* Swings to Q4 net loss of 38 mln eur
* Dividend steady at 0.75 eur/shr
* Shares up 1.3 pct
(Releads on CEO's Norway comments)
By Alexandra Schwarz-Goerlich and Georgina Prodhan
VIENNA, Feb 25 Austrian fireproof materials
maker RHI is confident it can make profitable within
two years a Norwegian plant whose troubles cut into the
company's full-year results.
Chief Executive Franz Strutzl said on Tuesday the idea of
shutting down the magnesia-fusion plant was now off the table,
as major technical problems had been resolved, although work
remained to be done to reduce production costs.
"We are sure that we will have solved the problems on the
cost side within two years," he told a news conference after the
company reported weaker than expected quarterly results.
RHI shares turned positive on this news and were trading 1.3
percent higher at 23.90 euros by 1402 GMT, outperforming a
1.5-percent weaker European basic resources index.
The company proposed keeping its 2013 dividend steady at
0.75 euro per share, and reiterated its 2014 guidance for a rise
of about 3 percent in revenues and an operating margin of 8 to 9
The Norwegian plant, the first of its kind in Europe, was
designed to wean RHI off its dependence on Chinese raw-materials
producers, but suffered technical problems from the outset.
RHI wrote down the plant by 65 million euros ($89 million)
last year and took a hit of more than 30 million euros to its
For the fourth quarter, RHI swung to a net loss of 38
million euros, worse than the average forecast loss of 31
million euros in a Reuters poll.
On top of the Norway impairment, it also booked
restructuring charges of 25 million euros for closing a plant in
Duisburg, Germany that produced magnesia-carbon bricks for the
steel industry, from which RHI makes most of its sales.
RHI is experiencing weak demand from steelmakers, who are
battling a European construction slump as governments cut back
on spending. The company also reported low demand from the glass
and environment, energy and chemicals sectors.
Quarterly sales slipped 1 percent to 457 million euros.
Strutzl forecast a slight improvement for the European steel
industry. "I am cautiously optimistic. I don't expect any more
capacity reductions but demand will stay level in 2014 and also
in 2015," he said.
($1 = 0.7285 euros)
(Editing by Mark Heinrich)