With the completion of the direct reduction plant in Corpus Christi, Texas, the voestalpine Group has set a further milestone in implementing its international growth strategy: today, after around two-and-a-half years of construction, the world’s largest and most state-of-the-art plant of its type was officially opened. At EUR 550 million (USD 740 million), the plant is the largest investment ever made in the US by an Austrian company. Each year it will produce two million tonnes of high-quality HBI (Hot Briquetted Iron, or sponge iron), a sophisticated pre-material used in steel production. The plant is already regarded as an environmental benchmark and is an important first step on voestalpine’s path of reducing CO2 emissions in steel production.
As the global market leader for complete turnout systems and European market leader for high-quality rails, voestalpine is continuously recording increasing order volumes for international railway infrastructure projects. The Metal Engineering Division, responsible for railway technology within the Group, is further extending its global leadership position, particularly by winning orders for key projects in the growing markets in Asia and the NAFTA region. At the same time, advancing digitalization of Europe’s railways is resulting in rising demand for innovative signaling and safety technology from the voestalpine Group. This was the backdrop to the Group’s appearance at InnoTrans 2016, the leading international trade fair for transport technology which ran from September 23 to 26 in Berlin and focused on integrated and highly digitalized system solutions for railway operators.
voestalpine is not only constantly expanding its international production capacities in the mobility sector, investment in this growth segment also continues in Linz. Around EUR 30 million has recently flowed into the construction of a new plant for manufacturing high-quality blanks which will then be processed into automotive components. Following a construction period of just over a year, today marked the opening of what is now the world’s largest production site for laser-welded blanks in ultra high-strength steels. In future, 20 million blanks a year will be produced in Linz and exported throughout the world.
The voestalpine Group is continuing its global drive to innovate in the field of pioneering technologies: today a new research and development center for 3D printing of metal parts was opened at the voestalpine site in Düsseldorf. The voestalpine Additive Manufacturing Center will bundle all the Group’s research activities in this field, harnessing the manufacturing process for particularly complex and lightweight metal components for use in aviation and aerospace, the automotive industry, tool manufacturing, etc. The next step will be more cooperative partnerships and locations in North America and China. In future the raw material required for the process—a specially manufactured metal powder—will be supplied by the Group companies Böhler Edelstahl GmbH & Co KG, Austria, and Uddeholms AB, Sweden.
The technology and capital goods group voestalpine plans to increase its revenue in the NAFTA region from the present EUR 1.2 billion to EUR 3 billion by 2020. A new USD 500 million order for its automotive sector brings the company one step closer to this goal. To be able to fulfill this large order from a German premium automotive manufacturer, voestalpine invests more than USD 60 million in two US sites. On the one hand, the automotive component plant in Cartersville, Georgia, opened in 2014, is already entering the third expansion stage, and on the other, the Group is investing in a new site in Birmingham, Alabama. voestalpine thus creates a total of over 400 jobs at these two locations by 2020.
The development of the financial key figures of the voestalpine Group in the first quarter of the business year 2016/17 (April 1 to June 30, 2016) reflects the significant non-recurring effects in the first quarter of 2015/16, as well as the economic environment that continues to be difficult. Furthermore, the current weaker figures are being compared to the first quarter of 2015/16, when operating results were well above average.
voestalpine and VERBUND, two of Austria’s largest industrial corporations and ecological pioneers in their respective industries, will step up their collaboration in the future with strategic cooperation projects. In addition to new concepts for long-term electricity supply by VERBUND for individual voestalpine locations, they will include more flexible concepts in the areas of generation of electricity and power requirements, exploring possible photovoltaics projects at voestalpine locations in Austria, and R&D collaboration in the future-oriented utilization of hydrogen.
The voestalpine Group continues to drive its activities in the NAFTA region. As part of these efforts, just last week the Metal Forming Division’s voestalpine Rotec GmbH acquired Summo Corp., headquartered in Burlington, Canada. Summo is regarded as a state-of-the-art manufacturer of high-quality tube components for the automotive industry, which is an outstanding addition to the high-quality voestalpine product portfolio in the automotive safety components sector.
Technology and capital goods group voestalpine continues to power ahead with its expansion in the automotive sector. At its site in Schwäbisch Gmünd, Germany, in close proximity to many automotive customers, the company has set another milestone in lightweight automotive construction: with the opening today of the world’s first phs-directform® facility, it is now possible to produce press-hardened, ultra high-strength, and corrosion-resistant body-in-white parts from galvanized steel strip in a single step (direct process). This technology is the first of its kind in the world, and meets the automotive industry’s most sophisticated demands for even lighter, stronger, and therefore safer components, manufactured using a highly efficient process.
Today, at the 24th Annual General Shareholders’ Meeting of voestalpine AG, a dividend of EUR 1.05 for each dividend-bearing share was approved for the business year 2015/16. The shareholders acted on the relevant recommendation by the Management Board and the Supervisory Board. After a dividend of exactly one euro in the previous year, this represents another five-percent rise and follows continual increases in the previous periods. Despite the economically challenging times, the dividend once again confirms the attractiveness of the Group’s dividend yield to shareholders. The dividend shall be paid out starting on July 18, 2016 (ex-dividend date is July 14, 2016).
The voestalpine wing will again be at the center of racing activity at the Austrian Grand Prix this weekend, both as an architectural highlight and the gateway to the Red Bull Ring. voestalpine and Projekt Spielberg have now extended their cooperation concerning the multifunctional welcome and event center for a further two years. Key factors in deciding to continue voestalpine’s presence in Spielberg included not only the international reach achieved by major events such as Formula 1, but also the Group’s clear commitment to Styria, the home of nine voestalpine sites and a workforce of over 9,000 employees. With the starting signal sounding for the next round of the voestalpine wing, the company is again highlighting its strategic focus on the future-oriented mobility sector. Already 48 percent of Group revenue is generated in this growth area – a figure which is set to rise further.
Just a few months prior to completion of the new voestalpine direct reduction plant in Corpus Christi, Texas (USA), another major customer has been won: an offtake agreement has been signed with the new American steelmaker Big River Steel to run for the next four years, securing the US company’s supply of hot-briquetted iron (HBI). In future voestalpine will produce roughly two million tonnes of this high-quality steelmaking prematerial annually at the new location in Texas.
In the business year 2015/16 (April 1, 2015 to March 31, 2016), the voestalpine Group has again proven its very specific position on the market despite an economic environment made extremely challenging by the dramatic slump in the oil and natural gas sector and global price deterioration for steel commodities, primarily due to enormous overcapacity in China. Notwithstanding these difficult framework conditions, the voestalpine Group was largely able to maintain its revenue at the previous year's level: roughly EUR 11.1 billion compared with EUR 11.2 billion (−1.1%).
The Gotthard Base Tunnel in Switzerland, at 57 km in length the longest railway tunnel in the world, will be officially opened on June 1, 2016. voestalpine has played a key role in the realization of this record-breaking project of SBB (Schweizerische Bundesbahnen) right from the start: As a capital goods group with a clear product focus in the railway infrastructure sector, voestalpine has supplied all 43 high-performance turnouts for the two new tunnel tubes, as well as 18,000 tonnes of rails, each measuring 120 m in length. By successfully concluding this major order, voestalpine once more highlights its position as a global market leader in both turnout technology and special rails. In the business year 2014/15 the Group generated 47 percent of its total revenue in the growing mobility market, with 12 percent in the railway systems sector alone.
Construction of the voestalpine direct reduction plant in Corpus Christi, Texas, which is the largest foreign investment made by the Group or an Austrian company in the USA to date, is reaching its final stages. The last phase of plant assembly, including implementation of the process and control engineering, is taking place in parallel with test runs on selected equipment and systems. From today’s perspective, it can therefore be expected that the plant will go into operation largely as planned during summer 2016. From the beginning of the next business year the new plant will produce two million tonnes of high quality HBI (hot briquetted iron, or “sponge iron”) annually, a sophisticated pre-material for steel production. This represents another important step in voestalpine’s expansion in the NAFTA region. The voestalpine Group already has 64 sites and around 3,000 employees in the region and generated revenue of around EUR 1 billion during the past business year.
voestalpine has secured a major new contract in the ongoing economically challenging oil and gas industry for the Nord Stream 2 pipeline project between Europe and Russia. After having supplied 170,000 tonnes highest-quality linepipe plates for the first part of the offshore gas pipeline in the Baltic Sea between 2008 and 2010, the Group will now produce several hundred thousand tonnes for Nord Stream 2. The order quantities significantly exceeded expectations, which makes this order the largest one won by voestalpine Grobblech GmbH in the company's history.
With the purchase of Advanced Tooling Tek (ATT) in Shanghai, China, and the Sermetal Group in Barcelona, Spain, voestalpine is enhancing its global leadership position as a producer of special steels. Both companies are specialized in the processing and sale of special steel products for tool and mold-making, a segment whose main customers are the automotive and electronics industries. Together ATT and the Sermetal Group have around 160 employees and generated a total revenue of around EUR 43 million in 2015.
Construction of the voestalpine direct reduction plant in Texas, USA, is proceeding rapidly. Initial tests on sections of the plant have already commenced so that from today’s standpoint it can be assumed that production will start this summer, largely as planned. In future the Group will produce high-quality HBI (hot briquetted iron, or sponge iron), a sophisticated pre-material used in steel production, at the new site near Corpus Christi. Market demand for voestalpine HBI remains high. After having successfully secured long-term supply contracts with prestigious customers over the past months, voestalpine has recently signed another purchase contract which runs for several years with Mexican steel producer TYASA for several hundred thousand tons of the sponge iron from Texas.
Europe's most advanced rollforming line officially goes into operation at the voestalpine site in Krems today. It will produce highly-complex special tubes and sections for customers in sectors including the automotive and commercial vehicles industries. voestalpine has invested over five million euros in the new line, strengthening its position as the global market leader in the production of top quality complex, cold-rolled steel tubes and sections.
Although the economic environment became increasingly more challenging during the course of the year, the voestalpine Group successfully held its ground in the first nine months of the business year 2015/16 (April 1, to December 31, 2015). Revenue rose compared with the same period of the previous year by 1.5%, going from EUR 8.3 billion to EUR 8.4 billion; at the same time, earnings increased, even when non-recurring effects are excluded.