Masterflex SE: Solid Growth with Cost Stability

Revenue + 4.2% * EBIT + 9.5% * EPS at Eur 0.26 * Multifunctional food hose launched

Gelsenkirchen (pta006/14.11.2016/07:59 UTC+1) The market and technology leader in the field of sophisticated connection and hose systems successfully continued its growth while maintaining a disciplined approach to costs. Revenue rose to Eur 51.1 million in the first nine months, increasing 4.2% against the same period of the previous year (Eur 49.0 million). The operating result (EBIT) climbed by as much as 9.5% to its current level of Eur 4.9 million (previous year: Eur 4.4 million). The resulting EBIT margin amounts to 9.5% (9.0%).

Dr Andreas Bastin, CEO of the innovative connection specialist, commented: "We are on the right track although our operating margin is still somewhat below our target of a double-digit margin. At the end of 2015 we decided to focus on costs and have since done so without losing sight of our revenue targets. Our package of measures is working: optimisation of diverse processes and procedures has been put into effect in all areas. However, it will be some time yet before we see the full effects in terms of Euros and Cents."

The focus on costs is reflected in all the relevant line items in the first nine months of 2016: at Eur 16.1 million, material costs remained virtually the same as in the previous year (Eur 16.0 million); the materials usage ratio (cost of materials in relation to revenue plus changes in inventories) was lower than that of the previous year (31.9%) at 31.4%. Only personnel costs rose slightly by 1.4% from Eur 19.4 million to Eur 19.6 million as a result of growth. However, the staff cost ratio decreased as well to 38.3%, compared to 38.5% in the first nine months of 2015. In contrast, at Eur 9.3 million other material costs were 1.4% lower than in the previous year (Eur 9.5 million). Furthermore, depreciation and amortisation of assets declined again to Eur 2.0 million, although this is expected to increase somewhat due to the commissioning of new buildings and equipment.

The Masterflex Group expects further efficiency gains thanks to the building extension recently commissioned at its Gelsenkirchen headquarters (see release dated 2 November 2016). "In the short and medium term this will lead to further savings on external areas that are no longer needed as well as to optimised production and logistics," Bastin emphasised.

Business in the international markets has developed particularly well this year. Bastin: "I'm pleased to say our US business is doing particularly well; the effect of the new management is clear to see there. The Asia business, particularly in China, also continues to show strong growth. The strategic significance of our internationalisation programme is becoming increasingly clear."

The Masterflex Group's financial result amounted to Eur -0.9 million after the first nine months. The negligible decline against the previous year (Eur -0.8 million) is largely based on ancillary costs for the new syndicated loan concluded in the spring.

Consolidated net profit amounted to Eur 2.2 million, including the extraordinary expenses of Eur 0.6 million from discontinued operations attributable to the Higher Regional Court judgment pronounced in the summer (see release dated 16 June) and minority interests. Earnings per share thus amounted to Eur 0.26 (previous year: Eur 0.26). "We have therefore now fully compensated the negative effect from the Higher Regional Court decision, against which we have also lodged an appeal," Bastin pointed out.

As part of its innovation strategy, the Masterflex Group launched an enhanced spiral hose, the Master-PUR Food A Multi, on the market in the third quarter of 2016. The particular strength of this PU suction hose lies in its suitability for transporting all foods, not just dry products. This hose can thus be used in multiple functions within the food sector - a strength from which it also takes its name. The food hose family, which also has approval in the US, has been well received in the market.

The table below shows the most important key figures for Q3/2016.

The full interim financial statements as of 30 September 2016 are also available online at http://masterflexgroup.com/en/investor-relations/financial-reports/financial-reports-2016.html

(end)

Emitter:	Masterflex SE Willy-Brandt-Allee 300 45891 Gelsenkirchen Germany
Contact Person:	Dr. Annette Littmann
Phone:	+49 209 97077-0
E-Mail:	a.littmann@masterflexgroup.com
Website:	www.MasterflexGroup.com
ISIN(s):	DE0005492938 (Share)
Stock Exchange(s):	Regulated Market in Frankfurt; Free Market in Berlin, Dusseldorf, Hamburg, Munich, Stuttgart