Metal Forming Division

This report is a translation of the original report in German, which is solely valid.

Market environment and business development

The Metal Forming Division delivered altogether solid performance in the first three quarters of the business year 2021/22. Three of its business segments—Tubes & Sections, Precision Strip as well as Warehouse & Rack Solutions—benefited from very good demand in the third business quarter, escaping the overheating trends that made themselves felt now and then during the current business year’s first half. By contrast, the Automotive Components business segment had to contend with adverse conditions.

While demand for passenger cars collapsed in the Northern spring of 2020 owing especially to the first COVID-19 wave, in 2021 production issues were at the root of the weakness in global sales volumes. Semiconductor supply bottlenecks impacted global automotive production in calendar year 2021. Consequently, new passenger car registrations in Europe were even slightly lower in 2021 than they were during the preceding 2020 pandemic year. In the current business year, the Automotive Components business segment has been challenged by highly volatile order call-ups as well as, in particular, by original equipment manufacturers’ cancellations on short notice. The lack of key components within the automotive industry’s value chain affected the industry in different ways, depending on manufacturer and region. The fact that automotive production in Germany, Automotive Components’ most impor­tant sales market, declined in calendar year 2021 for the fifth year in a row illustrates the difficult environment. voestalpine’s affected production plants responded to these issues by adjusting capacity immediately. The impact of the semiconductor bottlenecks on the automotive industry will likely continue into the next business year.

During the business year to date, the Tubes & Sections business segment has experienced highly satisfactory demand in its key customer segments and regions. The segment’s solid order levels in its European core markets were rooted especially in the dynamic performance of the agricultural machinery and commercial vehicle customer segments as well as that of the construction and storage technology industry. Solely demand from the automotive and solar industries was stuck on a moderate level.

In contrast to the trend in Europe, the solar industry in Brazil was precisely the customer segment that enabled the exceedingly positive performance of the Tubes & Sections business segment in that country. Thanks to their specific production and industry mix, voestalpine’s Brazilian entities succeeded in performing very well throughout the reporting period despite the weakening of the country’s economy in the second and third business quarters. In the United States, for its part, the booming storage technology sector offset weak orders from the aerospace industry. The segment’s activities in China with respect to deliveries of tubes and sections also followed a positive trajectory.

In the Precision Strip business segment, favorable conditions have prevailed throughout the business year 2021/22 to date. The positive macroeconomic situation led, here and there, to pre-materials supply chain disruptions. In the U.S., sales of wood band saws drove the demand for band saw steel. In China, this business segment delivered substantial growth due, in particular, to the strong momentum in the paper and printing industry. High energy prices in Europe are starting to have a negative impact on business, especially in North America and China.

The excellent performance of the Warehouse & Rack Solutions business segment in previous years, which offers turnkey solutions in storage technology and high-bay warehouses, continued unabated in the first three quarters of the current business year. Rising e-commerce remains the driver of this success story. Numerous projects were completed in Europe and the United States.

Financial key performance indicators

Just as in the other three divisions of the voest­alpine Group, in the previous business year the key performance indicators (KPIs) of the Metal Forming Division clearly reflected the negative impact of the COVID-19 pandemic. But the numbers for the first three quarters of the business year 2021/22 clearly show the subsequent upward trend. Revenue rose 39.5% to EUR 2,453.5 million (Q 1 – Q 3 2020/21: EUR 1,758.7 million). With the exception of Automotive Components, which had to contend with automotive manufacturers’ volatile order call-ups, the division’s other business segments delivered highly dynamic performance throughout the business year to date as the earnings categories show. Year over year, EBITDA jumped 87.3% to EUR 280.6 million with a margin of 11.4% (Q 1 – Q 3 2020/21: EUR 149.8 million, margin of 8.5%). EBIT soared in the same period by 283.7% to EUR 170.0 million with a margin of 6.9% (Q 1 – Q 3 2020/21: EUR 44.3 million, margin of 2.5%).

The quarter-on-quarter (QoQ) comparison of the current business year’s second and third quarters shows that the KPIs of the Metal Forming Division largely remained stable. The increase in revenue by 5.7% from EUR 791.6 million in Q 2 2021/22 to EUR 836.4 million in Q 3 2021/22 is primarily due to the Automotive Components business segment. Starting from a low level, it posted a slight increase in its business volume. The slightly higher utilization of production capacity in Automotive Components also led to slight improvements in EBITDA by 3.3%, from EUR 86.6 million (margin of 10.9%) to EUR 89.5 million (margin of 10.7%), and in EBIT by 4.0%, from EUR 50.0 million (margin of 6.3%) in Q 2 2021/22 to EUR 52.0 million (margin of 6.2%) in Q 3.