From the Sector

• Group sales increases by approximately 6 percent compared to the prior year period to 832 million euros due to organic growth in the market segments Digitization, Energy and Chemicals
• Group recurring EBIT at around 54 million euros; adjusted for a positive one-time effect in the prior year approximately on the comparable level of the prior year
• Business unit Composites – Fibers & Materials (CFM) deteriorated substantially in the third quarter 2019 due to the weak development in the market segments Textile Fibers, Wind Energy and Industrial Applications; Graphite Materials & Systems (GMS) developed better than expected on the very good level of the prior quarter reaching overall a record high level in 9M/2019
• Free cash flow from continuing operations improved significantly in the first nine months
• Impairment testing triggers a non-cash impairment charge of approximately 75 million euros in CFM in the third quarter
• Revised guidance of October 25, 2019: Recurring EBIT at CFM in a negative mid-to-high single digit million euros amount and on Group level at 45 to 50 million euros
• Countermeasures initiated to improve earnings of CFM
• Dr. Michael Majerus, Spokesman of the Board of Management of SGL Carbon: ”The structural growth drivers remain intact in our strategically relevant markets. The countermeasures to improve earnings of CFM will be implemented consistently.”

In the third quarter 2019, the business units of SGL Carbon developed very differently. While Graphite Materials & Systems (GMS) showed better than expected results, Composites – Fibers & Materials (CFM) deteriorated compared to the two previous quarters. This is attributable to the weaker development in the market segments Textile Fibers and Industrial Applications. In total, sales revenue in the first nine months 2019 grew by approximately 6 percent to reach 832 million euros. Recurring Group EBIT after nine months reached approximately 54 million euros. Adjusted for a positive one-time effect in the prior year, this was comparable to the prior year level.

In its ad-hoc notification of October 25, 2019, the company revised its guidance for recurring EBIT of CFM downwards to a negative mid to high single digit million euro amount. On the Group level the company now expects a recurring EBIT at 45 to 50 million euros. Due to the lower starting point in 2019 as well as the ongoing weakness in the market segments Textile Fibers and Industrial Applications in the business unit CFM a non-cash impairment charge in the amount of approximately 75 million euros was recorded in the third quarter 2019. In recent years acquired assets of the former joint ventures with BMW and Benteler were not affected by this impairment. In addition, the impairment charge of CFM led to a valuation allowance on deferred tax assets in the amount of 7.4 million euros. Against this background, SGL Carbon now expects a net result of approximately minus 100 million euros for fiscal year 2019.

• Order intake of CHF 524.5 million after nine months
• Order intake for a major project from Egypt booked in October 2019
• Market situation remains challenging
• Real estate sale in Ingolstadt successfully completed
• Outlook 2019

The cumulative order intake recorded by Rieter Group in the first nine months of 2019 of CHF 524.5 million (2018: CHF 749.8 million) was down by 30% compared to the prior-year period. In the third quarter of 2019, order intake was CHF 146.2 million (Q3 2018: CHF 238.0 million).

Order Intake for a Major Project from Egypt Booked
On October 7, 2019, Rieter booked the order intake for the first six projects with Cotton & Textile Industries Holding Company, Cairo (Egypt) of around CHF 165 million. This amount is thus not included in the figures for the third quarter of 2019 and will positively affect the fourth quarter. The sales are anticipated to be realized in the 2020/2021 financial years. The order includes deliveries of compact and ring spinning systems and it is part of a comprehensive modernization program for the Egyptian textile industry.

Market Situation Remains Challenging
The demand for new machinery remained at a low level in the third quarter of 2019. The primary reasons are existing overcapacity in the spinning mills, the trade conflict between the USA and China, as well as political and economic uncertainties in other regions of importance to Rieter. Rieter's market share continues to be at the level of around 30%.

Real Estate Sale in Ingolstadt Successfully Completed
Rieter completed the real estate sale in Ingolstadt (Germany) to GERCHGROUP of Düsseldorf (Germany) on September 13, 2019. Rieter expects a non-recurring profit contribution from this transaction on a net profit level of around EUR 60 million.

Outlook 2019
Rieter estimates significantly lower sales for the year 2019 as a whole compared to 2018, and expects a significant drop in the result from the ongoing business. EBIT and net profit are anticipated to be significantly above the levels of the previous year due to the non-recurring profit contribution from the sale of real estate in Ingolstadt (Germany). The cost-cutting measures introduced have been implemented to a great extent.

Graf introduces at ShanghaiTex three novelties for the textile market: a new card clothing with up to 30% longer lifetime, a height adjustable comb and a helpful solution for card clothing management.
MULTISHARP, the unique wear resistant alloy for card clothings, increases the lifetime of metallic card clothings on the cylinder by up to 30%. Additionally, the work load of the maintenance team can be minimized by providing longer service cycles and less unplanned downtimes.

The yield on raw material can be increased without compromising the quality requirements – thanks to the continuous height adjustability of the new combs series. The continuous and exact gap setting between nipper and circular comb on each individual combing head provides customers a new level on raw material utilization. Additionally, the maintenance people will appreciate the comfortable and easy installation of the circular comb.

With the card clothing management the overall investment costs can be reduced. This is based on minimizing the operational expenses including optimizing the overall equipment effectiveness. Graf’s card clothing management prolongs the lifetime of flexible flats by up to three times without comprising on the quality parameters throughout the entire life cycle.

Shanghai - ROICA™ lands in Shanghai to showcase its complete range of premium stretch fibers for the modern wardrobe and disclose its visionary approach and strategy for a cutting-edge and sustainable fashion.

On show, leading material innovator Asahi Kasei introduces a premium stretch fiber starting from the ultimate ROICA Eco-Smart™ Family. The certified and multi-awarded range has astonished the textile world for its hyper-performative features. “The new premium stretch is synonymous of transformation: from standard to speciality, from basic to special, from ordinary to clever and from standard to Smart.” Explains Shinichiro Haga, Senior Executive Manager - ROICA™ Division.

Sustainability and a responsible approach are the true core of research and development to create high-tech engineered yarns.Such visionary imprint imbues all ROICA™ innovations:

• ROICA Eco-Smart™ family: A true world-first with the most contemporary sustainable range of responsibly produced premium ingredients. ROICA Eco-Smart™ family offers 2 sustainably designed stretch yarns

- ROICA™ EF is GRS by Textile Exchange certified, thanks to the fact that more than 50% of yarn content comes from the recycling of pre-consumer waste.
- ROICA™ V550 yarn got the Cradle-to-Cradle® Innovation Institute’s GOLD LEVEL Material Health certificate for impacts on human and environmental health. This yarn is also Hohenstein Environment Compatibility Certificated, signifying at its end-of-life, ROICA ™ yarn smartly breaks down without releasing harmful materials.

• ROICA Feel Good™ family: A unique range of advanced stretch yarns that deliver personal performance and measurable wellness, freshness and comfort metrics for travel, sport, leisure and more.
   
• ROICA Colour Perfect™ family: A range of yarns that can give excellent, flawless and world unique colour dimensions in advanced fit solutions.
   
• ROICA Resistance™ family: A high performance range of stretch solutions with performance resistance designed for match particular applications.
   
• ROICA Contour™ family: A range of yarns that create new shaping, stretch and silhouette solutions for a calibrated fit, effortless control, softness, comfort and support.

ROICA™ already entered the most advanced collections of leading brands as: Wolford for exceptional European Skinwear including legwear, Sarah Borghi for hosiery, SITA Active for Smart pret-a-porter,  Daquini for athleisure, Livy for sensual lingerie, SCOTT Racing Team for cycling uniforms, Closed for denim, Un-Sanctioned for running suits, Vitamine A for beachwear and many others.

In Shanghai, ROICA™ is set to stand out as leader in Smart Innovation. As tangible proof of this, the company brings to Intertextile Shanghai some of its ultimate collaborations across China and the Far East.

In addition to launching its new and expanded website, A. Monforts Textilmaschinen GmbH & Co. KG has issued two new publications celebrating the achievements of its major customers.

The first edition of Monforts World of European Textiles profiles a range of companies at the forefront of manufacturing in Europe serving a wide range of end-use markets – from high-end silk and polyamide fabrics for the luxury brands to nonwovens and technical textiles for digital printing, protective clothing, wallcoverings and more.

The seventh edition of Monforts World of Denim meanwhile charts the latest developments from the global market leaders in denim production. Monforts enjoys a global lead in the supply of finishing technology for the denim industry and is currently extremely busy responding to the interest shown at ITMA 2019 in its new CYD yarn dyeing system for this market.

Both publications are now available to download from the new website at: https://www.monforts.de/en/latest-news-media/downloads/

National Council of Textile Organizations (NCTO) President and CEO Kim Glas is testifying at a public hearing today in support of the administration’s efforts to crack down on China’s abuse of intellectual property rights through the use of the Section 301 mechanism, while also calling on the administration to include finished apparel and home furnishings in any retaliatory tariffs against China.

Glas is joining several other NCTO member companies today to testify at a U.S. Trade Representative hearing as part of the administration’s consideration of the Tranche 4 of retaliatory tariffs on U.S. imports from China.

Textile innovator Devan Chemicals will launch two new technologies at the upcoming Techtextil show in Frankfurt (May 14-17). Bio-flam, a bio-based flame retardant product and Odour Breakdown, a wash durable, non-biocidal odour control solution.
As tradition goes, every two years Devan participates in Techtextil, the leading international trade fair for technical textiles and nonwovens. In the quest for sustainability and transparency every company faces these days, the new Devan technologies offer answers to product developers and portfolio designers.

Bio-flam
Some facts & figures: There are at least 5000 fire incidents each day in the EU. Yearly, about 70 000 people are hospitalised with fire-related injuries. Fires cause pollution. So sustainable fire performance of products is an economic, environmental and human necessity. Take the example of mattresses: tests indicate that when on fire, non-FR treated products give less than 5 minutes escape time. Unfortunately, that is not enough time for the fire brigade to arrive. Needless to say that to increase escape time, to reduce the risk and to save lives, products need to be flame retardant. The challenge is to obtain flame retardant properties in the most natural way, to find the right balance between safety for the people and for the planet.

Companies can do this by replacing raw materials from a non-renewable source, by bio-based FR treatments, which are made from renewable sources and do not contain halogens or heavy metals, as described in the norm EN 16785 1:2015. Bio-based FR treatments, like Bio-flam, are made from renewable, vegetable sources and enable the FR treated products to be biodegradable. The active components are 100% halogen- and heavy metal-free. A welcome innovation for the bedding industry, as the European Commission requires mattresses to be recyclable by 2030 in order to reduce landfill.

Bio-flam P307 is the first introduction in the new Devan BIO-FR family, and is biodegradable and is developed to be used on 100% cotton or cotton/viscose mixtures, in order to create an ecological concept, safe for people and planet, whatever might happen. Bio-flam P 307 is developed for mattress ticking to pass EN 597 1&2. The Devan researchers are developing other bio-based products for other market segments and for other fire standards.

March 2019: For decades, Schoeller Textil has been meticulous in observing its responsibility to humans and the environment. Developed and produced in Switzerland under the most stringent conditions, the high-tech textiles and textile technologies encompass a spirit of innovative and outstanding quality. With a focus on sustainability, the groundbreaking, ecological portfolio includes, among other things, genuine upcycled products with ECONYL®-Garn, 100 % recycled, recyclable wear2wear woven and knitted fabrics or bio technologies based on sustainable raw materials.

High-quality textiles have a long service life and can remain in use for longer. The fabric properties are further improved by smart textile technologies such as water- and dirt-repelling functions. This helps preserve the environment and cuts down on the use of resources. In its manufacturing, Schoeller Textil AG always considers the ecological compatibility of its products. Therefore, since 2001, production at the Swiss site has always complied with the stringent guidelines of the bluesign® system. By conviction, Schoeller devotes itself to sustainable climate protection and takes part in the Energy Agency of the Swiss Private Sector programme to actively reduce carbon emissions and optimise energy efficiency.

• Challenging market environment due to low prices for standard viscose, less favorable exchange rates and higher raw material and energy prices
• Very positive development of specialty fiber business with revenue share exceeding 45 percent
• Dividend proposal of EUR 3.00/share plus a special dividend of EUR 2.00/share
• Results for 2019 expected at about the level of 2018 despite a significantly more demanding market environment

The Lenzing Group’s business developed well in the 2018 financial year. A significantly more challenging market environment led to a decline in revenue as well as earnings compared with the record results of the previous year. This was primarily caused by lower selling prices for standard viscose, exchange rate effects as well as higher raw material and energy costs.

Group revenue declined by 3.7 percent compared with the previous year to EUR 2.18 bn. The predicted challenging market environment for standard viscose, plus less favorable exchange rates and a slight decline in sales volume were the key contributing factors. EBITDA (earnings before interest, tax, depreciation and amortization) was down by 24 percent to EUR 382 million due to price increases for key raw materials and higher energy and personnel costs. The EBITDA margin dropped from 22.2 percent in the 2017 financial year to 17.6 percent in the reporting year. EBIT (earnings before interest and tax) fell by 36 percent to EUR 237.6 mn, leading to a lower EBIT margin of 10.9 percent (2017: 16.4 percent). Net profit for the year after one-off effects dropped by 47.4 percent from EUR 281.7 mn in the previous year to EUR 148.2 mn. Earnings per share equaled EUR 5.61 (2017: EUR 10.47).

The Management Board and the Supervisory Board will propose a stable dividend of EUR 3.00 per share plus a special dividend of EUR 2.00 per share at the upcoming Annual General Meeting. In total, the paid dividend will amount to EUR 5.00 per share, corresponding to a dividend payment to shareholders of roughly EUR 133 mn.

Archroma, a global leader in color and specialty chemicals towards sustainable solutions, today announced that Thailand-based Absolute Denim will be the first denim manufacturer to switch 100% of its production to aniline-free* indigo dyeing.

Absolute Denim is a Thailand-based denim manufacturer producing high quality denim with a focus on eco-friendlier materials and processes. The company can produce up to 2 million meters of denim per month (that's approximately 1.5 million pairs of jeans!), for customers that include some of the biggest brands and retailers in the world.

Archroma’s Denisol® Pure Indigo 30 liquid dye was first launched in May 2018 as a non-toxic way to produce the traditional, iconic indigo blue that consumers associate with denim and jeans.

During production, some of the aniline stays locked into the indigo pigment and is difficult to wash off the fabric. The remainder of the aniline impurity, approximately 300 metric tons annually, is discharged during dyeing. This can be an issue as aniline is toxic to aquatic life. In addition, exposure levels to factory workers can be high. As a result of its toxicity (more hazardous than alkylphenols) it is now starting to feature on the restricted substance lists (RSL) of some major clothing brands and retailers.

The new Denisol® Pure Indigo 30 liq was therefore developed as an aniline-free* indigo solution for designers, manufacturers and brand owners who long for authentic indigo inspiration.

Archroma tested Denisol® Pure Indigo at Absolute Denim mill in Thailand. Archroma wanted to be sure that the new indigo dye would perform exactly the same as conventional indigo.

James Carnahan, Head of Sustainability at Archroma, comments: “At Archroma we continuously challenge the status quo in the deep belief that we can make our industry sustainable - but we cannot do it alone. Without forward-thinking manufacturers such as Absolute Denim to consciously adopt these eco-advanced innovations in their daily production, like our aniline-free* Denisol® Pure Indigo, we will not be able to move this industry forward on our resource-constrained world we live in. As consumers are increasingly aware of, and concerned about, climate change and ecological threats, this is not only the right thing to do - it is also good for business.”

“Deep down inside most of us want the world to be a better place for our loved ones and for future generations,” insists Vichai Phromvanich, Board Member, Absolute Denim, “starting with how we live, what we eat, what we wear, still trying to be cool, fashionable, still trying to be environmentally conscious. Archroma’s aniline free indigo project is therefore something we as a new generation manufacturer have supported from the beginning, by opening our doors for tests in the project phase, and now by sending out our articles to many of our customers. For us, after all, a nice pair of jeans looks even nicer without aniline!”

* Below limits of detection