EQS-News: voestalpine AG: voestalpine holds its own in the first half of 2024/25 in an overall challenging economic environment

EQS-News: voestalpine AG / Key word(s): Half Year Results
voestalpine AG: voestalpine holds its own in the first half of 2024/25 in
an overall challenging economic environment

13.11.2024 / 07:30 CET/CEST
The issuer is solely responsible for the content of this announcement.

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• Focus on high-tech products, along with broad positioning by sector
and region, supports Group earnings
• Revenue down slightly year-on-year to EUR 8 billion (from EUR 8.5
billion)
• EBITDA of EUR 718 million influenced by negative one-off effects
(previous year: EUR 903 million)
• Equity remains stable at EUR 7.4 billion compared to the reporting
date (March 31, 2024), leverage at a solid level of 27.5% (March 31,
2024: 22.0%)
• Numerous international growth projects are in progress
• Successful placement of the green bond—the first by a European steel
company
• Number of employees (FTE) increased by 1% year-on-year to 51,700
• EBITDA outlook at around EUR 1.4 billion

voestalpine performed well in the first half of the business year 2024/25
(April 1 – September 30, 2024) despite a challenging economic environment,
especially for the European steel industry. The steel and technology
Group’s strategy of concentrating on high-tech steel products once again
proved its strength. The railway infrastructure and aerospace sectors
performed very well in the first half of the year. Demand remains
particularly strong for voestalpine’s state-of-the-art high bay
warehousing systems, made from the most advanced steel profiles. The
energy sector recorded a decline in demand and also the construction and
mechanical engineering industries remained at a persistently low level. In
the automotive sector, profit warnings from renowned European car
manufacturers indicated no imminent improvement in sales figures for the
European automotive industry, which also impacts the demand for
voestalpine products. In contrast, the non-European Automotive Components
locations continued to report good capacity utilization.

“In this extremely difficult environment for European steel companies,
voestalpine once again demonstrates its flexibility and adaptability. In
business segments facing structural changes, we responded immediately with
specific measures, such as reorganizing our German Automotive Components
locations. At the same time, we are implementing numerous international
growth projects in railway infrastructure, storage systems, and high-tech
special tubes and sections. Our broad positioning across industries and
regions stabilizes the Group’s results and validates the resilience of our
corporate strategy,” says Herbert Eibensteiner, CEO of voestalpine AG.

Important future projects

voestalpine has advanced numerous important future projects in the first
half of 2024/25, including new long-term contracts with two global truck
manufacturers for the North American market. To this end, voestalpine is
expanding production capacity at its existing location in Indiana, USA.
The investment for the expansion amounts to EUR 70 million (USD 78
million) and will create 110 new jobs. In the high bay warehousing sector,
voestalpine is currently implementing projects for the Danish retail chain
JYSK and the South Korean tire manufacturer Nexen Tire Corporation. For
Nexen Tire Corporation, voestalpine is building the highest high bay
warehouse in the Group’s history, at 50 meters, in the Czech Republic by
2025. There is also positive news from a flagship project in the railway
infrastructure sector: voestalpine Railway Systems is supplying around 260
high-speed turnouts, including maintenance software, for Egypt’s first
high-speed line, the “Green Line.” The first turnouts have left the
factory in Cairo by now.

First green bond

In June, voestalpine became the first European steel company to publish
its “green financing framework.” Based on this framework and amid high
investor interest, the Group issued its first green bond at the end of
September, with a volume of EUR 500 million (settlement date: October 3,
2024, and therefore not included in the 2024/25 half-year financial
statements). The proceeds will be entirely used to finance sustainable
voestalpine projects, such as greentec steel.

Challenging economic environment influences key performance indicators

Revenue declined in the first half of 2024/25, reaching EUR 8.0 billion,
which is 5.5% below the comparative period in the first half of 2023/24
(EUR 8.5 billion). The operating result EBITDA decreased by 20.5%
year-on-year to EUR 718 million in the first half of 2024/25 (H1 2023/24:
EUR 903.4 million). The operating result is also influenced by negative
one-off effects: As reported, voestalpine has concluded negotiations for
the sale of its German subsidiary Buderus Edelstahl with the signing of
the contract with the German investment company Mutares SE & Co. KGaA.
Required write-downs in the course of the sales process resulted in
negative one-off effects totaling EUR 81 million in the first half of
2024/25. The transaction is expected to be completed by the end of the
fourth calendar quarter of 2024.

Profit from operations (EBIT) fell by around a third year-on-year to
EUR 338 million (H1 2023/24: EUR 519 million). At EUR 249 million,
earnings before taxes were 41.9% below the previous year’s figure of
EUR 428 million. Profit after tax fell by 43.0% to EUR 183 million (H1
2023/24: EUR 321 million).

Net financial debt was reduced year-on-year by 1.7%, from EUR 2.1 billion
to EUR 2.0 billion as of September 30, 2024, while it increased by 23.9%
compared to the reporting date (March 31, 2024: EUR 1.7 billion). At
EUR 7.4 billion as of September 30, 2024, equity fell by 3.9% compared to
the previous year (EUR 7.7 billion) and decreased slightly by 1.0%
compared to the reporting date of March 31, 2024 (EUR 7.5 billion). The
gearing ratio (net financial debt in relation to equity) increased from
26.9% as of September 30, 2023, to 27.5% as of September 30, 2024, as well
as compared to the reporting date (March 31, 2024: 22.0%).

As of September 30, 2024, the voestalpine Group employed around 51,700
people worldwide (full-time equivalent), 1% more than in the previous year
(51,200).

Outlook

At the start of the 2024/25 business year, the weak performance of the
construction, mechanical engineering, and consumer goods industries was
partly offset by very good demand from the railway infrastructure,
aerospace, warehouse and rack solutions, and conventional energy sectors.
The automotive industry also performed largely stable at a solid level.

The conventional energy sector already weakened noticeably over the course
of the first quarter and the automotive industry also lost momentum
significantly at the end of the second quarter following a series of
profit warnings from renowned European OEMs. The economic mood in Europe
changed over the course of the first half of 2024/25 after large
corporations announced extensive plans to reduce their workforce.

As a result, the voestalpine Group had to withdraw its earnings forecast
in an ad hoc announcement on October 14, 2024. Based on the results of the
first half of 2024/25, the significantly deteriorated market developments
in Europe, the non-recurring burdens on earnings totaling more than EUR
100 million from the sale of Buderus Edelstahl, and the reorganization of
the Automotive Components business in Germany, the Management Board of
voestalpine AG currently expects EBITDA for the business year 2024/25 to
be in the region of EUR 1.4 billion.

This earnings outlook is based on the expectation of continued good global
development in the Railway Infrastructure, Aerospace, and Warehouse
Technology business segments. The assessment of the performance of
voestalpine’s non-European sites in the other business segments also
remains positive for the second half of 2024/25. The Management Board of
voestalpine AG is meeting the challenges in Europe, particularly in
Germany, with active management and, where not otherwise possible, by
reducing the Group’s presence in this region.

From the very beginning, the voestalpine Group took into account the
climate protection-related transformation requirements of its European
blast furnace-based steel sites with a balanced strategy between expected
market development, technically feasible solutions, and economic
viability. The implementation of the greentec steel projects in the Steel
Division and the Metal Engineering Division is proceeding according to
plan, both in terms of time and money.

The voestalpine Group

voestalpine is a globally leading steel and technology group with a unique
combination of materials and processing expertise. voestalpine, which
operates globally, has around 500 Group companies and locations in more
than 50 countries on all five continents. The voestalpine Group has been
listed on the Vienna Stock Exchange since 1995. With its premium products
and system solutions, voestalpine is a leading partner to the automotive
and white goods industries, as well as to the aerospace and energy
industries. The company is also the global market leader in railway
systems, tool steel, and special sections. voestalpine is committed to the
global climate goals and has a clear plan for transforming steel
production with its greentec steel program. In the business year 2023/24,
the Group generated revenue of EUR 16.7 billion, with an operating result
(EBITDA) of EUR 1.7 billion; it has around 51,600 employees worldwide.

Please direct your inquiries to

voestalpine AG
Peter Fleischer
Head of Investor Relations

voestalpine-Strasse 1
4020 Linz, Austria
T. +43/50304/15-9949
peter.fleischer@voestalpine.com
[1] www.voestalpine.com
 

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13.11.2024 CET/CEST This Corporate News was distributed by EQS Group AG.
www.eqs.com

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Language: English
Company: voestalpine AG
voestalpine-Straße 1
4020 Linz
Austria
Phone: +43 50304/15-9949
Fax: +43 50304/55-5581
E-mail: IR@voestalpine.com
Internet: www.voestalpine.com
ISIN: AT0000937503
WKN: 897200
Listed: Vienna Stock Exchange (Official Market)
EQS News ID: 2028357

 
End of News EQS News Service

2028357  13.11.2024 CET/CEST

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