Denmark: Rockwool International has posted its financial results for the first half of 2015. These show a marginal improvement in performance for the period compared to the same period of 2014.
Its sales came to Euro1.06bn, a 2.3% increase compared to the same period of 2014 with no significant overall effect from exchange rates. However, for the second quarter of 2015, net sales were 1.7% down compared to the second quarter of 2014.
The external sales of Rockwool's Insulation Segment reached Euro798.6m in the first half-year, which is slightly below 2014 but represents an increase of 1.0% based on comparable exchange rates. For the second quarter of 2015 external sales decreased by 1.0% compared to same period of 2014, mostly due to a negative exchange rate effect of 1.2%. Earnings before interest, tax, depreciation and amortisation (EBITDA) for the first half were Euro155.6m.
Sales prices have continued to be stable in most countries where Rockwool operates with the exception of France where sales prices decreased in a number of key segments. Input costs have were also reported to have been 'stable' in the first half of2015, with some positive effect from raw materials stemming from lower energy prices.
First half-year sales in Western Europe increased by 2.0% with only limited effect from exchange rates. The German and, to a lesser extent, the French insulation markets continued to be disappointing whereas most other European countries showed solid signs of recovery. For the second quarter of 2015 Western Europe increased 0.4% against the same period in 2014, with no impact from currencies.
Eastern European insulation sales decreased by 14.6% compared to the first half of 2014 and also decreased by 2.6% based on comparable exchange rates. While sales in Poland continued to perform well, the decrease was primarily due to lower sales in Russia where difficult market conditions continued to prevail. For the second quarter of 2015 sales decreased by 11.3% but by only 1.8% based on comparable rates, thanks to slightly more positive conditions in Russia.
In North America and Asia, the positive development of sales in the first quarter slowed. Sales increased by 21.7% compared to 2014 primarily due to a positive exchange rate effect as the increase at comparable exchange rates was 8.9%. The growth mainly comes from North America while sales in Asia decreased slightly. For the second quarter of 2015 sales increased by 20.7% but only 5.4% based on comparable rates.
Going forward, Rockwool expects that market conditions in Europe will continue to improve gradually in line with the development seen in most of the countries during the first half of 2015. It is also expected that trading conditions in Germany will improve in the coming quarters, even if it is unlikely that the delayed plan for new government incentives to stimulate energy renovation in buildings will be ready to benefit the German insulation market in 2015. Sales prices in Europe are expected to remain around their current level.
The instability in the Russian economy makes it difficult to predict how business conditions will develop, but Rockwool has maintained its forecast of a decline around 15%. It is not expected that sales price increases can offset the high inflation given the competitive situation in the Russian insulation market.
Despite a slower development in the second quarter, Rockwool says that it is still confident that sales in North America will register a double digit increase supported by good market conditions and increased interest in the properties of mineral wool. The green field factory in Mississippi remains on target to reach the end of its scheduled running-in period by end 2015.
