05. April 2016
Annual press conference 2016
The Dillinger Group (Aktien-Gesellschaft der Dillinger Hüttenwerke with its subsidiaries) improved its production and sales volumes in 2015, despite challenging economic conditions and an extremely competitive heavy plate market. “Thanks to more favorable prices for raw materials required to make steel and our consistent cost-cutting policy, the Dillinger Group was able to achieve an operating profit despite a decline in sales. This is the result of intensive internal efforts and numerous optimization measures, which we still cannot afford to let up on,” said Fred Metzken, Spokesman for the Board of Directors of Dillinger Hütte, at the annual press conference.
The heavy plate market remained extremely competitive in 2015 and, as in the previous year, was also marked by major structural problems. Factors defining the past financial year included insufficient and further declining utilization of capacities at the European Steel Association (Eurofer) plants, at below 60 %, massive overcapacities and a sharp increase of imports in the EU market. These led to sustained, aggressive predatory competition and enormous pressure on revenue and margins, which further intensified during the year and led to a decline in sales at the Dillinger Group. Falling oil and gas prices also resulted in weak demand on the energy market – the primary sales market for the products of the group of companies. The pipe plate segment in particular suffered from the weak project business in the large-diameter line pipe market.
Exceedingly problematic conditions are expected to continue for the heavy plate market. Aggressive predatory competition continues to dominate at the start of 2016, low gas and oil prices are significantly hampering investment in the energy market, and ongoing overcapacities and high imports are placing intense pressure on prices, which have reached an extremely low level. In light of the implementation of anti-dumping measures by the European Commission, in the second half of 2016 European heavy plate manufacturers expect the heavy plate market to recover somewhat from its current disarray.
It is therefore imperative that public policymakers set a prudent course with trade and climate policies. Short decision-making paths for effecting antidumping measures, fair market practices and comparable statutory requirements for reducing carbon emissions are needed to prevent the threat of de-industrialization in western Europe.
The Dillinger Group began the year with good utilization of capacities and expects total sales volumes to be at the previous year’s level. In the Production division, 2016 will be marked by the relining of Blast Furnace 4 and the associated relining from July to September. It is hoped that the inadequate price level will recover somewhat in coming months; however, the Dillinger Group anticipates a significant decline on the whole in net sales and a corresponding effect on earnings.
The new “Dillinger” brand identity, being presented for the first time at the annual press conference, is aimed at more sharply defining the brand identity and strengthening the brand’s core values – quality, reliability and partnership. This reinforces the “Dillinger” umbrella brand as a unit within the group of companies and as a distinguishing feature in contrast with the competition.
Head of Public relations
Tel.: +49 6831 473011
Fax: +49 6831 474209
Tel.: +49 6831 472002
Fax: +49 6831 474209
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