Aurubis Group reports for significant earnings decline in first nine months of fiscal year 2012/13 due to lower metal prices

Hamburg, 27-8-2013 — /EuropaWire/ — The Aurubis Group generated operating earnings before taxes (EBT) of € 133 million in the first nine months of the current fiscal year and was thus not able to follow up on its very good prior-year earnings (€ 247 million). The decrease was primarily due to lower metal prices and the resulting devaluations of precious metal inventories and losses in the fair value assessment of derivatives, which strained third quarter earnings in particular. Individual markets, such as the sulfuric acid market and the copper scrap market, were also weak in some areas. Nevertheless, production and sales of copper and copper products were at a good level overall.

Peter Willbrandt, Chairman of the Aurubis Executive Board, summarized the situation: “The production performance was good across the Group, but market trends varied. While processing fees for copper concentrate and cathode premiums were at a high level, copper product markets and the acid and copper scrap markets were under pressure. Unfortunately, our earnings don’t reflect the company’s performance in the third quarter due to the negative valuation effects.”

The revenues of the Aurubis Group (Aurubis) totaled € 9,631 million (€ 10,235 million last year) after the first nine months of fiscal year 2012/13. The decrease in revenues is mainly a result of lower metal prices. Earnings before taxes based on IFRS amounted to € -286 million (€ 410 million in the previous year).

Operating earnings before taxes, which better reflect the business performance, decreased to € 133 million (€ 247 million last year) and were determined by the following factors:

At 1.71 million t, the throughput of copper concentrates was about 8 % higher than last year (1.58 million t). At the same time, treatment charge revenues were higher. Copper cathode output was 862,000 t, reaching the high prior-year level (859,000 t).

Sulfuric acid output and sales were also 8 % higher due to the higher copper con-centrate throughput. However, selling prices were about one-third lower than the high prior-year level owing to demand.

The decline in the copper price increasingly strained copper scrap availability on the market, with corresponding impacts on refining charges. Although Aurubis had a sufficient supply of copper scrap and other recycling materials, the company faced a roughly 25 % decrease in processing fees compared to last year.

Demand for copper products in Europe was influenced by a weak economic environment and lower demand from the automotive sector. In contrast, demand in North America was high.

Furthermore, metal price decreases in the third quarter led to non-cash devaluations of precious metal inventories and losses in the fair value assessment of derivatives as of the balance sheet date.

An operating consolidated net income of € 103 million (€ 173 million last year) remains after deducting the tax expense. Operating earnings per share amounted to € 2.28 (€ 3.83 last year). Net cash flow was € -2 million (€ 233 million last year) due in large part to the build-up of working capital and declining earnings.

OUTLOOK

Overall, we view the copper market as well supported in the current fiscal year despite economic uncertainties. We expect cathode premiums to stay at a good level accordingly. Copper prices will likely remain volatile at a level of US$ 7,000/t for the time being.

We also expect a high production performance in the last quarter of the current fiscal year, though this will be influenced by the large-scale standstill scheduled for the Hamburg smelter. We expect concentrate treatment charges to remain at a good level. We assume that sulfuric acid revenues will move sideways until the end of the fiscal year. We don’t expect copper scrap refining charges to improve in the short term compared to the past quarter. The profit situation for our copper products will continue to be impacted by weak demand in Europe.

Peter Willbrandt explained: “All in all, I expect the copper markets to be well supported in the next few months with a high production performance, though the large-scale maintenance standstill in Hamburg has to be taken into account. The markets for copper scrap and sulfuric acid probably will not recover in the short term. The product markets have potential to move upwards. Considering the earnings of the first three quarters, we expect earnings for the entire year to be significantly down on the previous year. Nevertheless, we look confidently to the coming fiscal year 2013/14 following the successful conclusion of our maintenance standstill in Hamburg.”

The complete Interim Report on the First Nine Months 2012/13 can be found at www.aurubis.com.

OVERVIEW OF GROUP KEY FIGURES (IFRS)

* Comments on the operating result are presented in the explanatory notes to the results of operations, financial position and net assets; certain prior-year figures have been adjusted

Disclaimer:

Forward-looking statements: This information contains forward-looking statements based on current assumptions and forecasts. Various known and unknown risks, uncertainties and other factors could have the impact that the actual future results, financial situation or developments differ from the estimates given here. We assume no liability to update forward-looking statements.

Company profile

Aurubis is the leading integrated copper group and the world’s largest copper recycler. We produce some 1 million t of copper cathodes each year and from them a variety of copper products.

Aurubis has about 6,400 employees, production sites in Europe and the USA and an extensive service and sales system for copper products in Europe, Asia and North America.

Thanks to our wide range of services, we rank among the global leaders in our industry. Our core business is the production of marketable copper cathodes from copper concentrates, copper scrap and recycling raw materials. These are processed within the Group into continuous cast wire rod, shapes, rolled products and strips as well as specialty wire made of copper and copper alloys. Precious metals and a number of other products, such as sulfuric acid and iron silicate, round off our product portfolio.

Customers of Aurubis include companies in the copper semis industry, the electrical engineering, electronics and chemical industries as well as suppliers of the renewable energies, construction and automotive sectors.

Aurubis is oriented to growth and to increasing corporate value. The main focus of our strategy is on strengthening our business, utilizing growth opportunities and practicing a responsible attitude when dealing with people and handling resources and the environment.

Aurubis shares are part of the Prime Standard Segment of the Deutsche Börse and are listed in the MDAX, the European Stoxx 600 and the Global Challenges Index (GCX).

Further information at www.aurubis.com

CONTACTS:

Michaela Hessling
Executive Director Corporate
Communications
Tel. +49 40 7883-3053
m.hessling(at)aurubis.com

Matthias Trott 
Senior Communications Specialist
Tel. +49 40 7883-3037
m.trott(at)aurubis.com