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2017-11-09 18:00 CET
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RECYLEX SA: FINANCIAL INFORMATION FOR THE NINE MONTHS TO SEPTEMBER 30, 2017

  • Strong sales growth at September 30, 2017, supported by good levels of production in the Lead & Zinc segments and higher metals prices
  • Solid operating performance in the third quarter of 2017, in line with the trends in the first two quarters

Suresnes, November 9, 2017: the Recylex Group (Euronext Paris: FR0000120388 - RX) has today reported its sales for the nine-month period to September 30, 2017 and for the third quarter of 2017.

Nine-month 2017 sales came to €337.5 million, up 27% compared with the first nine months of 2016. Sales during the third quarter of 2017 came to €119.2 million, an increase of 23% on the third quarter of 2016.
The breakdown in consolidated sales in the nine months to September 30, 2017 by business segment was as follows:
 Consolidated sales by segment (unaudited IFRS figures):

(€ million) Nine months to
September 30, 2017
Nine months to
September 30, 2016
Change
(%)
Lead 242.6 189.5 +28%
Zinc 74.3 52.3 +42%
Special Metals 10.4 11.7 -11%
Plastics 10.2 11.5 -11%
Total 337.5 265.0 +27%

Yves Roche, Chairman and Chief Executive Officer of the Recylex Group, commented:
"Our good performance continued throughout the first nine months of 2017, thanks to the strong rise in metals prices and to our solid production levels in the Lead and Zinc segments. The Plastics and Special Metals segments still face tough conditions, but we saw the first positive signs during the third quarter. In the fourth quarter of 2017, we will aim to maintain a high level of production across all our business segments in order to benefit from the supportive environment and we will continue the construction work on the new reduction furnace, which is currently progressing on schedule."


  1. Metal prices in euros and €/$ exchange rates in the nine months to September 30, 2017

The average lead price over the first nine months of 2017 was 27% higher than in the same period of 2016. After a slight correction during the second quarter of 2017, it reverted to its early 2017 level and remained consistently above its level in the first nine months of 2016. As a reminder, lead prices started to recover in the third quarter of 2016.
The average zinc price over the first nine months of 2017 increased by 43% compared to the same period of 2016. Although it experienced a modest correction in the second quarter of 2017, it held up well above its 2016 level. As a reminder, zinc prices suffered a strong decline in the first half of 2016, but then posted a very sharp rise in the second half.
Average prices in the nine months to September 30 were as follows:

(€ per tonne) Nine months to September 30, 2017 Nine months to September 30, 2016 Change (%)
Lead price 2,031 1,595 +27%
Zinc price 2,499 1,751 +43%

Source: London Metal Exchange 2017.
The average €/$ exchange rate remained stable (down 0.2%) over the first nine months of 2017 at 1.1139, just below the 1.1160 recorded in the same period of 2016. It is worth noting the uptrend between January 1, 2017 and September 30, 2017.

  1. Breakdown of consolidated sales to September 30, 2017 relative to September 30, 2016

Consolidated sales in the first nine months of 2017 came to €337.5 million, up 27% compared with the same period of 2016. Restated* nine-month 2017 sales came to €356.4 million, up 28% compared with the same period of 2016.
Third-quarter 2017 consolidated sales totaled €119.2 million, up 23% from €97.2 million in the third quarter of 2016. Restated* third-quarter 2017 sales rose 24% to €126.4 million.

  • Lead: sales up 28%

During the first nine months of 2017, Lead sales accounted for 72% of consolidated sales.

Nine-month 2017 sales came to €242.6 million, up 28% compared with the first nine months of 2016. The main factors contributing to this increase were the strong rise in lead prices and a very good level of production compared with the first nine months of 2016 despite the scheduled maintenance shutdown in the first half of 2017 (no shutdowns occurred in 2016).

Lead production at the Weser-Metall GmbH smelter rose 9% to 90,863 tonnes in the nine-month period to September 30, 2017 from 83,684 tonnes in the first nine months of 2016. Pursuing their selective purchasing policy, the recycling plants of Recylex SA in France and Harz-Metall GmbH in Germany processed more than 99,000 tonnes of scrap batteries over the same period, representing a significant increase compared to the nine-month period to September 30, 2016, as a result of an improved availability of materials for recycling.

In the third quarter of 2017, Lead segment sales came to €91.2 million. This represented a 30% increase on the third quarter of 2016, reflecting higher lead production and prices during the period.
  • Zinc: sales up 42%

Zinc sales accounted for 22% of the consolidated total during the first nine months of 2017.
They totaled €74.3 million in the first nine months of 2017, which represented a strong increase of 42% on the same period of 2016. Restated* nine-month 2017 sales came to €93.2 million, up 44% compared with the same period of 2016.
In spite of the scheduled maintenance shutdown at the Harz-Metall GmbH subsidiary during the first half of 2017 (no shutdowns occurred in 2016), electric arc furnace dust recycling sales were higher than in the first nine months of 2016 as a result of the strong increase in zinc prices and good business levels. The Group's total Waelz oxide production (including 100% of Recytech SA's output) rose 1% to 53,905 tonnes in the first nine months of 2017 from 53,555 tonnes in the equivalent period of 2016.
The scrap zinc recycling business' nine-month 2017 sales were also higher than in the equivalent period of 2016 mainly owing to the rise in zinc prices. Zinc oxide production at the Norzinco GmbH subsidiary in Germany remained stable at 17,837 tonnes in the first nine months of 2017 compared with 17,889 tonnes in the same period of 2016.
In the third quarter of 2017, the segment's sales came to €21.9 million. This represented a 10% increase on the third quarter of 2016 reflecting higher zinc prices during the third quarter of 2017. The segment was temporarily affected by maintenance operations of industrial facilities in both businesses. For the same reasons, the segment's restated* nine-month 2017 sales came to €29.1 million, up 16% compared with the first nine months of 2016.

  • Special Metals: sales down 11%

Special Metals sales contributed 3% of the Group's consolidated nine-month 2017 total.
PPM Pure Metals GmbH reported nine-month 2017 sales of €10.4 million, down 11% on the first nine months of 2016.
This decline was chiefly attributable to lower germanium sales volumes and prices, offset partially by the increase in tolling, and also to weaker gallium sales. However, high-purity arsenic sales improved slightly compared with the first nine months of 2016.
During the third quarter of 2017, the segment's sales came to €3.2 million, down 14% on their level in the third quarter of 2016 as a result of the same factors.

  • Plastics: sales down 11%

Plastics sales accounted for 3% of consolidated sales in the first nine months of 2017.
Nine-month 2017 sales came to €10.2 million, down 11% compared with the first nine months of 2016.
Due to persistently tough conditions, C2P in France and Germany recorded a contraction in sales volumes, but selling prices fell only moderately. In the first nine months of 2017, recycled polypropylene production declined 8% to 9,977 tonnes from 10,880 tonnes in the equivalent period of 2016.
During the third quarter of 2017, the segment's sales came to €2.9 million, down 6% on their level in the third quarter of 2016.

*To assess the performance of the Zinc segment, the Group also releases restated financial data including the contribution from 50%-owned Recytech SA consolidated proportionately, even though this method is not permitted under IFRS. See Note 19 to the 2016 consolidated financial statements.

  1. Other key developments

Following the successive exercises by Kepler Cheuvreux since the beginning of 2017 within the scope of the equity line arranged in December 2016 to cover Recylex SA's cash requirements arising from its ongoing operations in France, 1,240,000 new shares were issued at October 31, 2017, generating a net cash flow of €6,919,780 for Recylex SA. Consequently, a shareholder who held 1% of Recylex SA's share capital at December 31, 2016 would have had its stake decrease to 0.9511%.


Beginning of October 2017, Recylex SA resumed partial rehabilitation work at the L'Estaque site for €1.2 million, financed by its own cash flow. As a reminder, Recylex SA continues its search for dedicated financing to finalize this rehabilitation work and valorization of the site. A total of €10.8 million in provisions were set aside in the financial statements at December 31, 2016 to cover these works.

  1. Ongoing legal proceedings involving Recylex SA and Metaleurop Nord SAS
The October 20, 2017 update summarizing developments in proceedings concerning Recylex SA and Metaleurop Nord SAS is available from the Recylex Group's website (www.recylex.fr - News - Legal proceedings schedule).
  1. Financial agenda

 2017 sales: Thursday, February 15, 2018 (after market close)

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Regenerating the urban mines
With operations in France and Germany, Recylex is a European group specialized in lead, zinc and plastics recycling as well as in the production of special metals. A key player in the circular economy with long-standing expertise in urban waste recovery, the Group has more than 660 employees in Europe and generated consolidated sales of €382 million in 2016.
For more information about Recylex Group: www.recylex.fr and on twitter: @Recylex 
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Press/Investor contact:

Gabriel ZEITLIN
+ 33 (0)1 58 47 29 89
gabriel.zeitlin@recylex.fr




APPENDIX


1.     Quarterly average metals prices

(€ per tonne) First quarter 2017 Second quarter 2017 Third quarter 2017 First quarter 2016 Second quarter 2016 Third quarter 2016
Lead price 2,138 1,963 1,988 1,582 1,522 1,677
Zinc price 2,610 2,358 2,522 1,522 1,699 2,019

Source: London Metal Exchange 2017.

 2.     Consolidated sales by quarter

(€ million) First quarter 2017 Second quarter 2017 Third quarter 2017 First quarter 2016 Second quarter 2016 Third quarter 2016
Lead 86.5 64.9 91.2 68.9 50.2 70.4
Zinc 28.5 23.9 21.9 15.5 16.8 20.0
Special Metals 3.8 3.4 3.2 3.9 4.1 3.7
Plastics 3.8 3.5 2.9 4.2 4.2 3.1
Total 122.6 95.7 119.2 92.5 75.3 97.2

IFRS figures. 2017 data unaudited, 2016 data audited.

3.     Recylex SA's sales

(€ million) Nine months to September 30, 2017 Nine months to September 30, 2016 Change
(%)
Lead segment 66.7 38.7 +72%
Services to Group companies 0.9 0.9 -
Total sales 67.6 39.6 +71%

IFRS figures. 2017 data unaudited, 2016 data audited.

Disclaimer: This press release may contain forward-looking statements that do not constitute forecasts regarding results or any other performance indicator, but rather trends or targets. These statements are by their nature subject to risks and uncertainties as described in the Company's annual report available on its website (www.recylex.fr). Further information about Recylex is available from its website (www.recylex.fr).

HUG#2148575