The sovereign debt crisis, the euro crisis, the growth crisis, and production overcapacities have caused the economic mood to darken. Against this background, downward trends have been detected even in the economies of Northern and Western Europe, which had been stable thus far, while the economic landscape in Southern Europe continues to drift at a very weak level. Additionally, the signs suggesting a slackening of the exceptionally dynamic economic development in the threshold countries, which are so important for global economic growth—particularly, China, Brazil, and India—have recently been confirmed. The voestalpine Group and its key customers cannot remain unaffected by this trend. A direct comparison of the key figures with the last quarter of the previous business year 2011/12, however, shows revenue that has declined only slightly (EUR 3.181 million, Q4 2011/12) and stable operating profit as reflected by both EBITDA and EBIT. At more than 46,000, the number of employees also remained the same.
The uncertainty on the part of market participants resulting in more cautious order patterns affected the individual industries to varying degrees. While the European automotive industry’s mass market was confronted with massive declines in sales, affecting many of the manufacturers, demand in the premium segment—particularly in Germany—(still) remained high as of the middle of the year. Demand from the energy exploration, mechanical engineering, and aviation sectors was still relatively robust, and the market environment in the railway infrastructure segment also remained largely constant. In the rail sector, it was the high quality segment (premium grades) that sustained its performance. The market for standard rails continues to be dominated by overcapacities and price wars. Most recently, there were signs for a slight recovery in the white goods and consumer goods industries, however, the construction and construction supply sectors continue to stagnate at a low level in most countries.
The unfavorable macroeconomic environment has brought changes to the European steel market in particular. While demand and price trends in the first quarter of the previous year were still affected by a strong recovery due to the more positive growth expectations, the market environment in recent months has been characterized by falling demand, prices that have been trending down, and massive structural overcapacities. The trend in the three processing divisions was much more stable; while they also experienced declines, they were relatively moderate.