Dillinger Hütte: Good year in 2011 with high utilization of plant capacities and outstanding investments

• Increase in consolidated revenue to € 2.8 billion
• Good earnings situation: Consolidated EBIT amounted to € 205 million and EBITDA to € 304 million.

The 2011 financial year was a good one for the Dillinger Hütte Group (Dillinger Hütte and its subsidiaries). Higher sales volumes and an improved revenue level led to an increase in consolidated revenue to around € 2.8 billion compared with the previous year (€ 2.1 billion). “The Dillinger Hütte Group looks back on a good 2011 financial year: We were able to improve both our sales and our earnings from operations, and with the new CC 6 continuous casting machine and the Steelwind Nordenham project, we’ve decided in favor of two outstanding investments,” Chief Executive Officer Dr. Karlheinz Blessing said during the annual press conference.

Recovery of the heavy plate market slowed at midyear

The recovery of the heavy plate market continued until the middle of 2011, and demand initially surged. In the course of the economic slowdown, however, demand on the heavy plate market began to fall off again beginning in summer. Prices came under pressure during the course of the year, particularly where commodities were concerned; 2011 prices in the specialty areas could be maintained at a stable level.

Dillinger Hütte: High utilization of plant capacities – sales increased

The 2011 financial year at Dillinger Hütte (DH) as a whole was marked by consistently good utilization of production facility capacities and a good level of incoming orders, which began to slow in the 4th quarter, particularly in the pipe plate segment.

Production at the rolling mills in Dillingen and at the wholly owned subsidiary,GTS Industries S. A. in Dunkirk, France, reached 2,110 million tons, compared with 1,882 million tons in 2010. In all, Dillinger Hütte shipped 2,104 million tons of heavy plate (2010: 1,881 million).

Higher sales volumes and an improved revenue level led to an increase in consolidated revenue to around € 2,753 billion, compared with the previous year (€ 2,110 billion).

Good earnings situation

Direct comparison of the key financial figures for 2011 with those of the previous year is only possible to a limited degree due to the positive impact in the previous year of the new accounting criteria in Germany (Act to Modernize Accounting Law [BilMoG]) and extraordinarily high income from investments marked by special effects. Consolidated earnings before interest and taxes (EBIT) amounted to € 205 million (2010: € 368 million) and consolidated earnings before interest, taxes, depreciation and amortization (EBITDA) was € 304 million (2010: € 458 million). Despite a drop in EBIT and EBITDA, earnings from operations improved 39 % over the previous year. Consolidated return on sales (EBIT margin) amounted to 7.4 % (2010: 17.4 %) and the return on capital employed (ROCE) was 6.4 % (2010: 12.1 %).

Employee numbers rose once again – high training rate

A total of 5 464 people were employed at the Dillingen location at the end of the financial year (Dec. 31, 2010: 5 412). These employees worked at Dillinger Hütte itself, at Zentralkokerei Saar GmbH (ZKS) and at ROGESA Roheisengesellschaft Saar mbH (ROGESA). Compared with the previous year, this amounts to an increase in the workforce of 52 employees (+ 0.96 %). A total of 8 214 employees are employed within the Dillinger Hütte Group (2010: 8 072). The company hired 73 new trainees in 2011 (previous year: 63) and employed a total of 260 trainees when all training classes are included.

Increased investment activity

At € 95 million, total investment was once again significantly higher than during the previous year (€ 73 million). A total of an additional € 57 million (previous year: € 120 million) was invested in both indirect subsidiaries ROGESA and ZKS at the Dillingen location. Dillinger Hütte bore half of these investment costs, in proportion to its shares in the companies.

Forecast for 2012: Dillinger Hütte expects a stable year despite difficult circumstances

Given the major uncertainties that characterize the economic situation, the Dillinger Hütte Group expects 2012 to be a difficult but stable year overall. Even though the situation in the pipe plate product segment is currently fraught, good demand is expected for the year as a whole for normal plate from other important consumer segments and for the rest of the year for pipe plate as well. Overall, Dillinger Hütte expects normal utilization of capacities for 2012 and assumes that sales and earnings will be of a dimension similar to those of 2011.

The Dillinger Hütte Group by the numbers: