Demand in the downstream sectors of the Metal Engineering Division remained at its customary high level and characterized the first nine months of 2014/15. Based on this very good demand situation, capacity at the division’s steel base in Donawitz, Austria, was fully utilized.
In the first three quarters of 2014/15, the Rail Technology business segment faced changing framework conditions. After years of below average investment in European railway infrastructure, both as far as new projects and maintenance are concerned, 2014/15 saw a broadly based increase in demand in Europe, while at the same time, the international markets, which had been booming in the recent past, weakened. The revitalization of the European markets ensures ongoing high capacity utilization of rail production, although, most recently, it was not possible to maintain the high price level of previous years. As a result of the continuing positive order situation, rail production in the coming business year will be expanded from a three-shift to a four-shift operation for the first time.
The global positioning of the Turnout Systems business segment and the sophisticated, technical system solutions it provides ensure the segment’s excellent performance. Once again, its global orientation has proven to be invaluable in the current business year, as the business segment profited particularly from the dynamic development in North America. However, Europe, Asia, and India also contributed positive impulses. While mining projects declined, the mass transit sector saw an increase in orders due to the recent acquisition of the Bathurst Rail Fabrication Center (see the “Acquisition” section), market leadership in the turnout segment in Australia continued to be expanded.
In the first three quarters of 2014/15, the Wire Technology business segment profited from the solid situation of the automobile industry and the resulting demand for both drawn wire and rolled wire. In contrast, demand in the oil and natural gas sectors declined in the course of the year. However, as the sentiment in the European automobile industry, the most important customer of the Wire Technology business segment, continues to be positive, a continuation of the stable development can be anticipated for the coming quarters.
Despite a rapid deterioration of the oil price in the past months, the solid level of orders in the Seamless Tube business segment has guaranteed almost full capacity utilization of production thus far. The dramatic decrease in oil exploration activities due to the current oversupply of oil is, however, expected to have an impact on capacity utilization in the production of seamless tubes in the business year 2015/16.
The Welding Technology business segment has been facing diminished demand in Germany, primarily due to weakening in demand in the mechanical and plant engineering sectors, resulting in part from the sharp drop in exports to Russia. While the trend on the Brazilian market in the welding consumables segment was weaker, market conditions in this segment trended stronger in North America, India, and Southeast Asia.