At EUR 776.7 million, the voestalpine Group’s investment volume in the business year 2019/20 was lower than in previous years. This was the first time since the business year 2011/12 that its investments were less than depreciation. Numerous cutting-edge projects were successfully implemented in recent years. As the consolidation phase has already started, the task at hand now is to optimize these state-of-the-art facilities in daily operations, taking technical and economic perspectives into account. The Group’s investment activities will be scaled back yet further in the current business year 2020/21 against the backdrop of the tight financial situation related to COVID-19.
The decline in the Steel Division’s project activity is particularly pronounced. The comprehensive overhaul of Blast Furnace A at the division’s facilities in Linz, Austria, over the summer of 2018 marked the successful completion for the time being of its larger projects. As a result, the division’s investment volume dropped by 53.0%, from EUR 322.7 million in the previous year to EUR 151.6 million in the reporting period. November 2019 saw the successful start-up of the Linz electrolyzer plant, which serves to explore CO2-free production of hydrogen. This pilot plant, which was built with partners such as Verbund AG (Austria’s leading utility) and Siemens, conducts research on the production of “green” hydrogen, an input material expected to replace fossil fuels in steelmaking. In the business year 2019/20, the Steel Division invested in a new cold-rolled strip testing center among other things. Developments in innovative, ultra-high strength steel grades give rise to new requirements regarding analyses of mechanical product properties. The construction of a new straightening machine was the most important project in the division’s heavy plate product segment. The new facility, which was brought online at the start of the business year 2020/21, will improve the product quality of clad plates for highest requirements.
At EUR 259.1 million, the investment volume of the High Performance Metals Division in the business year 2019/20 was 7.4% higher than the volume (EUR 241.2 million) in the previous business year. Construction of the fully digitalized special steel plant, which has a capital spending budget of EUR 350 million, was launched at the start of the reporting period. Preparations at the construction site, including the work on the infrastructure for subcontractors, had already taken place a year earlier. The foundations as well as the steel mill production floor were built in the business year ended, and specialized companies were busy installing the energy delivery system as well as the piping systems. While the construction continued in the fourth quarter of the business year 2019/20 despite the spread of the COVID-19 pandemic, albeit subject to restrictions, delivery bottlenecks delayed the progress of the work by a few weeks. Both the completion of the facility and the initial phase of the start-up are slated for the second half of calendar year 2021. Once the certification processes have been completed, the division will be able to supply high-performance steels to international customers in the aerospace and automotive industries as well as in the oil and natural gas sector.
voestalpine BÖHLER Aerospace GmbH & Co KG invested in a state-of-the-art forging press for the production of structural aircraft components and launched the start-up activities for it at the close of the reporting period. A year earlier, the company had already invested in a high-tech fast forge press for highly stress resistant, rotating aircraft turbine components. These trailblazing projects will enable BÖHLER Aerospace to continue satisfying the high quality standards of aerospace industry customers in the future, too.
At EUR 181.0 million, the investment expenditure of the Metal Engineering Division in the business year 2019/20 was 14.1% lower than the amount (EUR 210.8 million) invested in the previous year. The division inaugurated its Metallurgy Center research facility in Donawitz, Austria, in mid-May 2019. This center is a miniature version of a complete steel plant that supports innovations in the field of high-performance steels. The division’s roughly EUR 100 million investment in a new continuous casting plant (“CC4”) that has an annual capacity of 950,000 t was largely completed in the business year ended. The highly digital facility will replace the CC2 unit, which has become obsolete. The work to assemble the plant had started at the beginning of the reporting period. Both the construction cranes and the infrastructure—mainly media and power supplies—were put in place at the same time. The launch of this highly automated plant will likely be kicked off in the first quarter of the business year 2020/21.
At EUR 170.0 million, the investment volume of the Metal Forming Division in the business year 2019/20 also was substantially lower than the amount (EUR 223.2 million) expended in the business year 2018/19. Much was done in recent years to push the division’s internationalization in the Automotive Components business segment. Numerous plants were built in the United States, Mexico, South Africa, and China among other places using innovative product and process technologies. While the division focused chiefly on optimizing its existing facilities in the reporting period, it also implemented a larger project in Shenyang, Northeast China. The new, third phs-ultraform® line was developed in China in its entirety and implemented using national suppliers. The plant was started up in the fall of 2019. The site, which was inaugurated in 2015, has been producing security-related structural parts for international automotive manufacturers since then.
New process technologies were the focal point of the investments of the Tubes & Sections business segment in the business year 2019/20. For example, a high-performance processing center serving particularly the aerospace industry was inaugurated at the segment’s facility in Shelbyville, Kentucky, USA. Further underscoring the emphasis on production technology, a French entity, voestalpine Profilafroid, installed a customized sectioning line during the reporting period’s first half. voestalpine Rotec Coating SRL brought a new high-quality coating facility for safety belt tensioner parts online at the start of calendar year 2020.