MERSEN (EPA:MRN) - Mersen : Continued Positive Momentum in the Third Quarter of 2018

Transparency directive : regulatory news

24/10/2018 17:40

PRESS RELEASE

MERSEN: CONTINUED POSITIVE MOMENTUM

* 10% LIKE-FOR-LIKE GROWTH IN SALES IN THE THIRD QUARTER OF 2018, LEADING TO
  GROWTH OF 10.7% FOR THE FIRST NINE MONTHS OF THE YEAR
* FIRST CONTRIBUTIONS FROM ACQUISITIONS IN POWER ELECTRONICS
* FULL-YEAR FORECASTS REVISED TO THE UPPER RANGE OF THE PREVIOUSLY PUBLISHED
  GUIDANCE:
o FULL-YEAR LIKE-FOR-LIKE GROWTH OF AROUND 9%
o OPERATING MARGIN BEFORE NON-RECURRING ITEMS OF AROUND 10.4%

PARIS, OCTOBER 24, 2018 - Mersen (Euronext FR0000039620 - MRN), a global expert
in electrical power and advanced materials, has reported consolidated sales of
EUR653 million for the first nine months of 2018.

Luc Themelin, Mersen's Chief Executive Officer, said: "We turned in an
excellent performance in the third quarter, with all of our businesses
contributing to growth in all geographic areas. Given these good results, we
expect to end the year with results in the upper range of the previously
published guidance. Thanks to our positioning in niche markets such as solar
power, compound semi-conductors and power electronics, we are confident in the
Group's growth potential in the medium term, despite the seemingly less
favorable geopolitical context compared with the first half of the year."

THIRD-QUARTER 2018 SALES

Mersen generated consolidated sales of EUR223 million in the third quarter of
2018, representing strong like-for-like growth of 10% year on year. Including
the consolidation of Idealec and FTCap (+3.8%) and a slightly negative currency
effect (-1%), sales grew by nearly 13% as reported.

In millions of euros     Q3 2018     Q3 2017     Like-for-like    Scope
                                                        growth   effect

Advanced Materials         124.0       108.0             16.1%     0.2%
Electrical Power            98.9        90.0              2.8%     8.0%
Europe                      73.4        63.6              6.1%    10.6%
Asia-Pacific                64.2        57.6             12.7%     0.4%
North America               75.5        68.8              8.8%     0.5%
Rest of the World            9.8         8.0             36.2%     1.3%
Group                      222.9       198.0             10.0%     3.8%

Currency
effect     Reported growth

-1.3%               14.8%
-0.7%               10.2%
-1.3%               15.4%
-1.2%               11.8%
  0.5%                9.9%
-7.1%               22.5%
-1.0%               12.7%

Advanced Materials sales totaled EUR124 million, representing like-for-like
growth of more than 16% over  the quarter, lifted by the solar and electronics
markets. The chemicals market was also particularly strong in Asia.

Electrical Power sales came to EUR99 million for the quarter, up by nearly 3%
like-for-like. This increase was driven by strong business levels in electrical
distribution and good performances in the solar and energy storage markets. The
segment also reaped the rewards of the first contributions from recently
acquired companies Idealec and FTCap.

In Europe, the Group performed very well in both business segments, with robust
growth in France, Germany and Spain, thanks to the renewable energies,
aeronautics and rail transportation markets.

Asia recorded another significant increase of nearly 13% in sales. Growth in
China was led by the solar, rail and chemicals markets, while an upturn in wind
power projects boosted sales in India.

Lastly, North America also saw significant growth in both business segments.
Electrical distribution sales were healthy, and the electronics sector
delivered strong growth, particularly the silicon carbide (SiC) application.

NINE-MONTH 2018 SALES

Mersen's consolidated sales for the first nine months of 2018 totaled EUR653
million, representing like-for-like growth of nearly 11% year on year.
Including the negative impact of exchange rates for approximately EUR25 million
and the effect of the first-time consolidation of Idealec and FTCap, growth
amounted to 7.6%.

In millions of euros     9 months   9 months    Like-for-like       Scope
                             2018       2017           growth      effect

Advanced Materials          364.2      335.2            13.2%        0.1%
Electrical Power            289.0      272.5             7.7%        3.1%
Europe                      220.3      199.5             7.7%        3.9%
Asia-Pacific                188.9      168.0            16.9%        0.2%
North America               217.4      215.3             7.9%        0.2%
Rest of the World            26.6       24.9            17.7%        0.4%
Group                       653.2      607.7            10.7%        1.4%

Currency
effect     Reported growth

-4.1%                8.6%
-4.1%                6.4%
-1.1%               10.4%
-3.7%               12.8%
-6.5%                1.1%
-9.7%                6.7%
-4.1%                7.6%

OUTLOOK FOR 2018

For full-year 2018, Mersen now expects like-for-like growth in sales of around
9%, which is in the upper range of the previously published guidance estimating
growth of between 7% and 9%. As a result, the Group's operating margin before
non-recurring items should come to around 10.4%, which, again, is in the upper
range of the previously reported guidance (between 10.1% and 10.4%).

To meet sustained demand in some of its expanding markets, such as solar and
electronics, the Group's investment outlay for 2018 is expected to total around
EUR55 million, compared with the EUR50 million that was initially planned(1).

GLOSSARY

Like-for-like growth: determined by comparing sales for the year with sales for
the previous year, restated at the current year's exchange rate, excluding
acquisitions and/or disposals and the impact of IFRS 15.

Scope effect: contribution from companies acquired in the year in relation to
sales for the year.

* Idealec, a recognized designer and manufacturer of laminated bus bars, has
  been consolidated within the Group since April 1, 2018.

* The acquisition of FTCap, a Germany-based company specializing in the
  development and production of capacitors, was finalized in July 2018. It has
  been consolidated in the Group's financial statements since July 1, 2018.

* Louisville Graphite Inc. (LGI), a company based in the United States which
  provides aftermarket and repair services, was acquired in July 2018. It has
  been consolidated in the Group's financial statements since July 1, 2018.

Currency effect: calculated by comparing sales for the previous year, at the
exchange rate of the previous year, with sales for the previous year at the
exchange rate of the current year.

(1) Excluding investments for the competitiveness plan

FINANCIAL CALENDAR

Fourth-quarter and full-year 2018 sales: January 30, 2019, after close of
trading.

ABOUT MERSEN

A global expert in electrical power and advanced materials, Mersen designs
innovative solutions to address its clients' specific needs to enable them to
optimize their manufacturing performance in sectors such as energy, electronics
transportation, chemicals & pharmaceuticals and process industries.

Mersen, with its 6,400 employees working across 35 countries, recorded sales of
EUR809 million in 2017.

MERSEN IS LISTED ON EURONEXT PARIS - COMPARTMENT B

INVESTOR AND ANALYST CONTACT        MEDIA CONTACT
Véronique Boca                      Stanislas Mulliez/Guillaume Granier
Vice-President, Communication
Mersen                              FTI Consulting Strategic Communications
Tel.: +33 (0)1 46 91 54 40          Tel.: +33 (0)1 47 03 68 10
Email: dri@mersen.com               Email: stanislas.mulliez@fticonsulting.com/
                                    guillaume.granier@fticonsulting.com

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MERSEN (EPA:MRN) - Mersen : Continued Positive Momentum in the Third Quarter of 2018

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