From the Sector

The previously communicated targets for 2020 are unlikely to be achieved due to the COVID-19 pandemic

The Board of Management of SGL Carbon SE determined today, that the forecasted results for the fiscal year 2020 are unlikely to be achieved due to the global COVID-19 pandemic. In light of the substantial uncertainty regarding the duration and the consequences of the COVID-19 pandemic, the Board of Management is currently unable to provide a reliable sales revenue and earnings forecast for the current year. Consequently, the guidance for 2020 is suspended. 

The previous expectation, which guided for a slightly lower sales revenue und a recurring EBIT1 approximately 10-15% below the prior year (sales revenue 2019: €1,087m; recurring EBIT 2019: €48m), was already made conditional by the Board of Management in the management report published on March 12, 2020, that negative effects from the coronavirus were not included, as the outbreak at that time was mainly restricted to China and Italy. In the meantime, numerous other governments have introduced far-reaching measures with substantial limitations on the public and economic sectors and leading economists now forecast significant reductions in economic output in key economies. 

The Board of Management of SGL Carbon has introduced and partially already implemented comprehensive measures to reduce the cost base and to secure liquidity. These measures include the introduction of short-time work, reduction of material and indirect spend, as well as further reduction resp. postponement of capital expenditures. In addition, we are exploring further financing options independent of the capital markets, some of which are already in preparation. The Company is intensively working on identifying and mitigating potential risks. 

Perlon®, a Serafin Group company, is continuing to produce its’ quality filaments at all five sites for its’ customers in the current challenging climate. Production in China has been operating again as normal since the beginning of March after having to be temporarily halted due to the spreading of Covid-19. Production is now back up to 100%.

Production in Germany at our sites in Munderkingen (Baden-Wuerttemberg), Bobingen (Bavaria) and Wald-Michelbach (Hesse) as well as in the USA is continuing to run without any constraints. Therefore all sites are working to full capacity. In particular in the paper machine clothing area is showing an increase in sales which offsets a reduced demand in other areas such as automotive.

To manage the current situation responsibly, all hygiene measures at all our sites have been significantly increased so that the employees are protected as well as possible. There is hand sanitizer in every department and all of our production lines are disinfected several times a day. It has been explained to employees, what they should do in the current climate in order to minimise risk. Where possible employees are able to work from home. Perlon® has approximately 650 employees in Germany, over 80 in the USA and more than 100 in China.

High demand for monofilament for the paper industry
The paper industry is currently experiencing a rise in demand worldwide – and Perlon® is also benefitting from this, as customers need even more high quality monofilament and twisted yarns for the tensioning of paper machines. For the paper machine clothing field, Perlon® produced filaments are used to manufacture press fabric, which can be used either as a conveyor belt or for moisture removal on a paper production line. Due to the high mechanical strain through the presses, polyamide monofilaments or twisted yarns are therefore almost always used. Paper industry customers have increased their production recently. Whether it’s boxes to cope with the increased demand for online deliveries or paper for hygiene purposes (which everybody can identify with), there is an increased demand worldwide. The dental, hygiene and food preparation fields are also experiencing increased demand. To this end, Perlon® offers filaments for the manufacture of toothbrushes and high quality cleaning system brushes.

HeiQ, winner of the Swiss Technology Award and Swiss Environmental Award, launches HeiQ Viroblock NPJ03, an antiviral and antimicrobial textile treatment that is tested effective against coronavirus.

Since its inception 15 years ago, HeiQ has forged a solid innovation track record helping brands improve textile products. Catalyzed to action by the global fight against Coronavirus, HeiQ launches HeiQ Viroblock NPJ03, an antiviral and antimicrobial textile treatment which is proven effective against human coronavirus (229E) in face mask testing, significantly enhancing the antiviral log reduction from 2.90 of untreated face masks to 4.48, over 99.99% reduction of virus infectivity. (Remarks: a log reduction of 2 is equivalent to 100 times the effectiveness).

Chinese protective masks producer Suzhou Bolisi is the lead adopter of HeiQ Viroblock NPJ03. Treated masks will be available on the market as early as this April. American legwear manufacturer Kayser-Roth is planning to add the technology to their new product, Ghluv hands protector, while Lufeng from China is evaluating the technology on other types of fabric used for garments.

HeiQ Viroblock NPJ03 is a unique combination of vesicle and silver technologies designed to inhibit the growth and persistence of bacteria and viruses. The HeiQ vesicle technology targets lipid- enveloped viruses, such as coronavirus, providing rapid virus deactivation, while the HeiQ silver technology inhibits the replication of both bacteria and viruses. HeiQ Viroblock NPJ03 can be applied to a wide spectrum of textile surfaces including face masks, air filters, medical gowns, curtains, drapes and more. HeiQ also has a range of highly wash-durable antimicrobial and odor control textile technologies, called HeiQ Pure, combining silver-based and bio-based materials for all fabric types.