Report on the financial key performance indicators of the voestalpine Group

At EUR 3,251.5 million, the revenue of the voestalpine Group in the first quarter of 2017/18 exceeded the number for the first quarter of 2016/17 (EUR 2,772.4 million) by 17.3%. While all four divisions succeeded in boosting their revenue, at an increase of more than one third the Steel Division posted the highest growth. This was due not just to the higher price level year over year, but also to the fact that, in contrast to the same period the previous year, the Steel Division’s revenue in the first quarter of 2017/18 also included the deliveries of sponge iron (HBI) to external customers. The Group segments that depend strongly on developments in the oil and gas sector—particularly Heavy Plate (Steel Division) and Seamless Tubes (Metal Engineering Division)—also succeeded in boosting their revenue in the wake of the energy sector’s recovery.

In the first quarter of 2017/18, the voestalpine Group posted a year-over-year increase in all earnings items that surpassed its revenue growth by far. The operating result (EBITDA) rose by 53.9% from EUR 333.9 million (margin: 12.0%) to EUR 513.8 million (margin: 15.8%). In a comparison across divisions, the Steel Division also posted by far the highest growth in earnings thanks to a massive increase or even a multiplication in all categories. While the division’s gross margin had come under pressure the previous year due to the delay in passing price increases in raw materials that had already taken place on to customers in the contract business, this year it succeeded in profiting from marked price increases that were accompanied by moderate developments in the cost of raw materials. Driven above all by this positive development in the steel business, year over year the voestalpine Group’s profit from operations (EBIT) improved by a total of 96.2% from EUR 167.6 million to EUR 328.8 million. As a result, at 10.1% (previous year: 6.0%), the Group posted a double-digit EBIT margin. In a year-over-year comparison, the voestalpine Group even more than doubled its numbers in the categories “profit before tax” (increase from EUR 138.9 million to EUR 292.4 million) and “profit after tax” (increase from EUR 105.8 million to EUR 218.4 million).

The increase in the net financial debt as of June 30, 2017, to EUR 3,347.2 million compared to both the March 31, 2017, reporting date (EUR 3,221.1 million) and June 30, 2016 (EUR 3,188.9 million) stems primarily from increased working capital commitments—among other things due to the build-up of inventories for the major repairs of the large blast furnace in the Steel Division that must be carried out in the next business year. The fact that at 53.8%, the gearing ratio (net financial debt relative to equity) as of June 30, 2017, declined nonetheless compared to the previous year (55.9% as of June 30, 2016) and remained largely unchanged compared with the March 31, 2017, reporting date is due above all to the excellent earnings growth in the first quarter of 2017/18 and the resulting rise in equity to a new high of EUR 6,220.8 million as of June 30, 2017 (compared with EUR 6,060.3 million as of the 2016/17 reporting date and EUR 5,705.3 million as of June 30, 2016).

As of June 30, 2017, the voestalpine Group had 50,047 employees (FTE), which means that it crossed the threshold of 50,000 for the first time. Compared with the level as of June 30, 2016 (48,319), this represents an increase of 3.6%, which is due primarily to the expansion of the Group’s automotive activities at its international sites as well as the expansion of the oil and gas sector, which is driven by economic factors.

Net financial debt can be broken down as follows: