According to consolidated financial data, in 2019, the FAMUR Group achieved a net profit of approx. PLN 249 million. The Group's sales revenue amounted to approx. PLN 2,165 million, while generated EBITDA was approx. PLN 451 million. In light of the COVID-19 pandemic, the Management Board of FAMUR SA decided to strengthen the Group's financial position and deemed it justified to recommend that the entire profit for 2019 be retained, and at the same time maintained the adopted dividend policy.
Revenue from domestic market was PLN 1,359 million, accounting for 62.8% of total revenue, while export sales increased in 2019 by 11%, reaching the level of PLN 806 million, which constitutes 37.2% of total revenue, compared to 33% generated in 2018. Russia and the CIS countries continue to hold the largest share in foreign sales and in 2019 generated PLN 524 million in revenue.
Consolidated net result of the FAMUR Group for 2019 was affected by one-off events, including in a positive manner due to sale of Przedsiębiorstwo Budowy Szybów and in a negative manner due to recognition of risks and write-down of goodwill in the Surface segment (the Famak Group).
The Underground segment, which accounts for 75% of the Group's revenue, generated revenue of PLN 1,621 million, an increase of 15% compared to 2018. The Surface segment generated PLN 256 million in revenue, i.e. PLN 115 million less than in 2018, which stemmed from materialisation of risks related to performed long-term contracts and suspension or abandonment of new investments, especially in the open-pit mining sector. The Electricity segment generated PLN 150 million in revenue, which was similar to the previous year, while the Mining Services segment, due to sale and deconsolidation of Przedsiębiorstwo Budowy Szybów, ended 2019 at PLN 138 million.
"Financial results for 2019 show that the FAMUR Group, due to increased activity, especially on foreign markets, as well as continuous work on optimization of its operating model and cost structure, was able to make effective use of the favourable market environment in the mining industry. This is especially visible in results achieved by underground mining segments, where revenue increased by 15% year-over-year," said Mirosław Bendzera, President of FAMUR SA.
In light of the global COVID-19 coronavirus pandemic and the inability to assess its ultimate effect on the global economy, domestic market and the Group's situation, the Management Board of FAMUR SA deemed it justified to recommend that the entire profit for 2019 be retained in order to strengthen the Group's financial position. Given the current dynamics of market changes and the impact of the COVID-19 pandemic on the global economy, business situation of the FAMUR Group can be expected to deteriorate in subsequent quarters of 2020.
Retention of the entire profit will allow to secure financing for possible acquisition projects which will enable significant diversification of the Group's revenue should entities attractive in terms of sector and finance appear.
At the same time, the Management Board maintained the adopted divided policy, which assumes recommendation of payment of dividends to shareholders at 50% to 100% of net profit in the absence of significant acquisitions or material changes in market situation.
With respect to strategic goals for 2019–2023, FAMUR continues the process of diversification of its business areas. Key strategic goals also include maintaining the position of domestic market leader, reaching 50% share of exports in revenue by 2023 and 25% share of aftermarket in revenue.