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voestalpine AG / Difficult environment has adverse impact on voestalpine?s results for the first half of the business year 2019/20
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Corporate news transmitted by euro adhoc with the aim of a Europe-wide
distribution. The issuer is responsible for the content of this announcement.
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Corporate news transmitted by euro adhoc with the aim of a Europe-wide
distribution. The issuer is responsible for the content of this announcement.
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Mid Year Results
Linz - For the voestalpine Group, the first half of the business year 2019/20
was defined by a substantial dampening of sentiment in its economic environment.
Particularly in Europe, where voestalpine generates about two thirds of its
revenue, the weakening of the export industry due to increasing global barriers
to trade, decreasing demand from the automotive industry as well as fewer
investments affected all of the Group's divisions. But the global trade disputes
are being reflected in declining economic momentum in China and the United
States too. The adverse conditions in the steel sector intensified all the more
on account of massive increases in raw materials prices in tandem with
decreasing sales prices and large volume steel imports into Europe that continue
unabated. Furthermore, the financial expenditures for CO2 allowances in the
European Union as well as the corporate issue of start-up costs at the Group's
Automotive Components plant in Cartersville, Georgia, USA, continued to have
adverse impact on the profit margins.
Under these conditions, there was a decline in all earnings categories of the
voestalpine Group in the first half of 2019/20. As measures to stabilize
earnings, the cost-cutting and efficiency improvement programs already
implemented were further intensified.
Nevertheless, in this generally difficult macroeconomic environment, the
technology segments railway systems, aerospace, warehouse and rack-solutions as
well as welding technology recorded a stable, positive development, confirming
the strategic orientation of the voestalpine Group as a special and complete
system provider.
Investments reduced
Having made large investments in recent years, the voestalpine Group is cutting
back on its investment activity, reducing its investment volume in the first
half of the year by almost 30% to EUR 338 million (EUR 475 million a year
earlier).
Balance sheet structure affected by non-recurring items
The voestalpine Group's reported indebtedness in the first half of 2019/20 was
materially affected by accounting factors in addition to the operating
developments and the dividend payment. For one, the interest-bearing liabilities
rose by around EUR 437 million on account of a change in the International
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