Investments

Since numerous ongoing large-scale projects of the voestalpine Group were progressing successfully in the business year 2015/16 and the investment volume had reached an absolute peak with EUR 1,310.9 million during that time, many of these projects entered the start-up phase in the course of the business year 2016/17. Against this backdrop, the investment expenditures of EUR 1,011.4 million in the past business year were 22.8% below the previous year’s figure, but still considerably higher than the level of depreciation.

Since the major portion of the investment volume had already been allocated for the largest and most modern direct reduction plant in Corpus Christi, Texas, USA, over the past business years, the investment expenditures in the Steel Division dropped by 41.8% from EUR 701.1 million in the previous year to EUR 408.1 million in the business year 2016/17. After a construction period of two and a half years, this facility was successfully completed in the fall of 2016. Following the run-up phase of almost six months, the plant went into full operation on April 1, 2017 (see Chapter “Direct reduction plant Texas, USA”). In addition, the Steel Division successfully continued or implemented several other strategically important investments in the business year 2016/17. For example, in the Heavy Plate segment the “toughcore^®” plant developed in-house was put into operation in the third quarter of 2016/17. This technology provides unique product features in challenging environments, such as very low temperature conditions or extreme water depths. For the continuous casting facility 8 investment project, with aims to further optimize the portfolio of the strip segment, the processing system was installed in the previous business year and cold tests were started according to plan in the spring of 2017. Commissioning is scheduled for the fall of 2017. Thanks to the excellent cooperation of all project partners, the major repair of the blast furnace 6 was completed ahead of schedule between July and November 2016. Concurrently, preparatory measures for the major repair of the large blast furnace A scheduled for 2018 have started.

The investment expenditures in the High Performance Metals Division (formerly Special Steel Division) of EUR 179.5 million in the business year 2016/17 are only marginally below those of the previous year (EUR 181.7 million) and primarily focused on strategic growth areas: For example, the revenue in the technologically challenging aerospace customer segment is to be almost doubled in the coming years. In light of the above, the Böhler Schmiedetechnik GmbH & Co KG is currently investing in a new high-tech fast forging line at the Kapfenberg facility in Austria, which is scheduled to begin operation at the end of calendar year 2018. The plant will primarily produce pre-material for extremely stress-resilient aircraft components (e. g., engine parts) as well as sophisticated forged parts for oil and gas exploration. Furthermore, with the construction of a production line for structural aircraft parts, the leading manufacturer of special forgings made from high-performance metals meets the needs of the booming aerospace industry. This fully automated plant will be commissioned in 2019. The activities at the Mürzzuschlag site in Austria currently focus on the construction of a straightening plant for titanium plates that are used in the aerospace industry, as well as in mechanical engineering and the chemical industry. At the two production sites in Kapfenberg, Austria, and Hagfors, Sweden, investments are still focused on power units for the production of powder metal made from steel and nickel-based alloys to be used in the additive manufacturing segment. Additive manufacturing centers for the production of metal components by 3D printing were constructed in Düsseldorf, Germany, and in Singapore in the business year 2016/17. In the Value Added Services business segment, the expansion of the plant capacities for heat treatment and machine processing in Chengdu, the economic center in southwestern China, as well as in Querétaro, the automotive hotspot in Mexico, was further advanced in the business year 2016/17.

In the Metal Engineering Division, the investment volume of EUR 211.0 million for the business year 2016/17 fell by 16.7% below the value of EUR 253.3 million from the previous year. The division’s currently largest single investment in a new digitalized wire rod mill constitutes a technological benchmark to sustainably increase the performance, flexibility, and quality of the rolled wire production at the Leoben/Donawitz location in Austria. In the Seamless Tubes business segment, strategically vital future-oriented projects are being consequently implemented, despite the current market weakness. For example, the expansion of dimensions at the Kindberg location in Austria was successfully completed during the business year 2016/17. Installations for additional heat treatment capacities began in September 2016, making the commissioning in the first quarter of 2017/18 sufficiently certain.

The major portion of the investment volume in the Metal Forming Division that increased by 22.4% over the previous year from EUR 167.5 million to EUR 205.1 million was again allocated to strategically implement global roll-outs of key technologies in the automotive segment based on long-term contracts. For the local production of ultra high-strength automotive components, particularly for German premium brand automakers, the plant in Cartersville, USA, already started its third “phs” expansion phase in 2016. With Lanfang near Bejing, a new location was added in China to fulfill an ongoing order for the automotive industry spanning over several years. The dynamic growth in the automotive segment in Mexico will be met with the construction of a new production facility for high-quality automotive components in Aguascalientes, Mexico. In addition, important strategic initiatives were set at European locations as well. In this regard, a notable highlight is the startup of operations of the first facility worldwide for “phs-directform^®” in Schwäbisch Gmünd, Germany, in the second quarter of the business year 2016/17. With this innovation, this plant will be the first to produce press-hardened, ultra high-strength and corrosion-resistant automotive body parts from galvanized steel strip in one single process step. Another highlight for the Automotive Components business segment was the opening of what is now the largest production facility worldwide for laser-welded blanks in Linz, Austria, in the summer of 2016 after only just over a year of construction.