PORTUGAL – Consolidated sales of Sonae Industria reached 220.2 million euros in 2018, a reduction of 10.8 million euros (-4.7%) vs. 2017, driven by lower sales volumes in the Laminates and Components business (particularly to the Nordic markets) and by the depreciation of the Canadian Dollar vs. the Euro, leading to a reduction of sales in euros from their North American business, despite the increase in local currency sales.

For the fourth quarter, Consolidated Turnover reached 51.3 million euros, a reduction of 0.9 million euros vs. 4Q-2017. In Canada, sales volumes in 4Q-201818 were materially lower (-7.4%) than in 4Q17, affected by a shortfall in production volumes that prevented the maximization of sales in this period.

In November, a fire in the larger of the two particleboard lines of Tafisa Canada, immediately after the annual maintenance shutdown of that line, implied an additional production stoppage of almost two weeks.

Recurrent EBITDA in 2018 reached 26.7 million euros, a reduction of 11.4 million euros vs. 2017. The lower recurrent EBITDA as compared to the previous year, is mainly explained by the reduction in turnover and particularly by the increase in variable costs. The recurrent EBITDA margin in 2018 reached 12.1%, down by 4.4 p.p. vs. 2017.

On a quarterly basis, recurrent EBITDA for the 4Q18 stood at 4.0 million euros, with 7.8% recurrent EBITDA margin. The negative evolution in the quarter is mostly explained by the performance of their North American business that, despite having registered in October the best month of production and EBITDA result of 2018, was negatively affected in terms of production volumes and maintenance costs as previously mentioned.

Net results in 2018 were 11.0 million euros positive, a reduction of 4.2 million euros when compared to 2017, mainly explained by the aforementioned reduction in EBITDA, which more than offset the positive variations in Provisions and Impairment Losses and in Gains and losses in Joint-Ventures (aggregate Net Results and Other).