Danieli foresees world steel capacity utilisation declining in the fiscal year through 2020 (FY20) after rising 3 percentage points on-year in FY19 to 81%. The technology supplier says the steel market will remain stable or show a slight drop due to the ongoing negotiations on duties.
The steel market downturn is difficult to quantify because of geo-economic and political tensions, the firm observes. Its order-book stands at €3,099 million ($3,381m) compared to €2,954m at end-FY18.
In FY19 Danieli’s revenue rose 13% on-year to €3.06 billion, with net profit up 15% to €66.8m.
The firm’s Steel Making segment saw increased volumes thanks to the restart of ABS Sisak’s steelmaking unit and in spite of losses at the ESW Röhrenwerke pipe mill. Danieli is “…determining appropriate corrective actions” for the latter, it says in a report monitored by Kallanish. Segment volumes reached 1.32 million tonnes in FY19. However, in the next few months the segment will experience a drop in demand, particularly in the automotive and oil and gas sector.
Besides ABS Sisak and ESW Röhrenwerke, the segment includes Italian steelmaker Acciaierie Bertoli Safau (ABS).
“The Plant Making segment was less affected by the serious crisis that steelmakers experienced in 2016, 2017 and 2018, which significantly reduced not only investments but also the purchase prices of new plants,” Danieli observes. Demand for new plants is good but selling prices are still not very profitable due to fierce competition from Germany and Japan.