If you use this site, you agree to our use of cookies. More information

Market environment
and business development

For the Special Steel Division, the already challenging economic environment in the first three months of this business year continued in the second quarter of 2013/14. The customary seasonal effects in the summer months, which were more pronounced than in the previous year, particularly in Europe and North America, were an additional negative factor. The result was increasing price pressure, as the competition had unutilized capacity. The concurrently falling prices for scrap and key alloys encouraged customers to reduce their orders to an absolute minimum in expectation of lower prices.

In terms of regional aspects with regard to demand, European core markets did not improve compared to the first quarter. Compared to the previous year, demand in Germany and Austria was at an even lower level and the markets in Southern Europe showed only vague recovery tendencies. In North America, the situation was characterized by volatile developments in the USA and stagnation in Canada. Subdued consumer sentiment and sparse investment activities, especially in oil and natural gas exploration in Brazil, not only affected the Brazilian market but also had a negative impact on the economies of the neighboring countries. Ongoing devaluation of the Brazilian currency, however, could provide assistance for Brazil’s exports in the coming months.

Despite a lackluster economic environment in Asia, gains in market share resulted in a stable development, and some economic improvement seems to be on the horizon for China and Japan.

In the High Performance Metals business segment, low inventories of the customers of the tool steel and high-speed steel segments had a positive effect on business development in the first half of 2013/14, with premium products experiencing increased demand. The situation for special structural steel and open-die forgings was quite different. In these segments, the sluggish energy and mechanical engineering industries had an adverse impact on earnings. Demand for special materials was stable at a solid level primarily because this segment profited from the positive development of the aviation industry and oil and natural gas exploration. In the consumer goods industry, growth signals are coming primarily from Asia and are limited to white goods, electronics, and packaging.

Capacity utilization in the production companies fluctuated dramatically in recent months due to customers’ short-term order patterns; however, overall, it was at a satisfactory level. Integration of the sales and service units acquired in the spring is on schedule. These strategic acquisitions enabled the High Performance Metals business segment to significantly expand its range of products and services, especially with regard to high- quality coatings as well as mechanical processing and heat treatment of sophisticated special steels.

Demand in the Special Forgings business segment continues to be inconsistent. Special steel forgings experienced a significant boost due to the momentum of the aerospace sector and a slight recovery of the commercial vehicle industry. Demand in the energy engineering industry was stagnant at a low level in this segment as well, with no signals pointing to an economic recovery. Due to the postponement of projects planned for the second half of the current business year, the hoped-for uptrend in this sector seems improbable.

to pagetop
  • Share price as of September 30, 2013 (euros) 35.35    EPS – Earnings/share (euros) 0.47    Dividend/share (euros) 0.90
  • Ad-Hoc NewsInvestor Relations
Close