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voestalpine Sales, Earnings Increase During Q1 2010/11
08/20/2010 - voestalpine’s revenue went up by 22.1% from EUR 2,093.2 million for last year’s first quarter to EUR 2,556.1 million for the first quarter of 2010/11. The operating result (EBIT) increased by about EUR 230 million—from EUR -26.3 million to EUR 203.3 million.
Due to a steep increase in sales volumes in all divisions, voestalpine’s revenue went up by 22.1% from EUR 2,093.2 million for last year’s first quarter to EUR 2,556.1 million for the first quarter of 2010/11.
The operating result (EBIT) increased by about EUR 230 million—from EUR -26.3 million to EUR 203.3 million, due to a further improved price level and to the ongoing efficiency improvement programs.
Compared to the immediately preceding quarter (fourth quarter of 2009/10), EBIT rose in the first quarter of 2010/11 by 15.0% from EUR 176.8 million to EUR 203.3 million.
Dr. Wolfgang Eder, Chairman of the Management Board and CEO of voestalpine AG, said, ”Despite continuing doubts regarding a comprehensive global recovery, since early 2010, the industrial environment in most economic regions has been characterized by an unexpected momentum. From today’s perspective, we can assume that the operating result of the business year 2010/11 will substantially exceed that of the previous year, aided by the efficiency improvement programs currently being implemented.”
The voestalpine Group recorded higher figures vis-à-vis the immediately preceding quarter for the fourth consecutive time. It was able to boost its revenue of EUR 2,261.7 million from the preceding quarter (Q4 2009/10) by an additional 13.0%.
Compared to Q1 2009/10, the rise in revenue resulted in EBITDA that went from EUR 134.2 million to EUR 350.9 million, representing an increase of 161.5%; this means a Group margin in the first quarter of 2010/11 of 13.7% (previous year was 6.4%).
The gain of EUR 100.6 million—from EUR 34.0 million to EUR 134.6 million (in absolute figures)—means that the Steel Division was able to improve EBITDA almost fourfold. The Special Steel and Profilform Divisions boosted EBITDA most markedly from EUR 4.7 million to EUR 77.1 million and from EUR 7.1 million to EUR 39.1 million, respectively.
Compared to Q1 2009/10, the rise in revenue resulted in EBITDA that went from EUR 134.2 million to EUR 350.9 million, representing an increase of 161.5%; this means a Group margin in the first quarter of 2010/11 of 13.7% (previous year was 6.4%).
The gain of EUR 100.6 million—from EUR 34.0 million to EUR 134.6 million (in absolute figures)—means that the Steel Division was able to improve EBITDA almost fourfold. The Special Steel and Profilform Divisions boosted EBITDA most markedly from EUR 4.7 million to EUR 77.1 million and from EUR 7.1 million to EUR 39.1 million, respectively.
The Automotive Division’s EBITDA also more than doubled from EUR 12.7 million to EUR 26.4 million.
The Group’s crude steel production in the first quarter of 2010/11 was 1.96 million tonnes, 54.3% higher than the previous year’s corresponding figure (1.27 million tonnes). At 1.36 million tonnes, the Steel Division reported a 47.8% growth in production. The Special Steel Division more than doubled its production from 90,000 tonnes to 210,000 tonnes.
Capacity utilization in all five divisions is closing in on the pre-crisis level, and the positive trend relative to operating results continues, voestalpine noted. Since early 2010, the industrial environment in the major economic regions has been characterized by an unexpected momentum. From today’s perspective, this means full capacity utilization in the Steel and Railway Systems Divisions and a capacity utilization of about 90% in the Special Steel, Profilform, and Automotive Divisions for the second half of the 2010 calendar year.
Outlook—The development of the Group’s operating result is still somewhat different than prior to the crisis. This is due to the comprehensive structural changes in the pricing of coal and ore—the shift from annual to quarterly prices—as well as a sudden, unanticipated doubling of the ore prices in April and another significant increase as of June of this year.
The Group’s crude steel production in the first quarter of 2010/11 was 1.96 million tonnes, 54.3% higher than the previous year’s corresponding figure (1.27 million tonnes). At 1.36 million tonnes, the Steel Division reported a 47.8% growth in production. The Special Steel Division more than doubled its production from 90,000 tonnes to 210,000 tonnes.
Capacity utilization in all five divisions is closing in on the pre-crisis level, and the positive trend relative to operating results continues, voestalpine noted. Since early 2010, the industrial environment in the major economic regions has been characterized by an unexpected momentum. From today’s perspective, this means full capacity utilization in the Steel and Railway Systems Divisions and a capacity utilization of about 90% in the Special Steel, Profilform, and Automotive Divisions for the second half of the 2010 calendar year.
Outlook—The development of the Group’s operating result is still somewhat different than prior to the crisis. This is due to the comprehensive structural changes in the pricing of coal and ore—the shift from annual to quarterly prices—as well as a sudden, unanticipated doubling of the ore prices in April and another significant increase as of June of this year.
Price adjustments across the entire value chain are only possible with a certain delay, as the voestalpine Group’s business model is largely characterized by more long-term agreements and projects, the company noted. These price adjustments will be largely completed during the course of the second quarter of 2010/11.
At the same time, the prices for ore and coal for the rest of 2010, measured against the summer months, will be trending down rather than up. Concurrently, considering the broadly based demand from all major customer industries with the exception of the construction industry, the current seasonal weakening of prices on the spot market in most of the European countries should be reversed during the course of the rest of the year due to the economic climate.
At the same time, the prices for ore and coal for the rest of 2010, measured against the summer months, will be trending down rather than up. Concurrently, considering the broadly based demand from all major customer industries with the exception of the construction industry, the current seasonal weakening of prices on the spot market in most of the European countries should be reversed during the course of the rest of the year due to the economic climate.
From the manufacturers’ vantage point, it is expected that the noncritical inventory situation and a continuing low European import quota will support this development. Against this backdrop—even taking into consideration the still significant uncertainties regarding the development of the economic situation during the last quarter of the business year—the Group can assume that the operating result of the business year 2010/11 will substantially exceed last year’s EBIT (EUR 352 million).
voestalpine is a leader in customized high-quality and high-tech steel products and solutions. The Group is represented worldwide by more than 360 production and sales companies in more than 60 countries. With its highest quality flat steel products, voestalpine is one of the leading European partners of the automobile, white goods, and energy industries.
voestalpine is a leader in customized high-quality and high-tech steel products and solutions. The Group is represented worldwide by more than 360 production and sales companies in more than 60 countries. With its highest quality flat steel products, voestalpine is one of the leading European partners of the automobile, white goods, and energy industries.
