Statement of the results for the nine months of 2019

Financial information

Ebitda improvement in the third quarter of 2019

The gross operating result («ebitda») obtained by Ercros in the third quarter of 2019 was EUR 16.75 million, 11.7% higher than in the same period of the previous year, and slightly higher than ebitda of the second quarter of 2019 (+1.7%). Even despite the fact that, for seasonal reasons (inclusion of the summer vacation period), the third quarters tend to have a lower ebitda than the second ones.

Behind this improvement in ebitda we have, on the one hand, the increase in sales volume and, on the other, the largest contribution due to the sharp fall in the price of the main procurements and supplies (EDC, electricity and methanol) compared to a more moderate fall in the price of final products (caustic soda, PVC and polyols).

Regarding to the overall first nine months of the year, ebitda –amounting to EUR 46.46 million– has been 24.1% lower than that achieved in the same period of 2018.

The first nine months sales amounted to EUR 503.68 million and exceed by 2.6% of those achieved in the same period last year. The reason for this increase is the greater volume of products sold after the productive capacity expansions and occurs despite the decrease in the sale price of the main products. The currency effect has also contributed to increasing the billing amount.

In the reference period, procurements have increased by 5.9% and supplies by 6.6%. The increase in both items is not due to prices, since, as noted above, the price of raw materials and electricity has continued falling, but at the higher level of production.

Despite the reduction in the workforce, personnel expenses increase by 6.5% due to the greater reversal of restructuring provisions made in 2018; while the other operating expenses increased by 11.7%, mainly due to the higher logistic expenses derived from the greater volume of products shipped.

From the rest of income statement items, it is worth noting the financial result, which is reduced by 16.5% despite the higher debt, due to the its lower financial cost and the positive balance of exchange differences; and the income tax, which increases by EUR 4.84 million. Thus, the result of the period was EUR 17.31 million compared to EUR 36.12 million in the first nine months of the previous year.

Regarding to the balance sheet, between December 31, 2018 and September 30, 2019, non-current assets have increased due to investments made, while working capital has decreased mainly due to the reduction in inventories. Net financial debt has grown by EUR 12.62 million, reaching EUR 139.16 million mainly due to the payment of provisions and other debts, which in turn have been reduced by EUR 11.83 million.

Ercros expects the ebitda of 2019 fourth quarter to be better than that achieved in the fourth quarter of last year, a fact that will reduce the annual fall compared to 2018.


Income statements for the 2019 and 2018 first nine months

Ercros guarantees that the relevant facts contained on this page correspond exactly to those sent by the Company to the CNMV, and disseminated by it to the market. The facts prior to those included in this section are available on the CNMV website.

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