This report is a translation of the original report in German, which is solely valid.
Market environment and business development
The development of the first quarter of 2023/24 was very satisfying for the Steel Division overall, whereby the markets presented themselves in two parts. While the automotive industry showed very good demand for steel products from the Steel Division and the energy sector remained at a good level, the other main market segments recorded declines in demand.
The automotive industry showed significantly improved demand for voestalpine’s steel products in Q1 2023/24, also driven by catch-up effects from automotive manufacturers after last year’s supply chain issues, which are increasingly being resolved.
The consumer goods and white goods industries continue to be characterized by a weak demand situation. The boom during the COVID-19 lockdowns was followed by a period of very low demand for household appliances, which is still ongoing and did not show any momentum in the current reporting quarter either.
The mechanical engineering sector benefited from high order backlogs for much of the last business year. However, demand cooled noticeably in the first quarter of 2023/24.
The construction industry, which already showed weakening trends in the second half of the last business year 2022/23, lost further momentum in the current reporting period.
The energy sector, as a key market for the heavy plate segment, performed very satisfying overall despite declining oil and natural gas prices.
The prices of raw materials essential for steel production, such as iron ore and metallurgical coal, moved sideways over the rest of the quarter after a decline at the beginning of the reporting period. In the short-term business, steel prices reflected the weakness in demand in the aforementioned market segments and decreased slightly.
Development of the key figures
In millions of euros |
|
|
|
Change |
||
|---|---|---|---|---|---|---|
|
|
04/01– |
|
04/01– |
|
|
|
|
|
|
|
|
|
Revenue |
|
1,826.2 |
|
1,643.6 |
|
–10.0 |
EBITDA |
|
526.8 |
|
174.2 |
|
–66.9 |
EBITDA margin |
|
28.8% |
|
10.6% |
|
|
EBIT |
|
461.8 |
|
110.0 |
|
–76.2 |
EBIT margin |
|
25.3% |
|
6.7% |
|
|
Employees (full-time equivalent), end of period |
|
10,366 |
|
10,657 |
|
2.8 |
While the previous year was still heavily influenced by the distortions of the Ukraine war and the resulting price spikes on the procurement and sales markets, the Steel Division’s key financial figures for the first quarter of 2023/24 were characterized by a more moderate development. Revenue decreased by 10.0% to EUR 1,643.6 million (Q1 2022/23: EUR 1,826.2 million). At the same time, the Steel Division succeeded in slightly increasing shipments year-on-year. However, the exceptionally high price level of the previous year remained out of reach in the reporting period. Falling steel prices combined with continued high input costs for raw materials and energy led to a decline in the operating result (EBITDA) by two thirds to EUR 174.2 million in the first quarter of 2023/24 (Q1 2022/23: EUR 526.8 million). The EBITDA margin thus fell from 28.8% to 10.6%. The profit from operations (EBIT) fell by 76.2% year-on-year to currently EUR 110.0 million, reflecting a margin of 6.7% (Q1 2022/23: EUR 461.8 million; margin of 25.3%).
In terms of the number of employees (FTE, full-time equivalent), the Steel Division recorded a year-on-year increase of 2.8% to 10,657 as of June 30, 2023 (Q1 2022/23: 10,366).