Metal Forming Division

MARKET ENVIRONMENT AND BUSINESS DEVELOPMENT

The Metal Forming Division performed positively overall in the first half of the business year 2023/24, but mixed with regard to the individual business segments. The environment weakened slightly in the Tubes & Sections business segment and significantly in the Precision Strip business segment. The picture was more positive for the Automotive Components business segment: After a very challenging development in previous years, call-offs improved in H 1 2023/24. Order intake in Warehouse & Rack Solutions was rather subdued in a positive long-term environment.

The Automotive Components business segment showed an improved performance in H 1 2023/24 after supply chain problems in the European auto industry largely dissipated. Automotive manufacturers increasingly worked off the high order backlog formed by production restrictions in the wake of the COVID-19 pandemic and the associated problems in international supply chains. This translated into increased call-offs for automotive components and thus improved capacity utilization at the automotive components plants in the Metal Forming Division. Overall, however, demand in Europe was still very significantly below the level before the outbreak of the COVID-19 pandemic. Call-offs at the North American sites (USA and Mexico) continued to be good. The strikes by the United Auto Workers (UAW) union did not affect customers at the North American Metal Forming sites. The Chinese sites of the Metal Forming Division showed a pleasing development with good capacity utilization.

The Tubes & Sections business segment faced an economic environment which weakened overall in the course of the first half of the business year 2023/24. This was particularly true for the construction industry and the trading business. To make matters worse, many customers reduced their inventories. Orders from the commercial vehicle industry stabilized at a solid level after the boom phase of recent years. Orders from the solar industry continued to be very positive. There was also good demand in the storage technology sector. From a regional perspective, the North American market proved to be very stable, with the aerospace industry in particular reporting growth. The locations in Brazil developed positively—supported by the continued high momentum in the solar industry. Demand from the agricultural machinery industry slowed somewhat. The China site felt the very challenging conditions in the Chinese construction industry, but benefited from orders from the automotive supply industry.

The Precision Strip business segment recorded a significant decline in the first half of the business year 2023/24. This was due on the one hand to the economic slowdown and on the other to the reduction of very high customer inventories built up in the phase of very strong demand following the COVID-19 pandemic and long delivery times. One of the key issues for the European production sites was the high energy costs, which resulted in disadvantages in exports—e.g. at deliveries of strip steel for stone saws to China. In the USA, the economic environment deteriorated at the beginning of the business year 2023/24. Against this background, demand for wood saw steel strip decreased significantly.

The Warehouse & Rack Solutions business unit (shelving and storage systems) operated in a continuing positive market environment in the first half of 2023/24. The growth driver continues to be the international trend towards online trading. There are a large number of inquiries, and the project pipeline is also well filled. However, due to the high interest rate level in Europe and the United States, project awards have been delayed. However, the outlook is positive: Thanks to the high order backlog, capacities are well utilized beyond the current business year 2023/24.

FINANCIAL KEY PERFORMANCE INDICATORS

The financial key performance indicators (KPIs) of the Metal Forming Division were characterized by year-on-year declines. Revenue of the Metal Forming Division decreased by 15.4% to EUR 1,700.1 million in H 1 2023/24, compared to EUR 2,009.9 million in H 1 2022/23. The decline in revenue affected all four business segments. The Automotive Components business segment recorded a comparatively slight weakening.

EBITDA fell from EUR 199.2 million (margin of 9.9%) in the previous year to EUR 161.3 million (margin of 9.5%) in the first half of 2023/24. This is a decline of 19.0%. While EBITDA developed stably in the Warehouse & Rack Solutions business segment, it declined in the other divisions. The decline was particularly pronounced in the Precision Strip business segment.

EBIT decreased by 29.5% from EUR 126.1 million (margin of 6.3%) to EUR 88.9 million (margin of 5.2%) in the same period.

KPIs also declined in a quarter-on-quarter (QoQ) comparison. For example, revenue in Q 2 2023/24 decreased by 7.7% to EUR 816.1 million (Q 1 2023/24: EUR 884.0 million). This development affected all four business segments. While the declines in the Automotive Components, Tubes & Sections and Warehouse & Rack business segments were moderate, they were particularly pronounced in the Precision Strip business segment.

EBITDA declined slightly by 1.8% from EUR 81.4 million (margin of 9.2%) to EUR 79.9 million (margin of 9.8%) from Q 1 to Q 2 2023/24. Improvements were reported by the Automotive Components and Warehouse & Rack Solutions business segments. The Tubes & Sections business segment recorded a largely stable development. By contrast, the Precision Strip business segment posted a significant decline in EBITDA.

EBIT decreased by 6.3% quarter-on-quarter to EUR 43.0 million with a margin of 5.3% (Q 1 2023/24: EUR 45.9 million with a margin of 5.2%).

As of September 30, 2023, the number of employees (FTE) in the Metal Forming Division was 11,668, 1.9% below the previous year’s figure of 11,892.