Saarstahl Press Release: Good business year 2011 for Saarstahl
09 May 2012
For the Saarstahl Group, the year 2011 was characterised by a good level of incoming orders and high utilization of the capacity of the facilities. The company was able to take advantage of the continued positive development in the automotive and mechanical engineering sector, especially in Germany, as well as the increasing demand in the major markets abroad.
- Group turnover improved from 2.296 to 2.673 billion euros
- Good level of incoming orders and high utilization of the capacity of the facilities
- Chairman of the Board Dr. Karlheinz Blessing commented: “2011 was a good business year in which we, as internationally established premium supplier, were able to benefit from the demand for high quality steel.”
In addition, in 2011, the realization of an outstanding investment project was begun – the building of the new secondary metallurgy. Saarschmiede GmbH Freiformschmiede, on the other hand, felt the effects over the year of the reduction in investment in the energy sector as a consequence of the international debt crisis and the catastrophe in Fukushima and therefore registered a decrease in turnover.
All in all, thanks to good quantities and high sales revenues, the Saarstahl Group was able to improve both the production figures and turnover figures significantly.
Figures for the Saarstahl Group for the year 2011:
- The group production of crude steel increased by 16.9 % in 2011 to 2.362 million tonnes compared with the previous year (2.021 million tonnes).
- Due to the generally positive development regarding quantities and high revenues, the group turnover increased by 16.4 % to 2.673 billion euros (Previous year: 2.296 billion euros). Germany continues to be Saarstahl’s most important sales market but in 2011, it was possible to increase the export to third party countries (NAFTA, Asia, rest of the world).
- The group earnings 2011 before interest and tax (EBIT) amounted to 210 million euros (442 million euros) and the EBITDA (EBIT before depreciation and amortisation) to 354 million euros (553 million euros). A direct comparison of the key financial figures for 2011 with those of the previous year is only possible to a limited degree: The very good result for 2010 was affected by high income from investment and the positive effects of changes in the accounting regulations (German Act on the Modernisation of Accounting). In 2011, Saarschmiede only achieved a balanced result whereas Saarstahl AG was able to increase its EBIT by 33 %.
- With a total workforce of 7,244 (of which 7,036 are consolidated on the balance sheet) the Saarstahl Group continues to be one of the most important employers in the region. On top of this, there are 429 trainees currently doing their occupational training in the group. At Saarstahl AG itself, there was a total of 3,905 employees until 31.12.2011 and, at Saarschmiede GmbH Freiformschmiede 1,153 employees.
- Investments also continued to be made on a high level in 2011. The emphasis was on concluding the modernisation of the bar steel centre in Nauweiler and new construction of the secondary metallurgy. At Saarstahl AG, itself, the investment volume amounted to 122 million euros (2010: 56 million euros). For the two parties with an indirect interest in the company ROGESA Roheisengesellschaft Saar mbH and the Zentralkokerei Saar, the investment expenditure amounted to a total of 57 million euros of which Saarstahl AG bore half, in accordance with its share in the companies.
Cautious Outlook for 2012
The Saarstahl group started the year 2012 with good utilization of capacity. Nonetheless, the overall economic perspective is affected by numerous uncertainties due to the continued debt crisis in Europe, the stagnating development in many industrial nations and the weakening of growth in Asia, in particular, in China. “After two strong business years, we therefore expect a difficult year in 2012 and a slight decrease in the turnover and the result, which will clearly remain positive,” Blessing explains.
The Saarstahl Group is greatly concerned about the further burden placed on them by the energy and climate politics in Germany and the European Union as well as the planned EU guidelines for emission trade. “We are clearly at a disadvantage here compared to companies based outside Europe. And yet it is the German steel manufacturers, in particular, who, with their know-how and with new types of steel, are able to make a considerable contribution to energy efficiency and environmental protection“, Blessing points out. “We can cope with burdens but you must leave us some air so we can breathe.“
Saarschmiede GmbH Freiformschmiede expects a difficult transition year in 2012 with far weaker demand since the new direction being taken with the energy sources gas, coal, nuclear power and renewable energy will take some time. However, in the medium term, the worldwide increase in energy demand, in particular in threshold countries, will lead to a new increase in demand for forgings for power stations of all types.
In the important sales markets for Saarstahl AG of the automotive and mechanical engineering industries, a greatly differentiated market environment in Europe is assumed for 2012. However, the overall good development in the German automotive sector should create positive impetus, especially for wire rod and bar steel in the fields of quality steel and high grade sectional steel. The secondary metallurgy facility planned to go into operation at the beginning of 2013 will create additional capacity in this segment and ensure further improvements in the range of grades offered.
Saarstahl group in figures
1) of which 7,036 are consolidated on the balance sheet
2) including extraordinary income German Act on the Modernisation of Accounting (BilMoG) and others