Dillinger Hütte with record results in 2005

“2005 was a very successful year for us and our production lines were running at a very high capacity during the whole year. Thanks to the high flexibility of all production units and the process optimisation we continued to improve our product mix toward more sophisticated and higher-value qualities in spite of the fact that our installations were running at full capacity, says Michel Maulvault concerning the company’s very good figures for 2005. “Without the competence and the commitment of our qualified and motivated personnel such a performance as carried out in 2005 cannot be realised", he continues.

Good situation on the heavy plate market

In 2005, the European heavy plate market was broadly characterised by a strong demand on the part of heavy plate manufacturers, especially from all energy sectors. This led to a particularly high stimulation of the demand for tube plates since the tube mills benefited from increasing pipeline construction projects and growing drilling activities for oil and gas. Due to excessive stock screws were put on the market for normal plates was during the course of the year, and the prices decreased significantly in the field of simple qualities. The market price for higher-value qualities as well as tube plates, however, remained stable on a high level.

Record turnover realised

With 2.347 million tons the rolling mills’ output surpassed the previous year’s performance by 7.8%. 1.556 million tons (+11.8%) of heavy plates were produced in Dillingen and 791,000 tons (+0.8%) at the 100% subsidiary GTS Industries in Dunkirk. The sales of heavy plates increased by 1.8% to 2.271 million tons compared to the previous year (2.230 million tons). Thanks to the positive revenue development in Dillinger Hütte’s product groups - normal and tube plates - as well as the still high volume level, a turnover of more than € 2 billion was realised for the first time.
The revenue increased by 37% to € 2.1 billions compared to € 1.5 billions in the previous year.

Clear improvement of results

Dillinger Hütte reached new heights in its results in spite of the still increased expenses for raw material. The net income before profit and loss transfer amounted to € 202.6 millions (€ 50.3 millions in 2004). EBIDTA, earnings before interest, depreciation , taxes and amortisation, was € 247.0 millions compared to € 83 millions in 2004. In addition to the good volume and revenue development the ongoing programme for the improvement of results, DH-TOP 2007, also contributed to these very good results.

Priority on work safety and training

In 2005, total personnel decreased by 0.8 % compared to 2004 (5292 employees vs. 5332 employees). Systematic efforts led to a decrease of notifiable accidents to 47 (2004: 74). The main priority is put on work safety in order to further decrease the number of accidents and to guarantee safe work. With 295 trainees at the end of 2004 (2003: 284) Dillinger Hütte maintains its high level of trainees and it is one of the biggest apprenticeship facilities at the Saar. For the years 2005/2006 the company again employed 84 trainees (2004: 90).

Constantly high investments in modernisation

Investments of € 32 millions in the 2005 financial year (€ 48 millions in 2004) were mainly used to further strengthen the technology competence and to optimise processes in the company. In 2005, an important focus was put on the improvement of environmental standards at the location in Dillingen. Besides the above mentioned expenses, important projects were launched or approved, such as the sanitation of Zentralkokerei Saar (Dillinger Hütte's participation: 50%) or the modernisation of the emission control systems at the sintering plants of ROGESA Roheisengesellschaft Saar (Dillinger Hütte’s participation: 50%).

Positive outlook for Dillinger Hütte in 2006

Within the background of a continuously high demand on the part of the energy sector, the prospects on the heavy plate market are good for 2006. The important industries that manufacture heavy plates, such as the producers of big tubes, the offshore industry and mechanical engineering, record positive employment trends.
At the beginning of the year Dillinger Hütte also profits with its products from the good situation on the heavy plates market. Thus, the installations are running at high capacity in the first half of the year and generally good revenues for the company's products are still expected. But on the cost side further increases in prices for raw materials and transport are anticipated. Seen from today, the 2006 financial year will be marked by a good plant utilisation, a still high turnover volume and a good financial result. The ongoing programme for the improvement of results, DH-TOP 2007, will also contribute to this. The programme's objective is to substantially increase the profitability of Dillinger Hütte on a long-term basis. With the help of state-of-the-art installations and constant research and investment activities Dillinger Hütte continues its strategy of a consequent orientation towards more sophisticated and higher-value qualities and a balanced product and country mix.