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Message from the Chairman and the CEO

Dear Reader,

From a financial performance perspective, 2018 was deeply disappointing. The results we posted in 2018 dropped far beyond our goals and reversed our successful margin improvement trend of the past years. Despite softening GDP growth in 2018, induced by trade tensions and other political and economic uncertainties, we achieved 5% consolidated sales growth and our combined sales exceeded the € 5 billion mark for the first time in history. 

We haven’t been able, though, to translate this growth into incremental profit. Underlying EBIT reached € 210 million, representing a margin on sales of 4.9%, and reported EBIT was € 147 million at a margin of 3.4%, far below the levels of previous years. We are addressing all business elements that are within our control to rebuild our financial performance sustainably, so we can continue to pursue our growth strategy.

We recognize that our commitment to drive value creation for our stakeholders has to take into account the broader economic, environmental and social impacts of our operations. We therefore consider the interests of customers, suppliers, employees, shareholders, communities and other stakeholders in all aspects of our operations. We want to conduct and grow our business in a sustainable way so that our stakeholders all benefit.

Our company generates economic value through employment, capital investments, dividends, and payments to capital providers and governments. We co-operate with customers and suppliers to develop products and processes that contribute to a cleaner environment. We interact with local governments in a transparent and constructive way and we strive to be a loyal and responsible partner in the communities where we are active. 

Bekaert has a strong track record of success and we want to return our business performance as quickly as possible to the positive growth path that we set out in our strategy and that we have been achieving until recently. We are confident that our accelerated transformation drive and the improvement actions we are taking, will help us rebuild the underlying EBIT margin to above 7% over the medium term.

Our Company Values distinguish us and guide our actions. We conduct business in a socially responsible and ethical way. We have translated our sustainability ambitions into clear targets so we make a positive contribution to our employees, to the environment, and to society as a whole.

We want to thank our customers, partners and shareholders for their continued trust. And we want to thank our employees for their commitment and drive to take on the new challenges and realize our goals.

Matthew Taylor and Bert De Graeve
 
Bert De Graeve, Chairman        -        Matthew Taylor, CEO

(GRI 102-14)