Austrian steelmaker Voestalpine offered to cut its dividend by 21.4 percent in fiscal 2018/19 after the company's operating profit fell by a third due to weak demand from automakers, increased competition and problems at US plants.
The European steel sector has found itself in a difficult situation, after the slowdown in the continent's auto industry, falling oil prices and falling demand for steel from the oil industry, amid growing imports redirected from the US market following US tariffs.
ArcelorMittal, the world's largest steel producer, highlighted concerns when the company cut production a second time last month, citing weak demand and strong imports.
"Despite the fact that the Group managed to achieve success against the background of a significant cooling of the economy in terms of increasing revenue, its profit indicators significantly lagged behind the results of the previous year due to external and internal negative factors. "
Voestalpine has offered to pay a dividend of € 1.10 (approximately $ 1.24) on share for FY18 /19 compared with 1.40 euros in the previous year after profit before interest and taxes (EBIT) fell 33.9 percent to 779.4 million euros. The company's revenues hit a record high of 13.6 billion euros last year, but revenues are forecast to fall significantly this year.
