Press Release: HELM Group – 2014 Results
2014 results: HELM Group achieves exceptionally good earnings
Hamburg- May 20, 2015
The HELM Group delivers the second-best result in its entire 114-year corporate history, further advancing investments and participations in the process. Last year the Group invested over 250 million euros in total in securing and extending the Company’s existing fields of business. Last year HELM succeeded in further boosting the key figures of the Group. The strengths of the independent marketing organisation operating on an international scale once again came to the fore with the Company’s focus on chemicals, fertilizer, crop protection and pharmaceuticals, comprehensive marketing services, international networks and regional market expertise.
“We fully achieved our objective in 2014 and are highly satisfied with our earnings. The Company’s result was boosted in spite of a lack of economic impetus in Europe, despite the substantial oil price decline in the second half of the year and notwithstanding the ongoing geopolitical crises. That’s a reflection of the performance delivered by all employees of the HELM Group worldwide,” said Hans-Christian Sievers, CEO of HELM AG.
It was possible for global pre-consolidation revenues to be maintained despite the price decline in the second half of the year at a level of EUR 9.76 billion (previous year: EUR 9.67 billion).
External revenues were likewise maintained at EUR 5.05 billion (previous year: EUR 5.02 billion).
EBITDA was up by EUR 65.6 million in 2014, to reach EUR 186.1 million, which corresponds to an increase of approx. 55%.
Consolidated net income for the period reflects an increase of approx. 72% and, at a level of EUR 141.6 million, 2014 is the second-best year in the Group’s history (previous year: EUR 82.2 million).
The main reasons for this positive development on the product side are very good earnings in Chemicals, an improved and good fertilizer business as a whole, a compellingly strong earnings position of HELM subsidiaries and an outstanding profit situation in the field of production participations.
The main sales market of the HELM Group in 2014 was Europe with a share of 64%, followed by the Americas with a share of 23% and Asia with a share of 12%.
In 2014 HELM consistently continued its corporate strategy, namely growth in Asia as well as investments in strategically important regions and companies.
Offices were opened in Norway and China, amongst other locations. In addition, HELM took over the Spanish chemicals distributor GEBLASA S.A. in order to reinforce HELM’s position in the Mediterranean Sea region.
The consistent policy of retaining earnings to underpin equity is being continued. This gives the HELM Group a particular level of stability and independence. Equity is up by EUR 134 million, to EUR 758 million (previous year: EUR 624 million). With an equity ratio of 48.8% (previous year: 44.4%), the Group has a very good balance sheet structure. Fixed assets amount to EUR 326.5 million, compared with EUR 758 million in equity.
Hans-Christian Sievers: “The year 2014 was an important year for HELM: a total of over 250 million euros was invested last year in securing and extending HELM’s existing fields of business in order to make the Company fit for the future. What is visible in Hamburg is the conversion work carried out on our main building. These projects have now been practically concluded – only the conversion of the Company's canteen is still outstanding.”
Consolidated results: performance figures
|in EUR million||2014||2013||2012|
|Earnings before taxes||170.8||109.7||197.4|
|Consolidated net income||141.6||82.2||160.2|
Performance of the individual business units – overview
Chemicals: Feedstocks and Derivatives
The business segment Chemicals, consisting of the two business units Feedstocks and Derivatives, recorded a gratifying result in 2014. Together, the business units achieved an increase in revenues of 6.5%. This increase was possible in spite of unforeseeable challenges in the chemicals market, such as the rapid oil price decline, plant production standstills and geopolitical tensions.
The business segment Chemicals contributes the lion’s share of revenues in the HELM Group, namely 63%.
Revenues generated by the business unit Fertilizer were down by 15%, essentially due to price factors. The volumes traded were equivalent to those of the preceding year. The market was highly volatile throughout the year on account of declining grain prices, crisis-related export declines, production stoppages as well as excess nitrogen capacities.
The financial year was highly encouraging in France, where it was possible to substantially extend the Company’s leading position relating to imports of UAN, a solution of urea and ammonium nitrate in water used as a fertilizer. Business trends were just as positive in the US.
The business unit invested in new storage locations and thus is extending the direct marketing business: In England, HELM is now represented in Howdendyke, Mistley and Bristol und has a blending facility of its own in Howdendyke. A new storage location was also established in Huelva, Spain.
The business unit Fertilizer accounts for the second-largest share of revenues within the HELM Group.
The crop protection business underwent solid development in 2014. Owing to humid weather conditions in Europe, sales of fungicides increased significantly. Moreover, the focus was on successful registrations and approvals of new products in Latin America and Europe. The business unit Crop Protection also plans to make investments in developing active ingredients.
Business results improved significantly in relation to the budgetary parameters laid down; this was also supported by the positive contribution by the business field of medical auxiliary products. They have still not returned to the solid level of previous years, however. The business unit Pharma was subjected to a comprehensive strategic analysis process in 2014. The future business model reflects a stronger orientation towards differentiated, patent-free pharmaceutical products such as injectables, transdermal systems and complex, orally administered products.
Efforts to achieve this objective are made by means of strategic partnerships with selected producers and developers, in particular with the participation in Amarin Technologies S.A. in Argentina. In the process the primary focus of project decisions always is on strategy and the customers’ long-term objectives.
For those HELM companies organised within the business unit HELM-International, 2014 once again turned out to be a successful year. Even though the economic situation in southern Europe remains difficult and developments in China did not meet expectation either, it was possible to further advance the extension of strategic core products and to secure long-term supply sources to a substantial degree. The basis of this success story also in the year under review was the excellent networking and collaboration of all HELM companies amongst one another and with the parent company in Hamburg, as well as the distribution business networked on a global scale.
In 2014 the size of the workforce of the international HELM organisation grew slightly. The reason for this was the purchase of the Spanish chemicals distributor GEBLASA, S.A., with 20 employees. On 31 December 2014, HELM had 639 (634) employees in Hamburg, 698 (694) in Germany, and 1,461 (1,431) worldwide, excluding participations.
A low fluctuation rate of 4.7% also in 2014 is an indicator of the immense job satisfaction of HELM’s employees, both male and female.
Thanks to the very good result achieved, a special bonus will be paid out.
Outlook for 2015
Current developments worldwide such as sharp exchange-rate fluctuations in Latin America, a substantial price decline owing to the low oil price, noticeable reluctance to purchase and a price level substantially below that of 2014 exerted an influence on HELM’s business activities in the first quarter.
The level of demand for chemical products stabilised in the second quarter, as did the oil price.
On the whole, 2015 is expected to be a solid year.
HELM perceives an immense opportunity in the ongoing shale gas boom in the US: the market changes arising in the process can favour a successful extension of marketing in the fields of chemicals and fertilizer.
New division created
For selected strategic products, HELM also participates as a capital provider for new projects in the field of chemical plant construction. In order to identify long-term participations and partnerships in a systematic and structured fashion and ultimately implement these successfully, HELM has created the division Strategic Projects.
Strategic focus on Asia
Thanks to the targeted establishment of additional sales offices and subsidiaries in the course of 2015, HELM will further reinforce its activities in the strategic growth areas of Asia. By opening its headquarters in Singapore in May 2015, a milestone was achieved in the Company’s commitment to Asia.
In the course of far-reaching strategy processes in the individual business units as well as a consistent extension and intensive maintenance of marketing processes structured on a long-term basis, HELM has laid the foundations for its future success story and gives the Group a confident and optimistic outlook for the year 2015.
HELM AG is a Hamburg family enterprise steeped in a rich tradition with a corporate history exceeding 114 years. As a multifunctional distribution organisation, HELM handles chemicals (feedstocks and derivatives), crop protection products, active pharmaceutical ingredients and medicinal products as well as fertilizer. Today HELM is one of the world’s biggest chemicals marketing companies, providing access to key markets through specific regional expertise with over 100 subsidiaries, sales offices and participations in more than 30 countries across the globe.