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Fuchs Petrolub FY19 Profit Declines; Sees Lower Results In 2020

Fuchs Petrolub AG (FUPEF.PK), a company engaged in the lubricant business, reported that its profit after tax for the year 2019 declined 21 percent to 228 million euros, from 288 million euros in the prior year. Earnings per ordinary share was 1.63 euros, compared to 2.06 euros last year.

Earnings before interest and tax or EBIT decreases by 16% to 321 million euros from the previous year.

On a comparable basis, excluding the one-off effect from the sale of the trading joint venture in Switzerland in 2018, EBIT was 13% or 50 million euros below the previous year. The decline in earnings at constant sales was due to the planned increase in the cost base, the growth and investment program and the decline in volume as a result of the weak economic environment.

Annual sales revenues were 2.57 billion euros, unchanged from last year.

FUCHS expected growth in sales revenues of between 0% and 4% for the year 2020 when the 2019 annual financial statements were prepared on March 4. This is based both on organic volume growth and external growth. The latter is mainly due to the acquisition of NYE, a manufacturer of synthetic high-performance lubricants in the US, which was completed at the end of January 2020.

FUCHS also expected a slight increase in EBIT of between 0% and 4% for 2020. The negative effects of the coronavirus on the global economy and the FUCHS Group cannot be estimated at present.

However, they will at least temporarily lead to significant declines in sales and earnings.

FUCHS plans to invest 120 million euros, particularly in Germany, the US, China, South Africa, Russia and Sweden.

The company said it will not hold the Annual General Meeting on May 5, 2020, amide coronavirus outbreak and the current nationwide ban on events. The Annual General Meeting will probably take place in the second half of June.

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