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ePaper created 2015-05-06, 08:22:31 | version 1.38.0
32 Price trends in precious metal markets have a major effect on revenues in many Heraeus business groups. Ongoing price volatility in precious metal trading and uncertainty about the general health of several major economies once again make it difficult to make precise revenue forecasts for the coming years. From 2015, Heraeus will therefore focus its key performance indicators on revenue excluding precious metals and on earnings before interest and tax. Going forward, product revenue will no longer be a primary measurement of financial performance. In 2015, Heraeus expects to see a slight upturn in the economy. Lower energy prices and the depreciation of the euro point to a moderate recovery in the eurozone; however, the vulnerability of the eurozone as a result of the sovereign debt crisis remains a risk. The slowdown in China’s economy could also impact negatively on revenue growth in individual markets. Low interest rates and falling commodity prices, in par- ticular for oil, are expected to continue to boost momen- tum in the global economy. These effects and increased spending by companies and households could boost the US economy. Slight economic growth is therefore antici- pated for 2015 as a whole. Heraeus expects to achieve stable year-on-year growth in 2015, with a slight increase in revenue excluding precious metals. Adjusted for currency effects, revenue excluding precious metals is projected to be on a par with the 2014 level. Earnings before interest and tax (EBIT) for 2014 took a substantial hit from the effects of foreign currency valuation and other one-off items. Heraeus expects EBIT generated in 2015 by the operational business groups to match the previous year’s level when adjusted for these items. Overall, Group earnings before interest and tax is predicted to significantly exceed the level achieved last year. This is because earnings should no longer be affected by these one-off items. Innovations in attractive markets, such as the medical equipment market, are driving forward organic growth. The reorganization of the Group, in which the Precious Metals and Materials Technology business groups are being split up into seven new global business units, is expected to yield an initial positive impact on revenue and earnings in the second half of 2015. In 2014, fur- ther progress was made with ongoing projects to raise efficiency in various parts of the business. Particularly in the area of operational excellence, there is further room for improvement that will be continue to be worked on in 2015. As things stand, is it not yet possible to fully pre- dict the extent to which this will affect earnings in 2015. Trading in precious metals is influenced by the global eco- nomic situation. The volatile economic environment, vary ing by region, may temporarily further reduce demand in the industrial sector. On the other hand, investors are likely to remain interested in precious metals, especially gold. In 2015, demand for products containing precious metals is forecast to recover, with much of the growth again coming from Asia. The expansion of the product portfolio in China aims to bolster this growth in the medium term. Outlook