Austrian steelmaker voestalpine AG has announced its financial results for the first quarter ended June 30 of the financial year 2016-17.
Accordingly, voestalpine's net profit in the given quarter amounted to €105.8 million, down 63.5 percent compared to the first quarter of the previous financial year. The revenues of the company amounted to €2.77 billion, down 7.6 percent year on year, primarily due to deteriorating demand in the oil and natural gas sector that became increasingly apparent in the course of the year. In the given period, the company's EBITDA was €333.9 million, decreasing by 36.6 percent year on year, while the EBITDA margin stood at 12 percent compared to 17.5 percent in the same period of the previous year.
According to the company’s statement, in comparison to the previous year, which reported a considerably weaker second half of the business year, a marked increase is expected in the course of the financial year 2016-17 both with regard to operating result (EBITDA) and profit from operations (EBIT). Three major factors are driving this development. First, there is a time-lag in the effect of the positive price trend in the longer-term contract-based steel business; second, the start-up costs of the direct reduction plant in Texas will taper off in the course of the year; and third, an easing of the situation in the oil and natural gas sector is expected toward the end of the business year.