Highlights Interim financial report Q1-Q3 2018

"We are very satisfied to double our result over last year. We continue to deliver strong organic growth from a combination of strong market demand and the increased availability of products", says CEO Michael T. Andersen. "Integration of the acquired businesses is running to schedule and the financial results from the acquired businesses are in line with expectations."

Highlights for the period 1 January to 30 September 2018

DKK million  Q3 2018 Q3 2017 Q1-Q3 2018 Q1-Q3 2017
Revenue 720 430   1,863  1,252
Organic growth 21%  (2%)  15%  2%
EBITDA before special items  143   71  300  181
EBIT margin before special items * 14%   12%  10%  10%
Special items   16  5  39  19
Financial gearing  1.9  2.0  1.9  2.0
Free cash flow excluding acquisitions and divestments  131  45  156  (8)

* Margin for Q1-Q3 2018 are impacted by the planned standstill of the Borough Green factory and accelerated depreciations in
  relation to orderbooks and trademarks from the acquired businesses

Other highlights

  • Integration of the acquired businesses is running to schedule.
  •  The Borough Green factory is now getting close to full capacity utilization.
  •  The renovation of the CSU factory in Kavelstorf, Germany, was completed during the quarter.

Outlook for 2018
H+H updates its outlook for 2018:

  • Growth before acquisitions and measured in local currencies is expected to be around 15% (previously around 11%).
  • EBITDA before special items is expected to be DKK 390-410 million (previously DKK 370-410 million).
  • Approximately DKK 25-30 million costs are expected to be incurred as a result of the Borough Green factory upgrade and resulting need to import products from sister companies. The increased transportation costs will be expensed at the point of sale and treated as a special item (unchanged).
  • Approximately DKK 40 million for transaction and integration costs for HDKS and Grupa Silikaty will be expensed as special items (unchanged).
  • Investments excluding the acquisition of enterprises and related land, property and related deferred payments are expected to be in the region of DKK 135 million (previously DKK 150 million) of which approximately DKK 35 million relates to an investment required at one of the HDKS plants damaged by fire during the acquisition process. A similar amount was covered by a reduction in the purchase price.