantly positive cash flow from operating activities.