As communicated by Sabaf, the Group reported revenue of 64.9 million euro in the first half of 2016, a decrease of 10.6% versus the figure of 72.5 million in the corresponding period of the previous year. The decline in sales is mainly attributable to the economic downturn in some of the main markets in which the group operates, such as Egypt and Brazil. Sales in Italy, which have been associated with customers with a strong focus on exports – mainly in North Africa and the Middle East – have also been affected by the difficult economic and socio-political scenario of this geographical area. Average sale prices for the period were down by 1.6% versus the first half of 2015.
The analysis per product family shows a more marked decrease of brass valves and thermostats, products intended mainly for the North African and Middle East markets. During the first half of the year, the Group has benefited, apart from the reduction in the costs of acquisition of raw materials (estimated at 1% of sales) and the favourable exchange rate development (estimated at 0.8% of sales), from the improvement in efficiency of the production
processes following further technical and organisational measures. “Therefore – explains the company – the profitability of the period, although affected by the low sales volumes, stood at satisfactory levels: EBITDA of the first half of 2016 came in at 12.4 million euro (19.1% of sales and down 13.9% on the same period of 2015, when it was 19.8% of sales) and EBIT was 6 million (9.3% of sales, down by 28% on the figure of 8.4 million for the first half of 2015). Pretax profit amounted to 5.9 million euro in H1 2016 (8.2 million in H1 2015), and net profit was 3.9 million (5.5 million in H1 2015, a drop of 27.9%)”. Investments in H1 2016 were 7 million euro (7.9 million in H1 2015); the largest investments were for increasing production capacity in Turkey and in Brazil, where the production of triple crown burners for the local market got under way.
Besides, sales in the second quarter of 2016 amounted to 34 million euro, a drop of 2.9% compared to 35 million in the same period of 2015. In the period there was a more regular development of demand, and some signs of recovery have been noticed in the markets that suffered most at the start of the year, such as Egypt and Turkey. Second-quarter EBITDA was 6.8 million, equivalent to 20% of sales (+1.8% versus 6.7 million in Q2 2015, when it was 19% of sales), and EBIT was 3.6 million, equivalent to 10.5% of sales (-2% versus 3.7 million in Q2 2015, when it was 10.4% of sales). Net profit for the period was 2.4 million euro, versus 2.3 million for Q2 2015 (+1.6%). As regards to the forecasts for the rest of the year, Sabaf says that sales and orders for July and August show a substantial stability versus the same period of 2015. The Group confirms the forecasts of a modest decline in sales and profitability for the full year 2016.
