Image: Andreas-Hofer-Photography.at
In the first three quarters of 2023/24, profit after tax halved from 864 million to 431 million euros compared to the same period in the previous year, as the company announced on Wednesday. Sales fell by 8.8 percent to 12.4 billion euros. “The expected economic downturn was clearly noticeable in the first nine months of the current financial year,” said CEO Herbert Eibensteiner.
- also read: voestalpine boss: “Please no more bureaucracy!”
According to the group, the economic decline is noticeable in some areas: the interest-sensitive segments of construction, mechanical engineering, the consumer goods industry and general investments in industrial production facilities have weakened significantly. From today’s perspective, there will be no recovery in the remaining financial year. Management sees the automotive industry segment remaining stable at its current level in the last quarter. The energy segment will continue its previous good momentum. Continuing good market development is also expected for the railway systems sector. The same applies to the aviation industry, which has seen a dynamic recovery after the massive slump caused by the COVID-19 pandemic.
“Weakest economic development” expected for Europe
For the remainder of the 2023/24 financial year, Europe is expected to experience “the weakest economic development in the world”. The Eurozone has been close to recession in the last two quarters and “no positive impulses are expected” for the last quarter of the current financial year either. The development in North America, on the other hand, continues to be assessed as “relatively robust”. In South America – where Brazil is particularly relevant for the voestalpine Group – the economy appears to have cooled down somewhat in the last financial quarter. China’s overall economy is growing overall, although the individual sectors are developing very differently. The problems in the real estate sector would most likely not be solved in the short term and would subsequently put a strain on the associated sectors, such as the construction industry. However, the manufacturing industry, particularly in the high-tech sector, will continue to develop positively, as in the previous financial year.
In any case, voestalpine is leaving its guidance for the full year 2023/24 unchanged: Management expects – “assuming no unexpected economic upheavals” – earnings before interest, taxes, depreciation and amortization (EBITDA) of 1.7 billion euros.
Number of employees increased
In the first nine months of the current financial year, EBITDA fell from 1.9 billion to 1.3 billion euros – a decrease of 32 percent; the EBITDA margin deteriorated from 13.8 to 10.4 percent. Earnings before interest and taxes (EBIT) fell from 1.1 billion to 713 million euros in the reporting period, a decline of a good 37 percent; the EBIT margin shrank from 8.4 to 5.8 percent. The bottom line is that basic earnings per share (EPS) fell from EUR 3.91 to EUR 2.06.
However, the number of employees worldwide increased slightly – the number of employees increased by 1.4 percent to 50,712 employees (full-time equivalents).
Equity grew by 2.5 percent
Equity also increased, growing by 2.5 percent to 7.8 billion euros. Net financial debt was reduced by almost a quarter from 2.7 billion to 2 billion euros. Gearing improved accordingly: net debt in relation to equity fell from 35.1 percent to 25.8 percent.
The new stainless steel plant in Kapfenberg (Styria) has been in sole operation since the beginning of 2024, the old stainless steel plant was shut down as planned at the end of 2023. In the new plant, voestalpine produces up to 205,000 tons of high-performance materials annually for the automotive, aviation and energy industries, thereby securing around 3,500 jobs in Kapfenberg and Mürzzuschlag.
more from economics
