Metal Forming Division

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

Market environment and business development

Irrespective of declining demand in individual customer segments and subdued component order call-ups throughout from the automotive industry, the performance of the Metal Forming Division in the first three quarters of the business year 2022/23 was very solid.

The Automotive Components business unit, in particular, faced challenging conditions. Semi-conductor supplies have been tight for quite some time, and the adverse effects of these supply chain problems on automakers’ production continued unabated in the current business year to date. However, a slight improvement in the situation appeared on the horizon toward the end of calendar year 2022. Against this backdrop, the order call-ups from original equipment manufacturers (OEMs) in Europe remained at a low level overall and extremely volatile. Demand in North America was relatively solid at the start of the current business year, but the momentum began to wane as the year wore on. voestalpine’s plants in China experienced largely advantageous conditions, irrespective of a lockdown in Shenyang that lasted several weeks.

In Tubes & Sections business unit, the economic environment in individual customer segments softened a bit over the course of the current business year’s first three quarters. Thanks to a solid order book, however, the performance of Tubes & Sections in the reporting period was very satisfactory nonetheless. In Europe, the economic momentum declined dramatically, especially in the construction sector. Orders from the automotive supplier industry also fell slightly short of expectations. By contrast, demand from the solar industry, the commercial vehicle industry as well as the agricultural and construction machinery industry remained good. In Brazil, voestalpine’s production facilities also benefited from brisk activity in the solar industry as well as, additionally, in the bus segment. In the United States, the Tubes & Sections business unit relied on satisfactory developments in storage technology.

The Precision Strip business unit benefited from an advantageous environment throughout the reporting period. Orders from customers in markets overseas did not begin to decline until the Northern fall of 2022. This was due chiefly to competitive disadvantages arising from the high cost of energy in Europe. Thanks to its strong order book, this business unit succeeded in maintaining a highly satisfactory level of capacity utilization in production throughout the business year to date.

The Warehouse & Rack Solutions business unit was faced with a similar situation, in part due to a downward trend in connection with new project orders. However, the unit’s extensive orders on hand lead us to expect that capacity utilization will be solid even beyond the end of the business year 2022/23.

Financial key performance indicators

Thanks to the division’s ability to impose higher sale prices on its customers owing to the increase in the cost of input materials, the revenue of the Metal Forming Division for the first three quarters of the business year 2022/23 rose by 19.1% to EUR 2,921.2 million (Q1−Q3 2021/22: EUR 2,453.5 million). Earnings for the reporting period also reflect the division’s largely stable performance. At EUR 278.6 million with a margin of 9.5%, the operating result (EBITDA) is just slightly lower year over year (Q1–Q3 2021/22: EUR 280.6 million, margin of 11.4%). While the Precision Strip business unit succeeded in raising its operating result a bit year over year, the other three business units had to contend with slightly weakened EBITDA. At EUR 170.3 million with a margin of 5.8% for the reporting period on the whole, the Metal Forming Division’s profit from operations (EBIT) also comes close to the previous year’s figure (Q1−Q3 2021/22: EUR 170.0 million, margin of 6.9%).

The quarter-on-quarter (QoQ) comparison of the second and third quarters of the current business year shows a slight decline in the division’s key performance indicators (KPIs). Revenue fell 6.2% in Q3 2022/23 to EUR 911.3 million (Q2 2022/23: EUR 971.4 million). Division EBITDA for the third business quarter declined 6.8% to EUR 79.4 million (Q2 2022/23: EUR 85.2 million). While earnings in the Group’s other three divisions were largely stable, the performance of the Metal Forming Division was affected by the downturn in the Automotive Components business unit. EBIT for the third business quarter fell by 8.3% to EUR 44.2 million with a margin of 4.9% (Q2 2022/23: EUR 48.2 million, margin of 5.0%).

As of December 31, 2022, the Metal Forming Division had 11,454 employees (FTE), an increase of 0.4% over the previous business year (11,405 employees).