Boryszew Group closes Q3 2021 with a profit hike
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17/05/2022Boryszew Group, one of the leading private industrial groups in Poland, has released the consolidated financial statements for the year 2021. In the reporting period, the Group’s consolidated revenue reached PLN 6.3 billion and was up by 13% on 2020. In 2021, Boryszew Group’s adjusted EBITDA (cleared of extraordinary and non-recurring items) stood at PLN 375 million, up by more than 8%.
The FY 2021 results confirm that Boryszew Group’s strength lies in the diversification of production. Prosperity on the Polish metals market allowed Boryszew to minimise the negative impact of the many challenges faced by the entire automotive industry in pandemic times to continuing production.
‘We closed the previous year with an adjusted consolidated EBITDA of PLN 375 million and a net consolidated profit of PLN 82 million. Such strong results, generated amid the very challenging economic environment, are twice as pleasing to us. Moreover, we improved our performance as measured by the financial ratios, with the working capital dropping, despite the high prices of key precious metals, by 14.1% and the net debt ratio falling to 1.8 against 2.5 in 2020,’ said Wojciech Kowalczyk, President of the Board and CEO of Boryszew S.A.
Boryszew Group operates through three segments. The largest share of the Group’s profits is generated by the Metals Segment, which accounts for almost 70% of the total consolidated revenues and over 80 per cent of the consolidated EBITDA. The Automotive Segment currently generates 25% of the Group’s revenues and less than 15% of the Group’s EBITDA, with the rest of the revenues coming from the Chemicals Segment and Others, which together account for 4% of the consolidated EBITDA.
Metals Segment
The Metals Segment’s FY 2021 EBITDA more than doubled year-on-year, reaching PLN 304 million (excluding Impexmetal S.A.), while the Segment’s revenues increased in the reporting period by 49% on 2020 to reach PLN 4.2 billion.
‘The results generated by this Segment of Boryszew Group’s operations are the effect of both consistent fulfilment of our plans and investment processes and of the favourable situation on the world markets, including the global trend of shortening supply chains. The greatest challenge faced by the Metals Segment last year were the soaring prices of raw materials, but we managed, to a large extent, to pass them on to our customers. Timeliness and reliability of deliveries remain the biggest concerns for all our European customers. I believe that Boryszew Group will benefit from this trend also in the following quarters,’ Boryszew President and CEO Wojciech Kowalczyk commented.
Automotive Segment
In the reporting period, Boryszew Group’s Automotive Segment generated revenues of PLN 1.6 billion (down by 2% year-on-year, while the Segment’s EBITDA was PLN 55 million (up by almost 70% year-on-year).
‘The Automotive Segment’s performance remains affected by the global shortage of semiconductor chips for car manufacturing. As previously announced, we spent the last few months on implementing optimisation measures in order to improve the Segment’s efficiency, which is already noticeable in the EBITDA margin. One of the radical steps taken as part of our ongoing efforts was the closure of the unprofitable production plant and tooling shop jointly operating under the name ICOS Group (part of Boryszew Automotive Plastics Group). Consequently, a restructuring provision was recognized for the discontinued operations of the ICOS Group, which was then charged against the EBITDA of the Automotive Segment’ CEO Kowalczyk explained.
Chemicals Segment
In FY 2021, Boryszew Group’s Chemicals Segment posted revenues of PLN 287.5 million, while the Segment’s EBITDA stood at PLN 2 million.
“The Chemicals Segment’s EBITDA was significantly affected by one-off write-downs on non-moving inventory. Moreover, the Segment’s performance in the fourth quarter of 2021 no longer included the results of Elana PET, which was sold last year. However, despite this temporary decline, we strongly believe that the strategy we have chosen for the Chemicals Segment and the decisions we made over the previous quarters with regard to it will not only boost the Group’s EBITDA in the future, but also improve the operational efficiency of this part of our business’ CEO Kowalczyk stated.
R&D&I activity in Boryszew Group
In 2021, Boryszew Group’s CAPEX totalled PLN 162 million.
‘As announced, some of our capital expenditure initially planned for 2021 has been postponed till 2022. The main reason for this are delays in investment processes due to extended delivery times, as well as the rising prices of infrastructure. This year’s CAPEX consists mainly of expenditure on automation in the Automotive Segment, plant modernisation in the Metals Segment and purchase of real estate’, Boryszew President and CEO Kowalczyk said.
In the following quarters, Boryszew Group plans to launch a number of product innovations, including high-precision cold drawn products from two-phase brasses in WM Dziedzice (Metals Segment), cooling fluids for hybrid technology (G12++, G13, G12EVO) and products for industrial metal cleaning in Boryszew ERG (Chemicals Segment) and hoses for air-conditioning systems using R744 (CO2) as refrigerant (Maflow Group, part of the Automotive Segment). Among technological innovations planned by the Group for this year are an automatic quality control and testing line for rings and rims with a smart fault identification and measurement system and a new production method of quality rolled bars at Huta Bankowa (Metals Segment).