AUSTRIA: RHI'S PLANS

Article Abstract:

The Austrian refractories and insulation materials producer RHI AG is planning to sell its insulation materials division unless the operations raise profit margin from 2.5% to 5% in year 2000. On the other hand, the group is looking for a European minority partner for another insulation materials division . The company sees great potential for mineral wool. Paroc of Finland is considered a suitable partner. Such a partnership would make RHI the second-biggest producer of insulation materials, behind Rockwool. In year 2000 RHI aims to raise earnings before interest and taxes to Sch 2bn. In 1999 it fell 35% to Sch 721mn, while profit on ordinary activities dropped 39% to Sch 555mn. Group loss amounted to Sch 358mn. Equity ratio, which fell from 18.8% to 12.6% in 1999 as a result of the acquisition of the refractories maker GIT/Harbison Walker in the US, is to be doubled in the medium term. The world's biggest refractories producer expects the favourable development of the refractories market to continue beyond year 2000. Both demand and prices are rising.

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AUSTRIA: IMPROVEMENT FOR RHI

Article Abstract:

The Austrian refractories and insulation materials producer RHI AG expects to reach the profit target of EUR 245mn in year 2000. In the first quarter of the year earnings before interest and taxes amounted to EUR 14.5mn, compared with a loss of EUR 3.1mn in the year earlier period. Turnover surged 42% to EUR 516mn. Adjusted for the acquisition of the US refractories maker GIT/Harbison Walker, sales increased 7%.

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AUSTRIA: RHI TALKS ABOUT DIVESTMENT, PARTNERSHIP

Article Abstract:

Chairman Georg Obermeier expects RHI to conclude talks by mid-March 2001 about the sale of the water-proofing materials division (Vedag-Villas). Three interested parties are conducting due diligence studies. One of the three bids involves a management buy-out. The water-proofing division of RHI employs 750 staff. The divestment could raise Sch 700mn for RHI, which has debts of close to Sch 17bn. On the other hand, talks about a partnership in the field of insulation materials are to be concluded by mid-2001. Paroc of Finland and Rigips of the UK are said to be interested in taking a stake in the RHI division (Heraklith) in which the Austrian company wants to keep 50%. Together with the partner, RHI wants to become Europe's second-biggest supplier of mineral wool. In its core business of refractory materials, RHI is to reduce the number of staff by 600 in 2001. About 1,500 jobs were cut already in 2000. In year 2000 RHI doubled its profits but remained 10% short of the target of an operating profit of Sch 2bn.

Strategy & planning, Foreign operations, Joint ventures

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