After a phase of consolidation in the wake of the financial crisis, the business year 2012/13 marked intensified investment activity by the Group as it began to implement its “Strategy 2020.” These activities continued in the third quarter of 2013/14 as voestalpine seeks to ensure its leading position with regard to high standards of technology and quality on one hand and, on the other, to accelerate its orientation specifically toward growth markets. Against this backdrop, investments in the first nine months of 2013/14 increased in comparison to the previous year by one third, rising from EUR 498.4 million to EUR 664.3 million.
Compared to the previous year, investment expenditure of the Steel Division in the first three quarters of 2013/14 surged by 82.5% from EUR 188.3 million to EUR 343.7 million. The focus of these investments was on measures to optimize maintenance and improve efficiency in the production of crude steel and on measures to increase quality even further and expand the premium quality product portfolio in the rolling segment—all at the Linz/Austria site: renewal of the cowpers on main blast furnace A, construction of a new coal injection system on all three blast furnaces, preparations for start-up of operations of the continuous annealing line 2 for the production of premium quality electric strip, construction of the new heavy plate/rolling stand for the production of ultra high-strength heavy plate. Construction of the direct reduction plant in Corpus Christi, Texas/USA is on schedule and precisely within the budget. The required construction and environmental permits have either already been issued or are currently in the end phase of the permissions process.
The investment volume of the Special Steel Division in the first nine months of 2013/14 was at EUR 108.7 million, 18.3% higher than the previous year’s figure (EUR 91.9 million). The four-year project on optimization of quality and productivity and improvement of occupational safety and environmental protection in the special steel plant in Wetzlar/Germany is currently focused on expansion of facilities for heat treatment of drop forgings. The expansion in capacity for producing powder-metallurgical steels at the Kapfenberg/Austria site was launched in the second half of 2013. Within the scope of optimization of global distribution of tool steel, high-speed steel, and special materials, the distribution center in Kapfenberg was expanded. Furthermore, in important sales regions, measures are currently being implemented to expand services, such as heat treatment, pre-processing, and coating.
In contrast to the other divisions, the Metal Engineering Division scaled down its investments compared to the previous year by 12.4% from EUR 123.0 million to EUR 107.7 million. The single most extensive project as far as volume is concerned is the construction of a new wire rod mill at the Donawitz/Austria site that will replace the existing rolling mill; this mill will be a state-of-the-art facility and the most modern plant of its kind in Europe. Other current investment projects at the same site are a new walking beam furnace for rail production and the (scheduled) major repair of one of the two blast furnaces.
At EUR 99.0 million, investments in the Metal Forming Division were 10.9% above those in the same period of the previous year (EUR 89.3 million). The main focus of activity is the internationalization strategy. In the Automotive Body Parts business segment, work is focused on the new “phs-ultraform” product segment (press-hardened steels based on new technology). The necessary buildings and facilities in the USA, South Africa, and China were completed during the past months and are all in the start-up phase at this time. In addition, two similar facilities were already put into operation in Germany in the third quarter of 2013/14. The Tubes and Sections business segment is currently building a new sections plant in China that is scheduled to begin production of special sections for international customers in the early part of the next business year.