Hoganas sees sales growth dip

Hoganas sees sales growth dip

Swedish global iron and steel powder producer Hoganas released its January-September 2005 interim financial report. Excluding copper operations, the company posted net sales of 3.38 billion Kronor ($426.17 million) through the first nine months, up 16 percent year on year. The growth in sales is lower than the figures in 2004 due to the weaker global market in 2005. Hoganas' income after tax for the first nine months was 215 million Kronor ($27.1 million). The company attributes the drop in sales growth mainly to the slow down in car sales in the US and Western Europe; growth in Asia and South America was unable to offset those downturns. The company plans to close down its older facility in Brazil in a few years, and the company will also shut down one of Pyron's production lines in the US. Furthermore, some machinery will be removed from UK and Chinese facilities because those lines will not be used. The company also indicates that the imbalance between raw material costs and price surcharges adversely affected the company's year to date income. Market prices for scrap in particular rose in the third quarter; on the other hand, nickel saw a decline. Hoganas will reconsider its pricing policy and renovate its facilities. The company also plans to increase its sales in Asia and South America.