D.26. Related party disclosures

Business transactions between the Group and non-consolidated subsidiaries and associates or their subsidiaries as well as joint ventures primarily relate to supply relationships in connection with the purchase of raw materials or the sale of finished goods and are conducted at arm’s length. They are included in the following items of the Consolidated Financial Statements:

Receivables from and liabilities to associates and joint ventures as well as non-consolidated subsidiaries comprise both direct and indirect relationships.

In addition, there are business transactions with core shareholders that document a significant influence because the voestalpine shares are consolidated using the equity method. Business transactions are conducted at arm’s length and are presented as follows:

An interest expense of EUR 2.1 million (2023/24: EUR 2.7 million) was recognized in connection with the aforementioned financial liabilities as well as trade and other payables.

There are no trade payables from bills of exchange and trade payables from reverse factoring agreements with core shareholders as of the reporting date.

Under the first type of factoring agreement (see Note D.29. Disclosures of transactions not recorded in the statement of financial position), receivables are sold to core shareholders at arm’s length. As of March 31, 2025, these receivables were recognized at a total of EUR 180.4 million (2023/24: EUR 191.5 million). An interest expense of EUR 6.2 million (2023/24: EUR 5.4 million) was recognized for the business year 2024/25 in this connection.

The non-inclusion of the non-consolidated entities in the Consolidated Financial Statements has no material impact on the Group’s net assets, financial position, and results of operations.

Management Board

The fixed compensation of the Management Board is determined by the General Committee of the Supervisory Board pursuant to Austrian legal requirements and is reviewed periodically.

The award of a bonus is subject to a target agreement to be concluded with the General Committee of the Supervisory Board consisting of quantitative and qualitative targets. The maximum bonus is limited to 200% of the annual gross salary for members of the Management Board and to 250% of the annual gross salary for the Chairman of the Management Board. If the agreed quantitative targets are achieved exactly, 60% of the maximum bonus applies; if the agreed qualitative targets are achieved, 20% of the maximum bonus applies. Any overachievement of the quantitative targets is taken into account proportionately until the maximum bonus is reached. The quantitative targets are “earnings before interest and taxes” (EBIT); “return on capital employed” (ROCE); and “operating working capital as a percentage of revenue.” The specific target amounts applicable to EBIT and ROCE are determined periodically (in each case for a period of three years) by the General Committee of the Supervisory Board in consultation with the Management Board. The target amount for operating working capital as a percentage of revenue is determined specifically for the given business year. These target amounts are calculated independently of the respective budget and/or the medium-term business plan, i.e., meeting the budget does not mean that a bonus is granted. The qualitative targets for the business year 2024/25 were firstly the “Transformation of Metallurgy 2035+ until the completion of decarbonization,” which includes the refinement of the decarbonization roadmap for blast furnace-based steel production specifying the relevant decision-making milestones leading up to complete phase-out and the development of cost comparison models for the various technology scenarios. Second the "Expansion of the circular economy with sustainable recycling models” was agreed, focusing on increasing scrap return flows from internal and external sources. The aim is to establish circular processes that enable a gradual 5% annual increase in externally sourced customer scrap volumes in the 2024/25 and 2025/26 business years to prepare for the first transformation stage and to form the basis for the further roll-out of the scrap procurement strategy.

In the reporting period, the chairman of the Management Board is entitled to a defined benefit pension based on pension commitments under legacy contracts or prior roles within the Group before his appointment to the Management Board. The contractual pension amount payable to the chairman of the Management Board depends on the length of his service. The annual pension equals 1.2% of the most recent annual gross salary for each year of service, but the pension benefit may not exceed 40% of the most recent annual gross base salary.

Upon termination of their director’s contracts, Management Board members are granted severance pay that is modelled on the approach set forth in the Austrian Employment Act (Angestelltengesetz – AngG), pursuant to which the maximum allowable under the law may not be surpassed.

D&O insurance has been purchased for the members of the Management Board (as well as for the Group’s executives) and for the members of the Supervisory Board; the cost is borne by the company.

The compensation paid to the members of the Management Board of voestalpine AG for the business year 2024/25 comprises the following:

As of the reporting date, the outstanding balance of the variable compensation was EUR 5.67 million (2023/24: EUR 5.02 million), EUR 0.00 million (2023/24: EUR 0.82 million) relating to the post-employment benefits and EUR 0.00 million (2023/24: EUR 0.47 million) to termination benefits. No advances or loans were granted to the members of the Management Board of voestalpine AG.

Pension payments totaling EUR 2.05 million (2023/24: EUR 1.74 million) were paid by the pension fund to former members of the Management Board with defined benefit pension agreements.

Supervisory Board

Pursuant to Article 15 of the AoA of voestalpine AG, the amount of the compensation and of the attendance fee payable to the Supervisory Board members elected by the Annual General Meeting (AGM)—i.e., the shareholder representatives—is determined by the AGM.

The members of the Supervisory Board nominated by the Works Council are not entitled to any compensation for their work on the Supervisory Board, nor to any attendance fees.

The Management Board and the Supervisory Board will propose the following Supervisory Board compensation and attendance fee to the Annual General Meeting on July 2, 2025:

Subject to approval by the Annual General Meeting on July 2, 2025, the total compensation payable to the Supervisory Board (including attendance fees) for the business year 2024/25 is EUR 0.63 million (2023/24: EUR 0.60 million).

The compensation of the Supervisory Board for the business year 2024/25 will be paid no later than 14 days after the Annual General Meeting on July 2, 2025.

No advances or loans were granted to members of the Supervisory Board of voestalpine AG.