Preliminary forecasts of results for the first quarter of 2016

The current year started very optimistically. Good business conditions persisted on both on the Polish market and foreign markets served by the Group’s companies. This was reflected in both projected sales growth rate and generated margins. The Management Board estimates the highest growth rate in the first quarter will be recorded by the Building Services Segment (ca. 60%) and the Aluminium Systems Segment (ca. 30%). The Flexible Packaging Segment will increase its sales by ca. 15% and the Building Accessories Segment by ca. 5%. The Extruded Products Segment will record sales comparable to last year’s figure; however, in the case of this segment, it should be highlighted that aluminium prices on global markets fell by more than 15% as compared to the corresponding period in the previous year. A portion of this decline was set-off by the rising USD exchange rate; however, when this factor is taken into account, the drop in aluminium prices in PLN amounted, in the first quarter, to ca. 10%. Hence, the generation by the Extruded Products Segment of the sales comparable to last year’s figure means that the real growth was at the level of ca. 10% (taking into account the decline in raw material prices). Consolidated sales revenue will amount to ca. 505 million PLN, i.e. it will be higher by ca. 8% than the last year’s figure.

According to the Management Board’s estimates, consolidated operating profit for the first quarter will increase by 20% as compared to the last year’s figure and will amount to ca. 63 million PLN; while EBITDA (operating profit before depreciation and amortisation) will amount to 88 million PLN (also an increase by ca. 20%). The balance of financing activities in the quarter (costs of interest, exchange rate differences on balance sheet items valuation, including foreign currency loans) will be negative and amount to ca. 3.5 million PLN (in the first quarter of 2015, the balance amounted to -13.2 million PLN). The Company projects that consolidated net profit for the quarter will amount to ca. 50 million PLN, i.e. it will be higher by 40% than the figure for the first quarter of 2015. According to estimates, at the end of March 2016, net debt of the Capital Group will amount to 280 million PLN.

The above forecast was prepared on the basis of the following assumptions.