AMG Advanced Metallurgical Group N.V.
amsterdam : AMG

March 19, 2013 02:18 ET

AMG Reports Fourth Quarter and Full Year 2012 Results

AMSTERDAM, THE NETHERLANDS--(Marketwire - Mar 19, 2013) -


Key Highlights

* Revenue was $275.2 million in the fourth quarter 2012, an 11% decrease from the same period in 2011; full year revenue was $1,215.6 million, a 10% decrease from 2011

* EBITDA[1] was $17.7 million in the fourth quarter 2012, a 29% decrease from the same period in 2011; full year EBITDA was $84.8 million, a 23% decrease from the full year 2011

* EPS on a fully diluted basis was ($0.13) in the fourth quarter 2012 up from ($0.47) in the same period in 2011; full year EPS was $0.09

* The Advanced Materials Division generated revenue of $174.0 million and EBITDA of $10.0 million in Q4 2012; full year revenue and EBITDA were $791.3 million and $50.3 million, respectively

* The Engineering Systems Division generated revenue of $69.2 million and EBITDA of $7.2 million in Q4 2012; full year revenue and EBITDA were $273.8 million and $19.3 million, respectively

* Graphit Kropfmühl generated revenue of $31.9 million and EBITDA of $0.5 million in Q4 2012; full year revenue and EBITDA were $150.5 million and $15.2 million, respectively

* As of 31 December 2012, cash on the balance sheet was $121.6 million, net debt was $194.2 million

(Regulated Information) --- AMG Advanced Metallurgical Group N.V. ("AMG", EURONEXT AMSTERDAM: "AMG") reported fourth quarter 2012 revenue of $275.2 million an 11% decrease from $308.6 million in the fourth quarter 2011.

EBITDA decreased 29% to $17.7 million in the fourth quarter 2012 from $24.8 million in the fourth quarter 2011. Net loss attributable to shareholders for the fourth quarter 2012 was $3.5 million, or ($0.13) per fully diluted share. Net loss attributable to shareholders for the fourth quarter 2011 was $13.2 million, or ($0.47) per fully diluted share.

Full year 2012 revenue decreased 10% to $1,215.6 million, from $1,351.3 million in 2011. EBITDA decreased 23% to $84.8 million in 2012 compared to $110.1 million in 2011. Net income attributable to shareholders for the full year 2012 was $2.4 million, or $0.09 per fully diluted share a 54% decrease compared to net income attributable to shareholders for the full year 2011 of $5.2 million, or $0.19 per fully diluted share.

Dr. Heinz Schimmelbusch, Chairman of the Management Board and CEO, commented: "2012 was a year of change for AMG. We simplified our corporate structure through the acquisition and merger with Graphit Kropfmühl, streamlined the Management Board, and made changes in operational management. These changes should enable AMG to react more quickly to the ongoing sluggishness in global markets. This environment particularly affected AMG in the fourth quarter of 2012 as the sharp contraction in European economy resulted in lower revenue and earnings. Despite this, AMG generated positive net cash flow during the quarter through reductions in SG&A, and increased discipline in capital investment."


Key Figures

In 000's US Dollar

                      Q4 '12   Q4 '11 Change       FY '12     FY '11 Change



Revenue             $275,176 $308,574  (11%)   $1,215,602 $1,351,306  (10%)
---------------------------------------------------------------------------
Gross profit          41,398   50,515  (18%)      196,468    237,976  (17%)

Gross margin           15.0%    16.4%               16.2%      17.6%


---------------------------------------------------------------------------
Operating profit       4,051    9,778  (59%)       34,311     69,536  (51%)

Operating margin        1.5%     3.2%                2.8%       5.1%



Net (loss) income
attributable to
shareholders         (3,528) (13,197)    73%        2,392      5,160  (54%)
---------------------------------------------------------------------------


EPS- Fully diluted   ($0.13)  ($0.47)               $0.09      $0.19



EBIT ( (1))            7,407   16,424  (55%)       53,266     80,282  (34%)

EBITDA ((2))          17,712   24,779  (29%)       84,824    110,142  (23%)

EBITDA margin                6.4%     8.0%                7.0%       8.2%
---------------------------------------------------------------------------
Notes:
 1. EBIT is defined as earnings before interest and  tax and excludes
    nonrecurring items
 2. EBITDA is defined as earnings before interest, tax, depreciation and
    amortization and excludes nonrecurring items

Operational Review - Fourth Quarter 2012

Advanced Materials Division
                             Q4 '12     Q4 '11   Change
--------------------------------------------------------
 Revenue                   $174,049   $198,714    (12%)

 Gross profit                23,415     19,201      22%

 Operating profit (loss)      6,844   (10,864)      N/A

 EBITDA                      10,015      6,026      66%

 Capital expenditures        10,812     10,740       1%

The Advanced Materials Division's fourth quarter 2012 revenue decreased $24.7 million, or 12%, to $174.0 million. The decrease in revenue was primarily the result of 30%, 26% and 20% decreases in revenue from ferrovanadium, chrome and antimony, respectively, partially offset by a 61% increase in tantalum revenue, compared to the fourth quarter 2011.

The fourth quarter 2012 gross margin improved to 13% from 10% in the fourth quarter 2011. The improvement in gross margin was driven by cost improvements in aluminum master alloys and ferrovanadium and an increase in tantalum pricing.


The fourth quarter 2012 EBITDA increased $4.0 million to 6% of revenue from 3% of revenue in the fourth quarter 2011. The EBITDA increase was the result of the $4.2 million increase in gross profit and the $1.2 million decrease in personnel expenses, slightly offset by a $0.5 million decrease in the impact of foreign currency exchange.

Capital expenditures were $10.8 million for the fourth quarter 2012, a slight increase from the fourth quarter 2011. Growth capital investments made in the fourth quarter included $3.7 million for the expansion of the spent catalyst recycling facility for ferrovanadium production, $1.0 million related to expansion of the Brazilian tantalum mine and $4.4 million of maintenance capital investment.


Engineering Systems Division
                            Q4 '12    Q4 '11   Change
------------------------------------------------------
 Revenue                   $69,207   $72,851     (5%)

 Gross profit               16,176    21,800    (26%)

 Operating (loss) profit     (301)     6,028      N/A

 EBITDA                      7,195    11,772    (39%)

 Capital expenditures          163     6,289    (97%)

The Engineering Systems Division's fourth quarter 2012 revenue decreased $3.6 million, or 5%, to $69.2 million. Revenue from casting and sintering furnace systems increased 32% to $13.8 million and revenue from remelting furnaces, primarily for the aerospace industry, increased 1% to $15.1 million. These increases were more than offset by 91% and 27% decreases in solar silicon and heat treatment furnace revenue, respectively, compared to the fourth quarter 2011.

Order backlog increased 2% to $165.3 million as of December 31, 2012, from $162.2 million as of September 30, 2012. The division generated order intake of $67.8 million in the fourth quarter 2012, a 2% decrease compared to the fourth quarter 2011 and a 0.98x book to bill ratio. Turbine blade coating systems were the largest portion of the order intake accounting for 25% of the total.

The fourth quarter 2012 gross margin decreased to 23% from 30% in the fourth quarter 2011. Unfavorable product mix and lower revenues, resulting in a decline in the economies of scale, were the primary drivers of the decrease in gross margin.

The fourth quarter 2012 EBITDA decreased $4.6 million, to 10% of revenue from 16% of revenue in the fourth quarter 2011. The EBITDA decrease was primarily the result of the $5.6 million decrease in gross profit.

Capital expenditures were $0.2 million in the fourth quarter 2012, 97% less than the fourth quarter 2011. Capital investments in the fourth quarter were primarily maintenance capital expenditures for the Heat Treatment Services business.


Graphit Kropfmühl
                            Q4 '12   Q4 '11   Change
---------------------------------------------------------
 Revenue                   $31,920   $37,009       (14%)

 Gross profit                1,807     9,514       (81%)

 Operating (loss) profit   (2,492)    22,155         N/A

 EBITDA                        502     6,981       (93%)

 Capital expenditures        3,259     3,152          3%

Graphit Kropfmühl's fourth quarter 2012 revenue decreased $5.1 million, or 14%, to $31.9 million. Silicon metal revenue decreased $4.8 million, or 20%, due to a 46% decline in volumes due to postponed shipments, slightly offset by a favorable shift in average selling price. Natural graphite revenue decreased $0.3 million, or 2%, primarily because of a decrease in average selling price.

The fourth quarter 2012 gross margin decreased to 6% from 26% in the fourth quarter 2011. The decrease in gross margin was primarily the result of lower shipments of silicon metal and lower prices for natural graphite products.

The fourth quarter 2012 EBITDA decreased by $6.5 million to 2% of revenue from 19% of revenue in the fourth quarter 2011. The EBITDA decrease was the result of the decline in gross profit and the increase in SG&A due to merger expenses.

Capital expenditures were $3.3 million in the fourth quarter 2012, 3% more than the fourth quarter 2011. Capital expenditures included upgrading the electric arc furnaces in the silicon metal operation and expanding high purity natural graphite processing capacity.


Operational Review - Year 2012

Advanced Materials Division
                         FY '12     FY '11    Change
-----------------------------------------------------
 Revenue                $791,329   $871,939     (9%)

 Gross profit            112,766    118,931     (5%)

 Operating profit         28,902     19,639      47%

 EBITDA                   50,326     50,377        -

 Capital expenditures     32,331     29,064      11%

The Advanced Materials Division's 2012 revenue decreased by $80.6 million, or 9%, to $791.3 million. Decreases in average selling prices and volumes for antimony and aluminum master alloys and decreases in volumes for ferrovanadium and coatings were the primary cause for the decline in total revenue.

2012 gross margin remained constant at 14% compared to 2011, as the decline in revenue was offset by improved product mix and a reduction in operating costs.

2012 EBITDA remained consistent with 2011 at $50.3 million, or 6% of revenue. This was due to a $6.2 million decrease in gross profit, offset by a $9.4 million decline in SG&A expenses. SG&A expenses decreased 11% to $78.1 million in 2012 due to lower selling expenses and incentive compensation.

2012 capital expenditures were $32.3 million, 11% more than 2011. The division invested in growth capital expenditures in its ferrovanadium, antimony and tantalum operations during 2012 in an effort to increase capacity and ensure security of raw material supply.


Engineering Systems Division
                          FY '12     FY '11   Change
-----------------------------------------------------
 Revenue                $273,789   $313,830    (13%)

 Gross profit             60,698     83,707    (27%)

 Operating profit        (2,933)     20,424      N/A

 EBITDA                   19,286     33,969    (43%)

 Capital expenditures      5,410     13,386    (60%)

The Engineering Systems Division's 2012 revenue decreased $40.0 million, or 13% to $273.8 million. The decrease was the result of an 83% decline in solar silicon revenue, slightly offset by a 16% increase in revenue from remelting furnaces, primarily for the aerospace industry, and an 8% increase in Heat Treatment Services revenue. 2012 order intake was $276.0 million, down 6% from 2011.

2012 gross margin decreased to 22% from 27% in 2011 due to unfavorable product mix and lower revenues, resulting in a decline in economies of scale.

2012 EBITDA decreased by 43%, to $19.3 million or 7% of revenue due to a $23.0 million decrease in gross profit slightly offset by an $8.7 million decrease in SG&A expenses. SG&A expenses decreased 15% to $51.5 million due to a decline in professional fees and research and development spending.

2012 capital expenditures were $5.4 million, 60% less than 2011. The division limited investments to maintenance capital expenditures and additional capacity for the Heat Treatment Services facilities during 2012.


Graphit Kropfmühl
                          FY '12     FY '11   Change
-----------------------------------------------------
 Revenue                $150,484   $165,537     (9%)

 Gross profit             23,004     35,338    (35%)

 Operating profit          8,342     37,014    (77%)

 EBITDA                   15,212     25,796    (41%)

 Capital expenditures     10,369      9,472       9%

GK's 2012 revenue decreased by $15.1 million, or 9%, to $150.5 million. The decrease was the result of lower silicon metal and natural graphite pricing and volume.

2012 gross margin decreased to 15% from 21% in 2011 due to lower pricing, silicon metal production issues, and lower output that caused a decline in economies of scale.

2012 EBITDA decreased 41% to $15.2 million, or 10% of revenue due to a $12.3 million decrease in gross profit and a $0.4 million, or 3%, increase in SG&A. Gross profit included an increase of $1.7 million of depreciation expense in 2012 related to revalued assets, which is not included in EBITDA.

Capital expenditures were $10.4 million in 2012, 9% more than 2011. GK invested in upgrading and expanding its natural graphite production capabilities and furnace upgrades in the silicon metal operation.

Financial Review

Taxes

AMG recorded a tax expense of $10.8 million, or a 99% effective tax rate in 2012, compared to a tax expense of $18.7 million, or a 69% effective tax rate, in 2011. The high 2012 tax rate is due to a significant portion of restructuring and asset impairment expenses for which a tax benefit cannot be booked. Excluding these non-recurring non-deductible expenses, the effective tax rate would have been 40%.

SG&A

AMG's fourth quarter 2012 SG&A expenses were $34.0 million, compared to $42.5 million in the fourth quarter 2011, a decrease of 20%. The $8.5 million decrease was primarily due to a $7.5 million noncash charge that occurred in 2011 for the write down of assets related to Timminco.

For the full year 2012, AMG's SG&A expenses were $145.6 million, compared to $170.8 million in 2011, a decrease of 15%. The $25.2 million decrease was due to an $11.1 million decrease in personnel costs, $7.5 million decline in noncash charges related to Timminco in 2011 and a $2.7 million decrease in professional fees.

Non-Recurring Items

AMG's 2012 operating profit of $34.3 million includes non-recurring items, which are not included in the calculation of EBITDA. These items are comprised of income and expense items, that in the view of management, do not arise in the normal course of business and items that, because of their nature and/or size, should be presented separately to enable better analysis of the results.

A summary of non-recurring items affecting the 2012 and 2011 results is presented below:

                                                  For the twelve months
                                                  ended

                                                  December     December
                                                    2012         2011
---------------------------------------------------------------------------
Non-recurring items included in operating profit:

Provisions for Timminco receivables and notes            -            7,541

Restructuring expense                                6,151            2,526

Environmental expense                                1,772            5,886

Impairment of ESD assets                             9,891           14,992

Reversal of impairment of GK assets                      -         (16,909)

Bargain purchase gain on acquisition                     -          (5,361)
---------------------------------------------------------------------------
Total non-recurring items included in operating
 profit                                             17,814            8,675
---------------------------------------------------------------------------

---------------------------------------------------------------------------
Non-recurring losses from investment in Timminco         -           17,706
---------------------------------------------------------------------------

---------------------------------------------------------------------------
Non-recurring losses (gains) from revaluation of
Timminco convertible debt included in finance costs      -            2,624
---------------------------------------------------------------------------

Currency Fluctuations

AMG transacts business in many currencies other than the U.S. dollar, the Company's reporting currency. AMG's financial statements are prepared in U.S. dollars, so fluctuations in the exchange rates between the U.S. dollar and other currencies have an effect both on the results of operations and on the reported value of assets and liabilities as measured in U.S. dollars. The depreciation in the value of the U.S. dollar as of December 31, 2012 compared to September 30, 2012, resulted in an increase in the assets and liabilities on the balance sheet of $15.0 million and $9.6 million, respectively. The net result of the appreciation in the value of the U.S. dollar in the fourth quarter 2012 compared to the fourth quarter 2011, resulted in a decrease in revenue and EBITDA of $6.2 million and $0.5 million, respectively.

Liquidity
                             December 31, 2012   December 31, 2011   Change
---------------------------------------------------------------------------
 Total debt                          $315,844            $268,621      18%

 Cash & short-term investments        121,639              79,571      53%
---------------------------------------------------------------------------
 Net debt                             194,205             189,050       3%

AMG had a net debt position of $194.2 million as of December 31, 2012. AMG's net debt position increased $5.2 million since December 31, 2011 primarily due to $48.1 million in capital investments, $18.6 million of net cash interest payments, $15.3 million in Graphit Kropfmühl share purchases, $12.6 million of cash tax payments, $3.1 million for severance and other restructuring payments reduced by $84.8 million of EBITDA and a $9.9 million decrease in working capital and provisions. Including the $121.6 million of cash, AMG had $172.4 million of total liquidity as of December 31, 2012.

Cash Flow
                                               For the twelve months ended
---------------------------------------------------------------------------
                                               December       December
                                                 2012           2011
---------------------------------------------------------------------------
 Net cash flows from operations                 $65,637            $45,039
---------------------------------------------------------------------------
 Capital expenditures                          (48,109)           (51,922)

 Acquisitions, net of cash                        (166)           (29,345)

 Cash flows used in other investing               (264)            (1,455)
---------------------------------------------------------------------------
 Net cash flows used in investing activities   (48,539)           (82,722)
---------------------------------------------------------------------------
 Cash flows generated from financing activities 21,661             27,824
---------------------------------------------------------------------------

Cash flows from operations were $65.6 million in 2012 compared to cash flows from operations of $45.0 million in 2011. The 2012 cash flows from operations are primarily the result of $84.8 million in EBITDA and a $9.9 million decrease in working capital less $18.6 million in net cash interest payments and $12.6 million in cash tax payments.

Cash used in investing activities was $48.5 million in 2012, of which $15.8 million was maintenance capital investments. The $34.2 million decrease compared to 2011 is composed of a $29.2 million decrease in acquisitions and a $3.8 million decrease in capital expenditures. In 2011, AMG acquired KB Alloys and AMG Intellifast for $29.1 million. AMG's acquisition of Graphit Kropfmühl is classified as a financing activity in 2012.

Cash generated from financing activities was $21.7 million in 2012, a $6.2 million decrease from 2011. This decrease was primarily attributable to the acquisition of 11.8% of Graphit Kropfmühl's outstanding common shares in 2012 for $15.3 million, including related costs, reduced by a $9.0 million increase in net proceeds from issuance of debt and repayment of borrowings in 2012. AMG increased the capacity of its credit facility in 2012. The proceeds of this expansion of credit were used to fund the Brazilian mine expansion and the acquisition of Graphit Kropfmühl shares as well as to retire Graphit Kropfmühl's external debt.

Outlook

AMG is implementing changes to its reporting and operational structure in 2013. Effective January 1, 2013, to better coordinate organizational responsibilities and value chains, and improve transparency, AMG has realigned its three operating units as follows: AMG Processing, AMG Mining and AMG Engineering. AMG Processing contains the "conversion" activities, i.e. purchasing and upgrading of high performance materials. AMG Mining includes AMG's mine based material value chains, i.e. tantalum, niobium, antimony, graphite and silicon. AMG Engineering contains the same operating activities as in 2012. AMG will provide segment reporting for these three entities on a go forward basis.

In this environment of slow global growth, AMG is implementing measures to improve cash flow through reductions in capital investment and improved working capital management. In 2013 AMG is targeting an increase in operating margins through SG&A cost reductions, operational realignment and more streamlined management decision-making. Despite the low growth environment, this should generate increased cash flow and EBITDA leading to a reduction in net debt in 2013.

AMG Advanced Metallurgical Group N.V.
Consolidated Income Statement

For the three months ended December
31

In thousands of US Dollars                                 2012        2011

Continuing operations

Revenue                                                 275,176     308,574

Cost of sales                                           233,778     258,059

Gross profit                                             41,398      50,515



Selling, general and administrative
expenses                                                 34,011      42,457

Restructuring expense                                     1,349          30

Asset impairment expense (reversal)                       3,553     (1,917)

Environmental (reversal) expense                        (1,228)       5,504

Other income, net                                         (338)     (5,337)

Operating  profit                                         4,051       9,778



Finance expense                                           8,045       6,867

Finance income                                            (196)     (1,464)

Foreign exchange loss                                       771         838

Net finance costs                                         8,620       6,241



Share of  income (loss) of
associates and joint ventures                             1,896    (13,514)

Loss before income tax                                  (2,673)     (9,977)



Income tax expense                                        1,994       2,155

Loss for the period                                     (4,667)    (12,132)





Attributable to:

  Shareholders of the Company                           (3,528)    (13,197)

  Non-controlling interests                             (1,139)       1,065

                                                        (4,667)    (12,132)

Earnings per share

Basic earnings per share                                 (0.13)      (0.47)

Diluted earnings per share                               (0.13)      (0.47)




AMG Advanced Metallurgical Group
N.V.

Consolidated Income Statement



For the year ended December 31

In thousands of US Dollars                                  2012       2011

Continuing operations

Revenue                                                1,215,602  1,351,306

Cost of sales                                          1,019,134  1,113,330

Gross profit                                             196,468    237,976



Selling, general and administrative
expenses                                                 145,569    170,772

Restructuring expense                                      6,151      2,526

Asset impairment expense (reversal)                        9,891    (1,917)

Environmental expense                                      1,772      5,886

Other income, net                                        (1,226)    (8,827)

Operating  profit                                         34,311     69,536



Finance expense                                           26,256     26,370

Finance income                                           (1,051)    (5,457)

Foreign exchange loss                                        581      1,366

Net finance costs                                         25,786     22,279



Share of  income (loss) of
associates and joint ventures                              2,353   (20,265)

Profit before income tax                                  10,878     26,992



Income tax expense                                        10,808     18,702

Profit for the year                                           70      8,290





Attributable to:

  Shareholders of the Company                              2,392      5,160

  Non-controlling interests                              (2,322)      3,130

                                                              70      8,290

Earnings per share

Basic earnings per share                                    0.09       0.19

Diluted earnings per share                                  0.09       0.19


AMG Advanced Metallurgical Group N.V.

Consolidated Statement of Financial
Position



As at December 31

In thousands of US Dollars                                  2012       2011



Assets

   Property, plant and equipment                         288,269    263,586

   Goodwill                                               24,751     23,535

   Intangible assets                                      13,971     14,557

   Investments in associates and
   joint ventures                                          7,351      5,085

   Derivative financial instruments                          527          1

   Deferred tax assets                                    28,777     29,142

   Restricted cash                                        11,888     11,074

   Notes receivable                                          227        250

   Other assets                                           18,463     17,866

Total non-current assets                                 394,224    365,096

   Inventories                                           211,531    228,887

   Trade and other receivables                           177,232    188,103

   Derivative financial instruments                        3,229      3,956

   Other assets                                           40,066     35,184

   Cash and cash equivalents                             121,639     79,571

Total current assets                                     553,697    535,701

Total assets                                             947,921    900,797



Equity

   Issued capital                                            743        742

   Share premium                                         382,176    381,921

   Other reserves                                         32,823     26,771

   Retained earnings (deficit)                         (205,015)  (203,976)

Equity attributable to shareholders of
the Company                                              210,727    205,458



Non-controlling interests                                  6,818     15,160



Total equity                                             217,545    220,618



Liabilities

   Loans and borrowings                                  265,553    210,448

   Employee benefits                                      92,844     90,078

   Provisions                                             31,852     27,019

   Deferred revenue                                        2,724          -

   Government grants                                         472        732

   Other liabilities                                       6,690      9,276

   Derivative financial instruments                       11,082      8,122

   Deferred tax liabilities                               28,102     26,434

Total non-current liabilities                            439,319    372,109



   Loans and borrowings                                   20,333     17,436

   Short term bank debt                                   29,958     40,737

   Government grants                                          55         34

   Other liabilities                                      58,934     51,673

   Trade and other payables                              125,342    128,493

   Derivative financial instruments                        3,900     10,661

   Advance payments                                       26,989     30,204

   Deferred revenue                                        2,533          -

   Current taxes payable                                   8,623     14,468

   Provisions                                             14,390     14,364

Total current liabilities                                291,057    308,070

Total liabilities                                        730,376    680,179

Total equity and liabilities                             947,921    900,797

AMG Advanced Metallurgical Group N.V.

Consolidated Statement of Cash Flows



For the year ended December 31

In thousands of US Dollars                                   2012      2011

Cash flows from operating activities

Profit for the year                                            70     8,290

Adjustments to reconcile net profit to net cash
flows:

Non-cash:

   Income tax expense                                      10,808    18,702

   Depreciation and amortization                           31,558    29,625

   Amortization of purchase accounting adjustment to
inventory                                                       -       235

   Asset impairment expense (reversal)                      9,891   (1,917)

   Net finance costs                                       25,786    22,279

   Share of (profit) loss  of associates and joint
ventures                                                  (2,353)    20,265

   Loss on sale or disposal of property, plant and
equipment                                                     327        50

   Equity-settled share-based payment transactions          1,724     3,438

   Movement in provisions, pensions and government
grants                                                      9,088     9,266

Working capital adjustments

   Change in inventories                                   17,698  (19,963)

   Change in trade and other receivables                   25,535  (24,749)

   Change in prepayments                                  (8,353)     8,440

   Change in trade payables and other liabilities        (26,159)    18,699

   Other                                                    1,189   (1,380)
                                                        -------------------
-
Cash flows from operating activities                       96,809    91,280

Finance costs paid                                       (19,123)  (14,593)

Finance costs received                                        522     2,530

Income tax paid, net                                     (12,571)  (34,178)
                                                        -------------------
-
Net cash flows from operating activities                   65,637    45,039


Cash flows used in investing activities

Proceeds from sale of property, plant and equipment           332       609

Acquisition of subsidiaries (net of cash acquired
$133 and $3,856, respectively)                              (166)  (29,345)

Acquisition of property, plant and equipment and
intangibles                                              (48,109)  (51,922)

Related party loans                                             -   (5,002)

Change in restricted cash                                   (671)     1,369

Other                                                          75     1,569
                                                        -------------------
-
Net cash flows used in investing activities              (48,539)  (82,722)
                                                        -------------------
-

AMG Advanced Metallurgical Group N.V.

Consolidated Statement of Cash Flows (continued)



For the year ended December 31

In thousands of US Dollars                                   2012      2011



Cash flows from financing activities

Proceeds from issuance of debt                             72,078   227,511

Payment of transaction costs related to debt issuance           -  (10,848)

Repayment of borrowings                                  (35,126) (188,740)

Acquisition of non-controlling interests                 (15,291)     (111)

Other                                                           -        12
                                                        -------------------
-
Net cash flows from financing activities                   21,661    27,824
                                                        -------------------
-


Net increase (decrease) in cash and cash equivalents       38,759   (9,859)

Cash and cash equivalents at January 1                     79,571    89,311

Effect of exchange rate fluctuations on cash held           3,309       119
                                                        -------------------
-
Cash and cash equivalents at December 31                  121,639    79,571

About AMG

AMG creates and applies innovative metallurgical solutions to the global trend of sustainable development of natural resources and CO(2) reduction. AMG produces highly engineered specialty metal products and advanced vacuum furnace systems for the Energy, Aerospace, Infrastructure and Specialty Metals and Chemicals end markets.

AMG Processing develops and produces specialty metals, alloys and high performance materials. AMG is a significant producer of specialty metals, such as ferrovanadium, ferronickel-molybdenum, aluminum master alloys and additives, chromium metal and ferrotitanium, for Energy, Aerospace, Infrastructure and Specialty Metal and Chemicals applications. Other key products include specialty alloys for titanium and superalloys, coating materials and vanadium chemicals.

AMG Engineering designs, engineers and produces advanced vacuum furnace systems and operates vacuum heat treatment facilities, primarily for the Aerospace and Energy (including solar and nuclear) industries. Furnace systems produced by AMG include vacuum remelting, solar silicon melting and crystallization, vacuum induction melting, vacuum heat treatment and high pressure gas quenching, turbine blade coating and sintering. AMG also provides vacuum case-hardening heat treatment services on a tolling basis.

AMG Mining produces critical materials utilizing its secure raw material sources in Africa, Asia, Europe and South America. AMG Mining produces critical materials such as high purity natural graphite, tantalum, antimony and silicon metal. These materials are of significant importance to the global economy and are available in limited supply. End markets for these materials include electronics, energy efficiency, green energy and infrastructure.

With over 3,200 employees, AMG operates globally with production facilities in Germany, the United Kingdom, France, Czech Republic, United States, China, Mexico, Brazil, Turkey, Poland, India and Sri Lanka and has sales and customer service offices in Belgium, Russia and Japan (www.amg-nv.com).

Disclaimer

Certain statements in this press release are not historical facts and are "forward looking." Forward looking statements include statements concerning AMG's plans, expectations, projections, objectives, targets, goals, strategies, future events, future revenues or performance, capital expenditures, financing needs, plans and intentions relating to acquisitions, AMG's competitive strengths and weaknesses, plans or goals relating to forecasted production, reserves, financial position and future operations and development, AMG's business strategy and the trends AMG anticipates in the industries and the political and legal environment in which it operates and other information that is not historical information. When used in this press release, the words "expects," "believes," "anticipates," "plans," "may," "will," "should," and similar expressions, and the negatives thereof, are intended to identify forward looking statements. By their very nature, forward looking statements involve inherent risks and uncertainties, both general and specific, and risks exist that the predictions, forecasts, projections and other forward looking statements will not be achieved. These forward looking statements speak only as of the date of this press release. AMG expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward looking statement contained herein to reflect any change in AMG's expectations with regard thereto or any change in events, conditions, or circumstances on which any forward looking statement is based.

[1] EBITDA is defined as earnings before interest, tax, depreciation and amortization and excludes nonrecurring items


AMG Q4 2012: http://hugin.info/138060/R/1686191/552667.pdf

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Source: AMG Advanced Metallurgical Group N.V. via Thomson Reuters ONE

[HUG#1686191]

Contact Information

  • For further information, please contact:
    AMG Advanced Metallurgical Group N.V.
    +1 610 975 4901
    Jonathan Costello
    Vice President of Corporate Development and Corporate Communications
    Email Contact