EQS-News: voestalpine AG: voestalpine with solid half-year results for 2023/24 despite economic slowdown

EQS-News: voestalpine AG / Key word(s): Half Year Results
voestalpine AG: voestalpine with solid half-year results for 2023/24
despite economic slowdown

08.11.2023 / 07:30 CET/CEST
The issuer is solely responsible for the content of this announcement.

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voestalpine with solid half-year results for 2023/24 despite economic
slowdown

• Revenue for the first half of 2023/24 fell by 8.4% from EUR 9.3
billion to EUR 8.5 billion compared to record figures in the previous
year
• EBITDA fell by 36.7% from EUR 1.4 billion to EUR 915 million
• EBIT fell by 40.9% year over year, from EUR 898 million to EUR 531
million
• Profit before tax is EUR 440 million (H1 2022/23: EUR 846 million);
profit after tax is EUR 333 million (H1 2022/23: EUR 715 million)
• Gearing ratio improved year over year, from 32.7% to 26.6%
• Employees: 51,212 FTE (+1.7%)
• Economic slowdown intensifies, with developments differing widely by
sector

voestalpine achieved a solid result in the first half of 2023/24 (April 1
to September 30) despite a weaker overall economic environment. Over the
reporting period, the economic momentum continued to slow down in Europe
in particular. For voestalpine, this meant a decline in demand from the
construction, mechanical engineering, and consumer goods segments. Exports
by Chinese steel manufacturers also placed huge pressure on the
international steel markets. Nevertheless, voestalpine’s performance in
its most important customer segments remained consistently positive thanks
to its strategic focus on the highest quality. In the automotive industry
for instance, easing of the global supply chain situation resulted in
stable production levels. The rail and aerospace industries, the
conventional energy sector (oil & natural gas) and the renewable energy
sector (solar industry) also continued to perform very well, defying the
overall economic trend. Positive demand also prevailed in storage
technology.

“In a market environment that was challenging at times, voestalpine was
able to demonstrate its strengths in the first half of 2023/24 with its
focus on high-quality products, particularly for the mobility and energy
industries. The last business year saw record figures. The present results
are in line with the long-term average and are definitely satisfactory in
view of the current economic conditions,” says Herbert Eibensteiner, CEO
of voestalpine AG. The launch of greentec steel, voestalpine’s ambitious
step-by-step plan for a green steel production, recently represented an
important step in the Group’s future viability. The plan is for one blast
furnace at each of the Linz and Donawitz sites to be replaced by a green
electricity-powered electric arc furnace by 2027, resulting in a 30%
reduction in carbon emissions. The official opening of the new high-tech
stainless steel plant in Kapfenberg represented a further milestone for
the future.

Development of revenue and earnings
After the voestalpine Group achieved record levels of revenue and earnings
in the first half of the 2022/23 business year, weaker financial
performance indicators were recorded when compared year over year.
Specifically, revenue decreased by 8.4% from EUR 9.3 billion to EUR 8.5
billion in the first half of 2023/24. EBITDA fell by 36.7% from EUR 1.4
billion (margin of 15.6%) to EUR 915 million (margin of 10.7%). The Metal
Engineering Division was able to increase both revenue and EBITDA,
supported by strong performance in the Railway Systems business unit and
the Tubulars (seamless tubes) product segment. The other three divisions
reported weaker development for the reporting period. Profit from
operations (EBIT) fell by 40.9% in the first half of 2023/24, from EUR 898
million (margin of 9.7%) to EUR 531 million (margin of 6.2%).

Net financial income (financial income less finance costs) fell from EUR
–52 million to EUR –91 million. As a result, profit before tax fell by
48.1% year over year from EUR 846 million to EUR 440 million. The
voestalpine Group generated a profit after tax of EUR 333 million (–53.5%)
overall in the first half of 2023/24.

The gearing ratio (net financial debt as a percentage of equity) fell year
over year from 32.7% to 26.6% as of September 30, 2023. Specifically,
voestalpine was able to reduce its net financial debt by 15.6% from EUR
2.5 billion to EUR 2.1 billion in the reporting period. In terms of the
equity, the Group recorded a slight increase of 3.9% from EUR 7.5 billion
to EUR 7.8 billion compared to the first half of the previous year. The
number of employees (FTE, full-time equivalent) increased by 1.7% to
51,212 employees compared with the previous year’s reporting date.

Outlook
The economic slowdown that has been expected for almost a year arrived in
some areas of the voestalpine Group in the first half of the business year
2023/24, particularly in the second quarter.

As expected, the market environment in the construction, mechanical
engineering, and consumer goods industries has weakened. From today’s
perspective, the current situation is expected to continue in the second
half of the business year 2023/24 and thus we assume no substantial
improvement in demand in these segments. This means stagnating demand at a
subdued level.

From today’s perspective, the automotive industry should remain largely
robust in the second half of 2023/24. Although the high order backlogs
built up as a result of the pandemic are increasingly being processed by
car manufacturers, overall development is expected to remain largely
stable until the end of the current business year.

The conventional energy sector (oil and natural gas) lost momentum on the
price side in the course of the first half of the business year 2023/24,
but this is due to the reduction of material bottlenecks and not to market
weakness. Demand for voestalpine products for the oil and natural gas
industry has consequently normalized. A largely stable development can be
anticipated for the second half of 2023/24. The good market environment in
the renewable energy sector (photovoltaics) is expected to continue for
the remainder of the business year 2023/24.

In the area of railway systems, the current very good development is
expected to continue for the remainder of the business year, although the
usual seasonality over the Northern winter has to be taken into account.

The upward trend in the aerospace industry will also continue in the
second half of the business year 2023/24.

The forecasts are therefore largely in line with previous assessments,
although the economic outlook for Europe must now be viewed somewhat more
cautiously. Investment activity in the industrial sector in particular has
slowed and is estimated to remain at a low level in the second half of
2023/24.

Therefore, assuming no massive economic distortions on account of the
central banks’ interest rate policies or geopolitical escalation
scenarios, the Management Board of voestalpine AG expects EBITDA for the
business year 2023/24 to be at the lower end of the previously stated
range (EUR 1.7 to 1.9 billion) and thus in the region of EUR 1.7 billion,
which is also in line with current market expectations.

The impact of current geopolitical developments remains difficult to
assess. However, it is clear that the war in Europe and the armed conflict
in the Middle East have significantly increased the risk of unforeseeable
influences on the economic environment. This makes all forecasts more
uncertain.

KEY FIGURES – voestalpine GROUP

  H1 BY 2022/23 H1 BY 2023/24 Change
  04/01/–09/30/2022 04/01/–09/30/2023 in %
Revenue 9,295.2 8,512.8 -8.4
EBITDA 1,445.7 914.6 -36.7
EBITDA margin in % 15.6% 10.7%  
EBIT 898.1 531.1 -40.9
EBIT margin in % 9.7% 6.2%  
Profit before tax 846.3 439.6 -48.1
Profit after tax from 626.9 334.5 -46.6
continuing operations
Profit after tax from 88.2 -2.0  
discontinued operations
Profit after tax * 715.1 332.5 -53.5
       
EPS – basic earnings per share 3.30 1.59 -51.8
from continuing operations
(euros)
EPS – basic earnings per share 0.50 -0.01  
from discontinued operations
(euros)
EPS – basic earnings per share 3.80 1.58 -58.4
(euros)
       
EPS – diluted earnings per 3.30 1.56 -52.7
share from continuing
operations (euros)
EPS – diluted earnings per 0.50 -0.01  
share from discontinued
operations (euros)
EPS – diluted earnings per 3.80 1.55 -59.2
share (euros)
       
Gearing ratio in % (09/30) 32.7% 26.6%  
In millions of euros

* Before deduction of non-controlling interests.

The Report of the first half of 2023/24 of voestalpine AG as of the
September 30, 2023, may be accessed on the company’s website at
[1] www.voestalpine.com under the ’Investors’ tab.

In case of questions, please contact the company’s Investor Relations team
at +43/50304/15-9949.

Please direct any inquiries to:

voestalpine AG
Peter Felsbach
Head of Group Communications I Group Spokesperson
voestalpine-Strasse 1
4020 Linz, Austria
T. +43/50304/15-2090
peter.felsbach@voestalpine.com

Peter Fleischer
Head of Investor Relations
voestalpine-Strasse 1
4020 Linz, Austria
T. +43/50304/15-9949
peter.fleischer@voestalpine.com

[2] www.voestalpine.com

 

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08.11.2023 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: 1767509

 
End of News EQS News Service

1767509  08.11.2023 CET/CEST

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