Danieli announces €192M net profit

Plantmaker Danieli & Co, headquartered in Buttrio, North East Italy, but through acquisitions and investments with manufacturing facilities in all major steelmaking countries, announced a net profit of €191.7M to June 30th 2011. Plantmaking contributed €171.9M to this figure, steelmaking €19.69M and construction, finance and services the remainder.

Gianpietro Benedetti, Chairman and CEO said net profit was down 5% on the previous year largely due to the loss of anticipated income resulting from the upheaval in MENA countries which forced Danieli to close activities in Egypt and Libya and experience a general slowdown of business in the region.

Revenues were up 21% at €3128.6M and EBITDA grew 27% to €359.2M resulting in a profit before tax of €265.5 up 10% y-o-y. However, tax payable for the year was €73.8M compared with €40.6M in 2009/10 resulting in the fall in net profit. The plantmaking division contributed €2309.2M to revenues.

Global steel consumption was up 8% and global performance had been good in the first half of the year but has since slowed in Europe and North America, but he believes it will recover again in the second half of 2012 or early 2013.

Prospects in the BRIC countries remains good. For 2011-12 there is a good backlog of orders worth €3387M able to keep Danieli’s workshops busy into the future. Equipment for long products represents 29% of the order book, steel meltshop 21%, 18% flat products and 11% steelmaking. Other projects account for the remaining 21%.

The company is growing its portfolio with the formation of Danieli Linz in Austria which will enable the company to expand further into designing and building oxygen converters, an area previously only served with auxiliary equipment by Danieli Corus.

Danieli UK has also been established within Danieli Fröhling to build hot and cold strip rolling mills for aluminium.

Capital expenditure during the year included €45M spent at the headquarters in Buttrio on new machines in the workshop and in the R&D facilities.
The design and service centre in Chenai, India is being expanded to include a heavy workshop for the fabrication of equipment and new engineering offices built. The total investment will be €60M.

In Shanghai, the workshop area is being increased by 40%.

In Vietnam, a technical office is being established at a cost of €8M.

In Russia, €20M is being spent in a first phase building of workshops and a further €40M is allocated for Phase 2.

This year Franco Alzetta, COO Engineering and Plantmaking took the lead role in presenting the results with Mr Benedetti presenting the future strategic plans of the company.

Danieli now has companies based in 11 countries across the world and offices and/or centres to service its equipment in 16.

The number of employees in the plantmaking division grew 8.5% during the year to 8304, largely as a result of expansion in China but there was also some net increase in all regions. The number in the steelmaking division (ABS) grew by 74 employees to 1088.