Voestalpine EBITDA Falls Amid Uncertain Macroeconomic Environment
The Voestalpine Group in Linz, which produces flat products for the automotive, energy and rail industries, reported that its underlying EBITDA fell 28 percent to € 370.9 million (approximately US $ 415.6 million) in the second quarter from 513.0 million euros a year earlier. The company still believes that EBITDA will remain flat on average in the 2019-20 fiscal year ending in March, but the report says the task has become more difficult as the “macroeconomic environment has become more uncertain” since March. Greater efforts are required to reduce costs and improve efficiency.
The steel sector in Europe is primarily affected by the slowdown in the development of the automotive industry, one of its main consumers, and steel imports are growing after the introduction of tariffs in the United States. ArcelorMittal, the world's largest steelmaker, cut its forecast for global steel demand last week. Profitability was also limited by declining steel prices and higher raw material costs, especially iron ore.
"The Management Board of Voestalpine AG continues to work in difficult conditions associated with changes in prices for ore and steel and the need to maintain EBITDA in the current fiscal year, comparable to the previous year, despite the increased level of uncertainty since the beginning of the fiscal year," - said in message.