ANNUAL REPORT 2000/2001

Full text

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VOEST-ALPINE STAHL AG

ANNUAL REPORT 2000/2001

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2,456.1 350.6 221.2 236.7 223.2 2,178.3 189.4 206.8 129.4 943.6 218.5 23.2 % 16.0 % 14.3 % 9.0 % 15,059 4.55 693.0 33,000,000 21.00 -0.94 -1995 HGB EUR millions 1996 HGB EUR millions 2,290.6 258.1 123.2 147.6 122.7 2,292.7 298.2 329.2 134.9 1,022.2 196.5 19.2 % 8.5 % 11.3 % 5.4 % 14,795 4.05 924.0 33,000,000 27.99 3.72 0.87 -2,711.7 354.3 153.0 163.9 128.9 3,123.3 259.3 292.5 201.3 1,430.0 286.4 20.0 % 7.8 % 13.1 % 5.6 % 15,228 4.79 1,072.5 33,000,000 32.50 3.91 1.20 -Turnover Operating result

before depreciation (EBITD)

Operating result (EBIT)

Result from

ordinary activities (EGT)

Net profit

Balance sheet total

Cash-flow from operations

Investments in tangible and intangible assets and interests

Depreciation

Shareholders’ equity

Net financial debt

Net financial debt as a % of equity

Return on Capital Employed (ROCE)

EBITD margin

EBIT margin

Employees excl. apprentices (period end)

Crude steel production (in million metric tons)

Market capitalization period end Number of shares End of period share price Earnings/share (EPS) Dividend/share Bonus/share 2,518.0 339.9 166.2 152.8 118.7 2,838.1 448.6 276.4 173.7 1,272.4 133.0 10.5 % 10.6 % 13.5 % 6.6 % 14,416 4.85 1,367.0 33,000,000 41.42 3.60 1.09 -1997/1998 IAS EUR millions 1998/1999 IAS EUR millions 1999/2000 IAS EUR millions 2000/2001 IAS EUR millions 3,166.1 478.1 258.3 247.1 179.1 3,401.2 388.7 319.0 219.8 1,529.5 251.7 16.5 % 12.1 % 15.1 % 8.2 % 15,658 5.30 967.7 31,676,700 30.55 5.60 1.20 1 ) 0.70 1 ) K E Y F I G U R E S

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2,581.9 356.6 167.8 147.1 108.4 3,071.3 362.3 429.7 188.7 1,343.8 244.2 18.2 % 9.0 % 13.8 % 6.5 % 16,179 4.70 947.5 33,000,000 28.71 3.28 1.20

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FLAT PRODUCTS DIVISION

- The EBITD margin of 16.5 % and the EBIT margin of 9.7 % represent new record values.

- The crude steel production at the site in Linz reaches 4 million metric tons for the first time.

- Emphasis is on the downstream strategy through the acquisition of the Swiss-Ger-man ROTEC Group, the investment in the Italian stamping and assembly plant TURINAUTO as well as the majority investment in the Italian tailored blanks manu-facturer EUROWELD.

- The investment in a third hot-dip galvanizing plant and a second strip coating facility in Linz is approved (total investment volume: EUR 142 millions).

- The business areas forge, heavy plate and logistics are spun-off.

- A new pre-finishing center commences operations, and

- The industrial center of expertise for mechatronics and automation is inaugurated.

LONG PRODUCTS DIVISION

- The EBITD margin of 12.1 % and the EBIT margin of 5.2 % are at record levels.

- The new LD compact steel mill in Donawitz achieves cost leadership within the inte-grated long products manufacturers.

- After a start-up phase of only six months the LD compact steel mill in Donawitz achieves record production.

- A record is achieved with the approximately 300,000 metric tons of seamless pipe produced in Kindberg.

VOEST-ALPINE STAHL-GROUP

- A turnover of EUR 3,166.1 millions, an operating result (EBIT) of EUR 258.3 mil-lions, an ordinary result (EGT) of EUR 247.1 millions and a cash-flow of EUR 388.7 millions represent historic record levels.

- The 5.3 million metric tons crude steel (a 10 % increase over the prior year) are a record volume, shipped volume increased by 5.5 % to 5.18 million metric tons.

- The EBITD margin of 15.1 % and the ROCE of 12.1 % correspond to the financial targets of VOEST-ALPINE STAHL-Group.

- Acquisitions in several European countries represent an additional push towards internationalization, a new investment in a company is anticipated.

- VOEST-ALPINE STAHL AG initiates the first Corporate Venture Capital Fund in Austria.

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S T R U C T U R E

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FLAT PRODUCTS

VOEST-ALPINE STAHL LINZ GMBH

VOEST-ALPINE STAHL AG

VOEST-ALPINE STAHLHANDEL GMBH

VOEST-ALPINE STAHL SERVICE CENTER GMBH

VOEST-ALPINE GROBBLECH GMBH

VOEST-ALPINE GIESSEREI LINZ GMBH

VOEST-ALPINE GIESSEREI TRAISEN GMBH

VOEST-ALPINE SCHMIEDE GMBH

LOGISTIK SERVICE GMBH

VOEST-ALPINE INDUSTRIAL SERVICES GMBH (50 %)

VOEST-ALPINE KREMS GMBH

VOEST-ALPINE KREMS FINALTECHNIK GMBH

SADEF N.V.

METSEC PLC

VOEST-ALPINE PROFILFORM S.R.O.

ROLL FORMING CORPORATION

PRÄZISIONS-PROFIL GMBH

VOEST-ALPINE EUROPLATINEN GMBH & CO KG

EUROWELD S.R.L. (51 %)

ROTEC GMBH

TURINAUTO S.P.A. (33 %)

LONG PRODUCTS

VOEST-ALPINE SCHIENEN GMBH & CO KG

VOEST-ALPINE STAHL DONAWITZ GMBH

VOEST-ALPINE AUSTRIA DRAHT GMBH

VOEST-ALPINE STAHLROHR KINDBERG GMBH & CO KG (50 %)

VAE AG (45.5 %)

VOEST-ALPINE KLÖCKNER BAHNTECHNIK GMBH (51 %)

VOEST-ALPINE ROHSTOFFHANDEL GMBH

VOEST-ALPINE ROHSTOFFBESCHAFFUNGS-GMBH

INTERNATIONAL SALES ORGANIZATION

VOEST-ALPINE EUROSTAHL GMBH SALES COMPANIES: BELGIUM DENMARK GERMANY FRANCE GREAT BRITAIN ITALY YUGOSLAVIA CROATIA NETHERLANDS NORWAY POLAND SWITZERLAND SWEDEN SLOVENIA CZECH REPUBLIC HUNGARY USA REPRESENTATIVE OFFICES: RUSSIA UKRAINE STATUS: 1/4/2001

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E X E C U T I V E B O D I E S O F T H E C O M PA N I E S

P r o f . D i p l . - I n g . D r. R U D O L F S T R E I C H E R

Chairman of the Supervisory Board of VOEST-ALPNE STAHL AG

Former Chairman of the Österreichische Industrieholding AG Managing Board

E m . o . U n i v. - P r o f . D r. h . c . R U D O L F S T R A S S E R

Deputy Chairman of the Supervisory Board of VOEST-ALPINE STAHL AG Johannes Kepler University of Linz

K R D k f m . D r. E R I C H B E C K E R

Member of the Supervisory Board of VOEST-ALPINE STAHL AG Chairman of the VA Technologie AG Managing Board

M a g . D r. J O H A N N E S D I T Z

Member of the Supervisory Board of VOEST-ALPINE STAHL AG Speaker of the Österreichische Industrieholding AG Managing Board

K R B e r g r a t h . c . D i p l . - I n g . D r. J O S E F F E G E R L Member of the Supervisory Board of VOEST-ALPINE STAHL AG Member of the Supervisory Board of MIBA AG

K A R L H A A S

Member of the Supervisory Board of VOEST-ALPINE STAHL AG General Secretary for the Trade Union of the Metal and Textile Sectors

K R D k f m . K A R L H O L LW E G E R

Member of the Supervisory Board of VOEST-ALPINE STAHL AG

Former Chairman of the Österreichische Industrieholding AG Managing Board

D r. S T E FA N K R A L I K

Member of the Supervisory Board of VOEST-ALPINE STAHL AG Notary Public

D r. J O A C H I M L E M P P E N A U

Attorney at law, Member of the Supervisory Board of VOEST-ALPINE STAHL AG Chairman of the Managing Boards of Volksfürsorge Holding AG,

of Volksfürsorge Deutsche Lebensversicherung AG, and of Volksfürsorge Deutsche Sachversicherung AG K R D r. L U W D I G S C H A R I N G E R

Member of the Supervisory Board of VOEST-ALPINE STAHL AG CEO of Raiffeisen-Landesbank Oberösterreich

E R H A R D K O P P L E R

Member of the Supervisory Board of VOEST-ALPINE STAHL AG (until 10/6/2000) Former Chairman of the VOEST-ALPINE STAHL LINZ GmbH Works Council H E L M U T O B E R C H R I S T L

Member of the Supervisory Board of VOEST-ALPINE STAHL AG Chairman of the VOEST-ALPINE STAHL LINZ GmbH Works Council

J O S E F K R O N I S T E R

Member of the Supervisory Board of VOEST-ALPE STAHL AG (since 10/6/2000) Chairman of the VOEST-ALPINE STAHL LINZ GmbH Works Council for Wage Earners

I n g . F R I T Z S U L Z B A C H E R Member of the Provincial Parliament

Chairman of the VOEST-ALPINE STAHL LINZ GmbH Works Council for Salaried Staff J O S E F G R I T Z

Member of the Supervisory Board of VOEST-ALPINE STAHL AG

Chairman of the VOEST-ALPINE STAHL DONAWITZ GmbH Works Council for Wage Earners

J O H A N N H E I L I G E N B R U N N E R

Member of the Supervisory Board of VOEST-ALPINE STAHL AG

Chairman of the VOEST-ALPINE STAHL AG Works Council for Salaried Staff

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E X E C U T I V E B O D I E S O F T H E C O M PA N I E S

President and Chairman of the Managing Board of VOEST-ALPINE STAHL AG

Areas of responsibility within the Group: International Sales Organization, M&A Activities Group Development

Strategic Human Resource Management (including top management) Group Communications

Audit

D r. P E T E R S T R A H A M M E R Born 1944, married, 3 children

Deputy Chairman of the Managing Board of VOEST-ALPINE STAHL AG Management of the Long Products Division

Areas of responsibility within the Group: Group Treasury

Sourcing Strategy D k f m . F R A N Z S T R U Z L Born 1942, married, 2 children

Member of the Managing Board of VOEST-ALPINE STAHL AG Management of the Flat Products Division

Areas of responsibility within the Group: Investor Relations

Legal and

Environmental Concerns R&D, Technological Strategy D r. W O L F G A N G E D E R Born 1952, married, 2 children

Member of the Managing Board of VOEST-ALPINE STAHL AG Areas of responsibility within the Group:

Financial Statements Controlling Taxes

Management Information Systems D r. W E R N E R H A I D E N T H A L E R Born 1944, married, 3 children M A N A G I N G B O A R D

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These are only a few chapters written as part of the success story of VOEST-ALPINE STAHL during the past business year. All are measures that are simply necessary for the company to defend or achieve its market determining positions in its chosen areas of performance. They are actions that are supported in an exemplary manner by each individual company member.

I am convinced that VOEST-ALPINE STAHL-Group, with its strategic measures to extend the value added chain and the continuous improvements in its product mix, is well prepared to make its mark in the difficult steel market of the future. Commit-ted to the principles of shareholder value, the company continues to recommend itself as outstanding to long- and medium-term investors.

I would like to take this opportunity to express my gratitude to all employees as well as to the management of VOEST-ALPINE STAHL-Group for the performance ren-dered. In the international steel business as well as on the capital markets in Europe and overseas their knowledge and willingness to perform are the most important pre-requisites for the successful activities of the Group of companies.

During the 2000/01 business year, VOEST-ALPINE STAHL-Group has once again proven its excellent performance reporting excellent key ratios. It is quite obvious that the Group of companies has undergone one of the most astounding developments in recent Austrian industrial history. The development from a former nationalized com-pany to a Group listed on the stock exchange that works very successfully is a suc-cess story widely noted nationally and internationally. It is the story of an institution that today is a renowned niche producer in the highest quality sector and furthermore the most profitable steel group in Europe.

This extraordinary positioning is due to a multitude of factors. First, the ability to re-cognize the constantly changing demands of the market rapidly, to create a corre-sponding environment to enable targeted actions, and to be the competent partner and reliable problem solver of the customers through the creativity of all employees “around steel”.

The Group, with its extraordinary strategic positioning in the center of Europe, today can no longer be viewed as solely a manufacturer of steel products of the highest quality, but ever more also as a supplier of components and systems offering full and just-in-time deliveries service to its business partners.

Another characteristic that distinguishes the Group is its consistent extending the value-added chain in coordination with its well balanced customer structure. Care-fully and in a controlled manner more milestones were achieved through acquisitions during the past business year, on a global level; in the automotive sector, for instance, through the investments in TURINAUTO and EUROWELD and through the acquisition of ROTEC.

During the modernization and optimization investments of the 2000/01 business year all employees with their extraordinary expertise once again showed how necessary work can be performed on time and at reasonable cost. Successfully. After all, the Group during the period under review produced its largest volume of crude steel and the best result in company history.

The next expansions in capacity are imminent in context with customer demands: the expansion of the tailored blanks production, the construction of a third hot-dip gal-vanizing plant and a second strip coating facility.

That the Group in its core business area strategy shows a very good sense for which areas are to be spun-off and when they should be spun-off so that they can approach the customer successfully as independent company is evident from the examples of recent years. Three new companies are currently being established.

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V O E S T- A L P I N E S TA H L A G · 2 0 0 0 / 0 1 15 This lengthens our value added chain in the third dimension. It is planned to expand

the business activities with TURINAUTO from its traditional customers to other Euro-pean automobile manufacturers and thus grow in EuroEuro-pean dimensions.

We have already reached this important interim goal in the tailored blanks produc-tion. The acquisition in the 2000/2001 business year of a 51 % interest in the Italian automobile supplier EUROWELD made VOEST-ALPINE EUROPLATINEN the number 2 in this segment in Europe.

The acquisition of the Swiss-German ROTEC Group is another important step in the upgrading towards the automotive industry. ROTEC specializes in particular in the manufacture of precision steel pipe used as ready-to-install pipe products in auto-mobile manufacturing.

We would like to point out here that the recent acquisitions give us additional satis-faction because through them we were able to realize an additional sales volume of approximately EUR 500 millions. In addition, these steps towards vertical integration help us to further mitigate the fluctuations of the business cycle.

However, our growth is not only fueled through acquisitions and the formation of part-nerships, we have also taken additional steps towards the implementation of the core business strategy of our Group within our own company. Areas of which we were con-vinced that they could be successful in the marketplace presenting their own identi-ty were spun-off. Effective 1/4/2000, the former business areas heavy plate, forge and logistics of ALPINE STAHL LINZ GmbH became the companies VOEST-ALPINE GROBBLECH GmbH (heavy plate), VOEST-VOEST-ALPINE SCHMIEDE GmbH (forge) and VOEST-ALPINE LOGISTIK SERVICE GmbH (logistics).

Our dynamic development towards becoming a steel processing group will also have to be reflected in the structure of our Group, which will have to be newly established, as well as in a modified image. Following the strategy towards smaller units, that are easier to keep track of and are therefore easier to guide it is planned to transition the activities concerning the automobile from the lead company VOEST-ALPINE STAHL LINZ GmbH into a newly established “automotive” division. Simultaneously, the busi-ness activities concerning steel sections and profiles with their global manufacturing sites will be pooled in a “steel sections and profiles” division. We are also working towards forming a new division “railroad systems” around the activities concerning the “steel track”. Subject to the approval of the boards the work on the new struc-ture of our Group will be completed at the end of September 2001.

The strategy of our actions will of course continue to include flexibility and the open-ness towards the new. Especially for us as a niche player innovation and

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The best year ever in our corporate history and the new positioning of our Group of Companies - this is the best opportunity for an extensive review and lookout.

During the 2000/01 business year we were able to continue the success story of our Group and to once again achieve new milestones. We have never before produced as much steel. We have never before achieved such high turnover. We have never before earned such high profits.

The key data for the 2000/01 business year are: steel production increased by 10 % to 5.3 million metric tons, turnover increased by 17 % to EUR 3.166 billions. The operating result improved in comparison with the previous business year by nearly 70 % to EUR 258 millions. This surpasses the result for the 1995 business year (EUR 221 millions), our best result to date.

The past business year has, therefore, become the best business year in the history of VOEST-ALPINE STAHL-Group; this in spite of the reversal in trend of the business cycle regarding price levels in the European steel industry during the fourth calendar quarter 2000.

The reasons for this success can be found on several different levels: first in the fact that the VOEST-ALPINE STAHL Group of companies is a medium-sized group with clearly defined operative units that are able to rapidly react to the corresponding envi-ronment and to quickly and flexibly adapt to customer demands. Furthermore, the Group and its consistent upgrading of products and services proves that such a com-pany policy can successfully counteract the cyclical downturns in the steel business cycle.

In addition, strict cost management and continuous increases in productivity are of the highest priority for the Group. It was once again possible during the past busi-ness year to achieve cost reductions amounting to EUR 43 millions within the CIP program (“Continuous Improvement Program”).

At the same time, the crude steel production of our company has exceeded the record mark of five million metric tons. These new production volumes were achieved through strict management of optimization in the existing plants in Linz and through the rapid start-up of the new compact LD steel mill in Donawitz.

On the road from steel producer of highest qualities to a steel processing and finish-ing group of companies that works as a problem solver for the customer in all aspects, we have achieved additional milestones through acquisitions, investments in companies and joint ventures, as well as investments. The acquisition of a one-third interest in the Italian press shop and component plant TURINAUTO enables us to now also offer pressed car body components to the automobile industry.

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ness to perform and their creative potential determine our success to the highest degree. In the modern processing group we are striving for, each individual will be even more able to shape the activities of the company: through creative potential, through motivating opportunities but also through participation in the company.

For this reason VOEST-ALPINE STAHL AG purchased a block of 4.01 % of its own shares from VA Technologie AG in summer 2000 and took over 1 % of its share cap-ital from the ÖIAG in April 2000. This block of own shares amounting to 5.01 % is now being transferred through our current employee share ownership program.

I would like to take this opportunity to express my gratitude to all employees of the company for their performance rendered during the past business year and for their approval of the employee share ownership program.

I would like to express my gratitude to all shareholders and business partners in the name of the Managing Board of VOEST-ALPINE STAHL AG for the trust placed in us during the 2000/01 business year.

art technology are extremely important, since they are essential factors for the suc-cess of our business. Even though the European steel industry on the whole utilizes state-of-the-art technologies and innovation characterizes the events, the sector is categorized as a traditional heavy industry and viewed as a typical example for the “old economy”. However, fact is that our Group, which to the utmost degree believes in high-tech systems for its production and manufactures high-tech products, avails itself of the achievements of the “new economy” and is active in a multitude of direc-tions in this area. Our “i2b” (ideas to business) business plan is a platform for innov-ative ideas of the “new economy”. Through this platform new business ideas get the opportunity to reach a successful start-up with professional help. Promising ideas of students are promoted up to independence.

In the sector venture capital, VOEST-ALPINE STAHL, together with the 3-Banken-Gruppe (three banks group) provides capital to innovative new economy companies through the Danube Equity Fund.

Idea exchanges promoting innovative market development are not only for our ben-efit, but also enhance the attractiveness of Austria as an industrial site. A current example for the networking of university -, extra-university- and industrial facilities in the research and development sector is the establishment of the first Austrian “indus-trial center of expertise for mechatronics and automation” during the 2000/01 busi-ness year at the site in Linz. The targeted approach to sophisticated development projects, the inclusion of personnel from schools for applied sciences and universi-ties are meant to provide incentive systems for upgrades, to increase mobility and to establish companies.

The modern image of the steel industry, however, is almost not noticed by the Euro-pean public. Even today the material steel is given anachronistic attributes: steel is traditional, archaic and pollutes the environment. Large parts of the European public do not want a future for the material. A correction of the image in general is needed. How attractive a material it can be and which valuable characteristics it can have has to be more strongly impressed on the public. Together with other European steel companies, therefore, a pan-European image campaign has been launched in the 2000/2001 business year, from which we hope to receive impulses towards an improvement in image.

The main factor for the successful dynamics of our Group is and will remain its employees. They are the ones that make the transition from a steel company of tra-dition to a modern processing group possible and lend their support. Their

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Steel market – Economic development

The economic development of the global economy during the year 2000 was char-acterized by an extraordinarily dynamic development until fall. Global economic growth reached 4 % primarily driven by the US economy.

In the United States, demand and production increased in real terms by more than 5 %. Of the Latin American countries Mexico in particular, profiting from the strong demand from the US, was able to improve its economic growth reaching more than 7 %. Most of the Asian countries also achieved high growth rates, such as for instance South Korea and China, growing by more than 9 % and more than 8 %, respectively. Japan, whose economy mostly stagnated during the last decade, achieved a growth of 2 % all the same.

In Europe, the economic upturn continued in spite of an increase in crude oil prices. A booming export economy and a significant increase in investment supported the upward trend. The gross domestic product of the Euro zone grew by 3.3 % during the year 2000, favored by the low Euro exchange rate.

Austria also profited from the generally satisfactory economic environment. The most significant economic upturn since the beginning of the nineties was reported with 4 % growth. Export even grew by 11 %, profiting from increased European demand and the low Euro exchange rate.

The international steel market, in particular during the first three quarters of the year 2000, showed a strong positive dynamics. The crude steel production during the year reached a new record level at 840 million metric tons. Temporarily this strong demand for steel even led to a shortage in supply. The favorable volume development was, therefore, accompanied by significant increases in price levels during the first half of the year. Starting in the 3rd quarter 2000, the strong upward trend started to slow, due to seasonal and warehousing cycles. In addition, the beginning of a leveling out of the economy, initially on the Asian and North American markets, had a dampen-ing effect. Later, this development also reached Europe. After a continudampen-ing increase in prices for approximately one and a half years, the European steel industry experi-enced a reversal in trend during the 4th quarter 2000, resulting in significant pressure on prices during the first half of 2001.

Dynamic development of the global economy

Downturn in the steel market during the 4th

quarter 2000

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R E P O R T O F T H E M A N A G I N G B O A R D

This status report simultaneously represents the Group status report, as provided for in section 267 (3) of the Austrian Commercial Code (HGB), which permits the presen-tation of a combined status report for the Group and VOEST-ALPINE STAHL AG.

Business Development – VOEST-ALPINE STAHL-Group

The first three quarters of the 2000/2001 business year in particular (2ndthrough 4th calendar quarter 2000) were characterized by the very satisfactory volume develop-ment, a stable capacity utilization in all production areas and high profits. Towards year-end 2000 the first slowing trends could be felt, in conjunction with increased price pressure though that only came to bear in the succeeding months.

After the average profit level of VOEST-ALPINE STAHL-Group improved by approxi-mately 10 % during the 1sthalf of the 2000/2001 business year (2ndand 3rdcalendar quarter 2000), it once again increased during the 3rdquarter (4thcalendar quarter), even if by the smaller amount of 1.6 %.

However, this improvement was overcompensated by increased costs for raw materials (oil and gas in particular), the unfavorable development of the Euro/dollar parity as well as personnel expenses that increased by approximately 2.5 % effective 1 November 2000.

The beginning of the slowing trends in the 4thquarter of the business year (1st calen-dar quarter 2001) on the international steel markets and the increased price pressure led to losses of profit of approximately 3 % in this period.

PRICE DEVELOPMENT VS. EBITD VOEST-ALPINE STAHL-GROUP 2 % 5 % 0 % 3 % 3 % -1 % -5 % -8 % -2.2 % 0.5 % 1.2 % 5.3 % 4.8 % 1.6 % -2.9 %

PRICE CHANGE QUARTER-ON-QUARTER EBITD IN EUR millions CALENDAR QUARTERS

2QU97 3QU97 4QU97 1QU98 2QU98 3QU98 4QU98 1QU99 2QU99 3QU99 4QU99 1QU00 2QU00 3QU00 4QU00 1QU01 339.9

478.1

354.3 356.6

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Even so, the VOEST-ALPINE STAHL-Group during the 2000/2001 business year produced the record amount of 5.3 million metric tons of crude steel. This is an increase over the prior year of more than 10 % (1999/2000: 4.79 million metric tons).

Crude steel production at the site in Linz reached 4.0 million metric tons; the Donawitz plant produced 1.3 million metric tons. The increase in production of 8 % in the Flat Products sector and of almost 20 % in the Long Products sec-tor is not only due to very satisfacsec-tory levels of demand, but also to the further improved plant configuration.

The shipped volumes of flat products amounted to 4.0 million metric tons, an increase over the comparison value of the prior year of 3.6 %. The purchase of semi-finished goods was further reduced, due to the disproportionately high increase in crude steel volumes. Shipped volumes of Long Products of 1.18 mil-lion metric tons were 12.4 % above the comparison value for the prior year. In total, VOEST-ALPINE STAHL-Group increased shipped volumes by 5.5 % to 5.18 million metric tons compared to the figures for the prior year.

Consolidated group tur nover during the 2000/2001 business year amounted to EUR 3.166 billions or 17 % above the comparison value for the prior year (EUR 2.712 billions). This significant increase to the highest tur nover to date in com-pany history is due to the further increase in volumes as well as to satisfactory profits.

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Record level of steel production

Shipped volumes reach “all-time-high“ Group turnover on highest level S T A T U S R E P O R T 2 0 0 0 / 2 0 0 1 ( S H O R T ) B U S I N E S S Y E A R 1 9 9 7 ( 1 J A N U A R Y 1 9 9 7 – 3 1 M A R C H 1 9 9 7 ) : E X T E R N A L T U R N O V E R E U R 5 7 4 . 7 M I L L I O N S 1995 1996 1997/98 1998/99 1999/00 2000/01 EXTERNAL TURNOVER

VOEST-ALPINE STAHL-GROUP VALUES IN MILLIONS OF EUR

2,456.1

2,290.6 2,518.0

2,581.9 2,711.7

3,166.1

The Flat Products Division increased turnover in comparison with the 1999/2000 business year (EUR 2.089 billions) by 16.2 % to EUR 2.427 billions. The Long Products Division reports an increase in turnover by 16.3 % to EUR 779 millions (1999/2000: EUR 670 millions).

During the 2000/2001 business year the efforts to optimize the cost structure con-tinued. The result was a further cost savings of EUR 43 millions. The focus was primarily on business reengineering processes and the "Continuous Improvement Program" (in continuation of the TOP instruments).

REST OF EU 17 % AUSTRIA 26 % GERMANY 25 % REST OF EUROPE 11 % REST OF WORLD 8 % ITALY 13 % EXTERNAL TURNOVER 1999/2000 BY REGION VOEST-ALPINE STAHL-GROUP *) I N C L . T R A N S P O R T / S T O R A G E , FA S T E N I N G T E C H N O L O G Y STEEL- AND MECHANICAL ENGINEERING 16 % RAILWAYS 12 % AUTOMOTIVE 26 % CONSTRUCTION INDUSTRY AND SUBSUPPLIERS 19 % HOUSEHOLD APPLIANCES 10 % OIL INDUSTRY 5 % MISCELLANEOUS 12 % *)

EXTERNAL TURNOVER 1999/2000 BY SECTOR VOEST-ALPINE STAHL-GROUP

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V O E S T- A L P I N E S TA H L A G · 2 0 0 0 / 0 1 23 VOEST-ALPINE STAHL-Group reports an operating result (EBIT) of EUR 258 millions

for the 2000/2001 business year. This represents an increase of almost 70 % over the comparison value of the prior year (EUR 153 millions).

The operating result before depreciation (EBITD) of EUR 478 millions surpassed the value for the corresponding period of the prior year (EUR 354 millions) by 35 %.

The ordinary result (EGT) for 2000/2001 is EUR 247 millions; this represents an increase over the prior year (EUR 164 millions) of 51 %.

Highest earnings per share since IPO S T A T U S R E P O R T 2 0 0 0 / 2 0 0 1

V O E S T- A L P I N E S TA H L A G · 2 0 0 0 / 0 1

22

Highest operating result in company history

S T A T U S R E P O R T 2 0 0 0 / 2 0 0 1

( S H O R T ) B U S I N E S S Y E A R 1 9 9 7 ( 1 J A N U A R Y 1 9 9 7 – 3 1 M A R C H 1 9 9 7 ) : E B I T E U R 2 7 . 3 M I L L I O N S

OPERATING RESULT (EBIT)

VOEST-ALPINE STAHL-GROUP VALUES IN MILLIONS OF EUR

1995 H G B 1996 H G B 1997/98 I A S 1998/99 I A S 1999/00 I A S 2000/01 I A S 221.2 123.2 166.2 167.8 153.0 258.3

Taking a tax rate of 27 % into account an annual net income of EUR 179 millions was achieved; this means an increase of 39 % over the 1999/2000 business year (EUR 129 millions).

All essential Group companies report clearly positive results for the 2000/2001 busi-ness year.

Net financial indebtedness (gearing) of the group on 31 March 2001 of EUR 251.7 millions or 16.5 % of equity has improved significantly compared to the beginning of the business year (20 %).

Earnings per share of EUR 5.6 are clearly above the prior year‘s value of EUR 3.91. Subject to approval by the Annual General Shareholders‘ Meeting on 3 July 2001 a dividend of EUR 1.20 per share (1999/2000: EUR 1.20) plus a bonus of EUR 0.70 per share will be distributed to the shareholders of VOEST-ALPINE STAHL AG.

1995 H G B 1996 H G B 1997/98 I A S 1998/99 I A S 1999/00 H G B 2000/01 I A S 218.5 943.6

NET DEBT EQUITY GEARING

NET DEBT / EQUITY / GEARING

VOEST-ALPINE STAHL-GROUP VALUES IN MILLIONS OF EUR

23.2 % 19.2 % 10.5 % 18.2 % 20.0 % 16.5 % 133.0 1,272.4 244.2 1,343.8 286.4 1,430.0 251.7 1,529.5 196.5 1,022.2 ( S H O R T ) B U S I N E S S Y E A R 1 9 9 7 ( 1 J A N U A R Y 1 9 9 7 – 3 1 M A R C H 1 9 9 7 ) : E B I T D E U R 6 5 . 6 M I L L I O N S

OPERATING RESULT BEFORE DEPRECIATION (EBITD)

VOEST-ALPINE STAHL-GROUP VALUES IN MILLIONS OF EUR

1995 H G B 1996 H G B 1997/98 I A S 1998/99 I A S 1999/00 I A S 2000/01 I A S 350.6 258.1 339.9 356.6 354.3 478.1

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Acquisitions

With the acquisition of ROTEC Group in September 2000 by VOEST-ALPINE STAHL LINZ GmbH another step towards processing or extending the value added chain and in particular towards the automotive industry was made. The acquired company specializes in the production of precision steel pipe and their processing into pipe products ready to install, where the majority of the products is sold to the automo-tive industry and the automoautomo-tive supply industry. ROTEC Group has production sites in Belgium, Germany, France, Austria, Sweden and Spain.

In November 2000, VOEST-ALPINE STAHL LINZ GmbH acquired 33.33 % of the Italian company TURINAUTO S.p.A. that is a successor to the former press and assembly plant Rivalta of FIAT AUTO. Partners in this joint venture are the two fami-ly corporations STOLA S.p.A. and ITCA S.p.A. with a third share each. These two companies are some of the most important Italian automobile supply companies with an international reputation in the areas tool and dye manufacturing, presses and assembly. Through this investment, VOEST-ALPINE STAHL-Group for the first time has access to the production of large pressed parts for the automotive industry.

Also in November 2000, VOEST-ALPINE SCHIENEN GmbH & Co KG has signed a memorandum of understanding with NUCOR YAMATO STEEL COMPANY for the con-struction of a rail rolling mill in the United States. VOEST-ALPINE SCHIENEN GmbH & Co KG will contribute its know-how for the production of ultra long, head special hardened rails to the partnership and in turn have a 15 % interest in the new rail rolling mill in Blytheville, Arkansas. The plant is scheduled to commence operation in 2003. This investment represents the entry into the interesting American rail market, where the sale of the products of the new company outside of the NAFTA countries is exclu-sively handled through VOEST-ALPINE SCHIENEN GmbH & Co KG.

At the end of the 2000/2001 business year, VOEST-ALPINE EUROPLATINEN GmbH acquired a 51 % interest in the Italian company EUROWELD Srl., Turin, the only Italian manufacturer of laser-welded blanks. Together the two companies are the second largest suppliers in the tailored blanks sector.

Additional spin-offs realized Significant capacity increases S T A T U S R E P O R T 2 0 0 0 / 2 0 0 1 Swiss- German processing group acquired Investment made in an Italian stamping plant

Investment in rails in the USA prepared

Acquisition of majority share in an Italian tailored blanks manufacturer

S T A T U S R E P O R T 2 0 0 0 / 2 0 0 1

Company spin-offs

In line with the core process strategy, VOEST-ALPINE STAHL LINZ GmbH, effective 1 April 2001 has spun-off its former business areas heavy plats, forge and logistics into independent companies, VOEST-ALPINE GROBBLECH GmbH (heavy plate, 540 employees), ALPINE SCHMIEDE GmbH (forge, 170 employees) and VOEST-ALPINE LOGISTIK SERVICE (logistics, 610 employees).

Investments

The most important investments of the 2000/2001 business year in Linz was the relining of blast furnace no. 5, the completion of the large project "Optimization of the Liquid Phase LD Steel Mill" with an increase in capacity from 3.5 million metric tons to 3.8 mil-lion metric tons of crude steel and the completion of the LD compact steel mill in Donawitz.

Furthermore, all planned modernization and optimization measures in the hot rolling mill in Linz were implemented as scheduled.

In March 2000, the relining of blast furnace no. 6 was approved, in July the construc-tion of the third hot-dip galvanizing plant and in March 2001 the construcconstruc-tion of a second strip coating facility.

VOEST-ALPINE STAHL-Group invested EUR 253 millions in fixed assets (1999/2000: EUR 278 millions). The investments are offset by depreciation of EUR 220 millions for the same time period.

1995 H G B 1996 H G B 1997/98*) I A S 1998/99 I A S 1999/00 I A S 2000/01 I A S * ) I N C L . ( S H O R T ) F I N A N C I A L Y E A R 1 9 9 7

INVESTMENT EXPENSES (TANGIBLE FIXED ASSETS)

VOEST-ALPINE STAHL-GROUP VALUES IN MILLIONS OF EUR

TANGIBLE FIXED ASSETS DEPRECIATION 203.2

319.0 319.5 333.3

278.0

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V O E S T- A L P I N E S TA H L A G · 2 0 0 0 / 0 1 27

Research and development

The focus of R & D in the Flat Products Division was process optimization blast fur-nace, the development of high-strength and ultra-high strength hot-rolled steel grades and painted strip for modular components for the automotive industry. In the sector Long Products the continuation of the development of highly wear- and fatigue-resistant rail grades (bainitic rails), the intensified systems research into the wheel/rail contact, the product development in the cold extrusion sector of wire rod and the continuing optimization of the CPE process were at the forefront of the efforts.

VOEST-ALPINE STAHL-Group during the 2000/2001 business year expended approximately EUR 32 millions (1999/2000: EUR 31.98 millions) for research and development.

Project mini-mill

The project of a flat products mini mill at a European production site was shelved in December 2000, since calculations showed only a marginal economy. Investment costs of almost EUR 1 billion showed no appropriate yield for the capital employed. Additional important reasons for the critical view of the project were the insecurities regarding long-term price development of scrap and scrap substitutes as well as energy (in particular electricity), and also the lasting relation of Euro to dollar that is very difficult to estimate.

Purchase of own shares

On 6 July 2000, VOEST-ALPINE STAHL AG acquired a share package of 4.01 % of its own shares from VA TECHNOLOGIE AG.

On 27 April 2001, VOEST-ALPINE STAHL transferred an additional share package amounting to 1% of its share capital from ÖIAG to its own portfolio. This total volume of 5.01 % of own shares is currently utilized for an employee share ownership pro-gram being implemented.

S T A T U S R E P O R T 2 0 0 0 / 2 0 0 1

V O E S T- A L P I N E S TA H L A G · 2 0 0 0 / 0 1

26

S T A T U S R E P O R T 2 0 0 0 / 2 0 0 1

Employees

On 31 March 2001, VOEST-ALPINE STAHL-Group had 15,658 employees (excluding apprentices) compared to 15,228 employees at the end of the prior business year. The increase in the number of employees is due to acquisitions and the expansion in capacity.

Reconciliation fund

In the year 2000, the Austrian Federal Government has established a fund to pay damages to forced laborers from World War II that worked in Austria, as a gesture of reconciliation. Due to moral and humanitarian considerations and on a voluntary basis, VOEST-ALPINE STAHL-Group transferred EUR 6.5 millions to this fund. Fur-thermore, VOEST-ALPINE STAHL-Group has instated a committee of historians to address the history of forced labor in the plants in Linz of the former Hermann Göring Group, Berlin. The work on this project will be completed in summer 2001. The com-pany will publish the results and make the documents resulting from the research available to the public in a documentation center that will be completed in 2002.

Forecast

The year 2001, and the second half of the year in particular, is characterized globally by considerable uncertainty regarding economic prospects. The trend towards a stagnation of economic growth, especially in the USA but during the last few months also within the European Union, creates a considerably more difficult environment for the steel industry than during the last year. Even though the average price level for hot-rolled strip, after dropping significantly during the first half of the current year, now evidences not only stabilization but even a slight trend towards recovery, a positive trend reversal for the second half is not yet certain. A stabilization of the economy during the further course of the year is a requirement. In any case, it has to be assumed that the levels of the results for the past business year will not be sustained. Even so, a clearly positive result is expected for the 2001/2002 business year from our current view, based on a satisfactory capacity utilization of all essential facilities.

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Shareholder Structure

The shareholder structure of VOEST-ALPINE STAHL AG currently is as follows: During the past business year, the share price development for VOEST-ALPINE

STAHL share mirrored the general development of the steel sector in the capital markets.

Fueled by an anticipated downtur n in the steel economy the share was under-represented in many portfolios during the course of the last year, together with many European steel shares. Neither the lessened sensitivity to cyclicity nor the predicted record result were able to change this fact.

The share price compared to the Austrian Leading Index, the ATX developed accordingly. In the time from 1 January 2000 to 31 March 2001 the VOEST-ALPINE STAHL share performed by approximately 20 % worse. It has to be taken into account, however, that it had the best development of all ATX values during the previous year.

That the top position of VOEST-ALPINE STAHL AG, strategically as well as in respect to costs and ear nings, is at least noted within the industry becomes obvious in the comparison with inter national steel indices. Here the European (23 %) as well as the American (18 %) steel index was clearly outperformed.

V O E S T- A L P I N E S TA H L S H A R E

110 100 90 80 70 60

VOEST-ALPINE STAHL VS. AUSTRIAN TRADED INDEX (ATX)

VOEST-ALPINE STAHL AG AUSTRIAN TRADED INDEX (ATX)

JANUARY 2000 Change over year-end 1999 in % 2001 31 MARCH 2001

110 100 90 80 70 60 50 40

VOEST-ALPINE STAHL VS. INTERNATIONAL STEEL INDICES

JANUARY 2000 Change over year-end 1999 in % 2001 31 MARCH 2001

VOEST-ALPINE STAHL AG EUROPEAN STEEL INDUSTRY INDEX* US-STEEL INDUSTRY INDEX**

* Source: Datastream ** Source: Standard & Poors Steel

1 ) P E R C E N TA G E S I N D I C AT I V E

2 ) I N C L . 5 % F R O M E M P L O Y E E S H A R E O W N E R S H I P

VA TECHNOLOGIE AG 10.93 % ÖIAG 37.80 % SHAREHOLDER STRUCTURE (JUNE 2001)

VOEST-ALPINE STAHL AG PRIVATE AND INSTITUTIONAL INVESTORS 51.27 % REST OF EUROPE1 )3.26 % GERMANY1 ) 5.00 % UK1 ) 5.00 % USA1 ) 16.00 % AUSTRIA1 ) 22.01 %2 )

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Roberto Pezzetta was born 1946 in Treviso. His career as a product designer started at the Italian household applian-ce manufacturer Zoppas. Later he worked at the winter sports expert Nordica. In 1981 he received the Design Oscar ”compasso d´oro“. Since 1982 he has been chief designer at Elektrolux Zanussi, the largest household appliance manufacturer in Europe.

R O B E R T O P E Z Z E T TA

WASHING MACHINE IZ 12W, Zanussi Design: Roberto Pezzetta

V O E S T- A L P I N E S TA H L A G · 2 0 0 0 / 0 1

30

I N F O R M AT I O N F O R I N V E S T O R S

Equity Capital EURO 239,820,352.75 divided into 33,000,000 individual share certificates

Due to the temporary ownership of own shares the number of shares, according to IAS, is lowered on the balance sheet date of 31 March 2001 to 32,007,525 shares.

Share type Common bearer shares

Highest share price April to March 2001 EUR 33.69

Lowest share price April to March 2001 EUR 24.91

Share price on 31 March 2001 EUR 30.55

Market capitalization on 31 March 2001 EUR 967,723,184

2000/01 Business year

Earnings per share EUR 5.60

Dividend per share*) EUR 1.20

Bonus per share*) EUR 0.70

Book value per share EUR 47.79

Dividend distribution ratio % 34

*)

as proposed to the Annual General Shareholders’ Meeting

THE FOLLOWING INSTITUTIONS PREPARE REGULAR ANALYSES ON THE DEVELOP-MENT OF VOEST-ALPINE STAHL AG FROM THE VIEWPOINT OF THE CAPITAL MARKETS:

ABN Amro, London BNP Paribas, Frankfurt CAIB Investmentbank AG, Vienna Crédit Lyonnais, London Crédit Suisse First Boston, London Deutsche Bank, Frankfurt Dresdner Kleinwort Benson, London

Erste Bank, Vienna Goldman Sachs, London HSBC CCF Securities, London Merrill Lynch, London

Morgan Stanley Dean Witter, London Raiffeisen Zentralbank Österreich, Vienna Salomon Smith Barney, London

UBS Warburg Dillon Read, London Société Générale, London West LB Panmure, Düsseldorf

I N F O R M AT I O N F O R S H A R E H O L D E R S Phone: +43/732/6585-3152 E-Mail: InvestorRelations@voest.co.at Internet: http://www.voest-alpine-stahlag.com Reuters: VAST.VI Bloomberg: VAST AV Datastream: O:VAS S C H E D U L E 2 0 0 1

3 July 2001 Annual General Shareholders‘ Meeting, Linz 10 July 2001 Ex-dividend date

16 July 2001 Dividend payment date

17 August 2001 Shareholders‘ Letter on the development of the 1stquarter 2001/02 18 October 2001 Shareholders‘ event in Vienna as part of the Profit Fair, Vienna. 16 November 2001 Shareholders‘ letter on the 1sthalf of 2001/02

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VOEST-ALPINE KREMS GmbH with its subsidiaries SADEF N.V., Belgium, METSEC PLC., Great Britain, PRÄZISIONSPROFIL GmbH, Germany, VOEST-ALPINE PROFIL-FORM S.R.O., Czech Republic, ROLL PROFIL-FORMING CORPORATION, Kentucky/USA as well as VOEST-ALPINE KREMS FINALTECHNIK GmbH, is market leader in the field of tailored tubes and sections in Europe.

Even though VOEST-ALPINE KREMS GmbH had to deal with a volume decrease of 3.6 % to 271,000 metric tons during the 2000/2001 business year, sales revenue was increased by 12.6 %. There were decreases in volume to be contended with in the sector standard tubes and hollow steel sections, due to full warehouses at dealers, but a significant increase was reported in customer-specific tube and profile cross sections as well as the increasingly important sector of processing parts and com-ponents.

SADEF N.V. once again reports a very satisfactory business year. In this, the tenth year of the affiliation of the Belgian company with VOEST-ALPINE KREMS Group, sales could once again be increased while income was stable on a very satisfactory level.

The British subsidiary METSEC plc continued its reengineering measures rapidly in cooperation with the business consulting group McKinsey and has started to imple-ment the TOP process for continuous improveimple-ment, that has already been success-fully implemented in Krems. An additional boost to productivity is expected from the implementation of the so-called "Model-Line" method throughout the company. This method builds individual production aggregates according to state-of-the-art knowledge of processes, information technology and ergonomics.

The past business year for PRÄZISIONSPROFIL GmbH was a year of transition characterized by the complete new construction of the company facilities at a new site and the corresponding transition measures. At the beginning of the 2001/2002 business year the company has entered a future-oriented growth phase.

The business development of VOEST-ALPINE PROFILFORM S.R.O. has continued favorably. The until now extraordinary success of the Czech subsidiary that started operations in 1998 has caused VOEST-ALPINE KREMS GmbH to advance the plan-ning for the next growth phase.

VOEST-ALPINE KREMS GmbH SADEF N.V. METSEC plc. PRÄZISIONSPROFIL GmbH VOEST-ALPINE PROFILFORM S.R.O. F L A T P R O D U C T S D I V I S I O N

The lead company of the Flat Products Division, VOEST-ALPINE STAHL LINZ GmbH, was able to achieve one of the best results in company history for the 2000/2001 business year. The reasons for this success are on several levels. Aside from the eco-nomic environment primarily the consistent strategy of a further extension of the value-added chain through an emphasis on product finishing. In addition, the continuous improvement of the cost structure achieved far-reaching savings effects, the business reengineering process was successfully continued and the sourcing of raw materials was further optimized.

The peak of the steel cycle in the 2ndand 3rdquarter as well as the positive development of important customers where significant increases in sales could be achieved in some cases, led to a stable capacity utilization, with a simultaneous increase in the shipped volumes of cold-rolled, hot-dip and electrolytically galvanized as well as organically coated plate.

Starting in the 4thquarter of the business year, however, dampening tendencies were discernible. Increased imports from third countries and excessively high stock held by the customers led to increasing price pressure. Initially the hot-rolled strip was influ-enced by this development, but at the end of the business year it had also spread to cold-rolled and coated products. The business area heavy plate, however, remained untouched by this development. It was characterized by a continuing improvement in volume as well as in price levels.

Turnover for VOEST-ALPINE STAHL LINZ GmbH for the 2000/2001 business year was EUR 1,597 millions (1999/2000: EUR 1,363 millions).

Due to strict implementation of the marketing concepts, the continuous improvement of the degree of service through new planning and logistics systems as well as through the orientation towards long-term contracts, the company today is one of the leading suppliers of the automotive, household appliance and construction industries. It is one of the market and quality leaders in its core markets.

The program of VOEST-ALPINE STAHL LINZ GmbH comprises hot-rolled and cold-rolled as well as surface-treated flat products. Offered are hot-dip galvanized (THER-VAGAL), electrolytically galvanized (GRAVIGAL) and organically coated (COLOFER) sheet and strip. Electrical steel sheet (ELDUKT, ISOVAC), heavy plate and clad plate complete the product range. Aside from the standard steel grades the product range comprises deep drawing and specialty deep drawing grades made of ultra-low car-bon, vacuum-treated steel grades as well as deep drawing and drawing grades made of Al-killed steels.

VOEST-ALPINE STAHL LINZ GmbH

F L A T P R O D U C T S D I V I S I O N

V O E S T- A L P I N E S TA H L A G

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V O E S T- A L P I N E S TA H L A G · 2 0 0 0 / 0 1 35 The business area non-ferrous metal casting also reported high growth. One of the

reasons was the introduction of a new product group that was very well received by the customers. An important step for this business area has been taken with the con-struction of a new building for the non-ferrous metal foundry.

The company achieved a turnover of EUR 59 millions (1999/2000: EUR 49 millions) for the 2000/2001 business year.

During the 2000/2001 business year, VOEST-ALPINE GIESSEREI TRAISEN GmbH was able to achieve a significantly higher turnover of EUR 26.0 millions (1999/2000: EUR 20 millions), due to an improvement in the situation on the market.

The increase in turnover was due primarily to the volume increases to main cus-tomers. The business field "energy casting" in particular experienced this develop-ment. Together with VOEST-ALPINE GIESSEREI LINZ GmbH and the "Industrial Cen-ter for Expertise Casting" the foundry in Traisen gained new customers and improved its existing customer relationships. The strategic orientation of the company toward a specialty steel casting program with precision finishing and component production has proven to be correct.

Strong growth characterized the past business year of VOEST-ALPINE EURO-PLATINEN GmbH & CO, as in prior years. The reason was the satisfactory condition of the automotive market. There were more orders than originally anticipated. More than 4 million laser welded blanks were delivered to almost all large car manu-facturers. The focus of the program is doors, closures and side walls.

Furthermore, during the past business year, the implementation of the certification according to ISO / TS 16949 was successfully concluded.

To manufacture the orders taken on time, an expansion program on a large scale was agreed on with an expansion of factory floor space by approximately 8,000 square meters including a roofed loading area. Furthermore, investments were made into a second stamping line and the laser welding facility VI, which is slated to commence operations in the fall of 2001, was ordered. The planned investment projects amount to approximately EUR 18 millions. Another welding line is planned for 2002.

The company achieved a turnover of EUR 42 millions (1999/2000: EUR 32 millions) during the 2000/2001 business year.

VOEST-ALPINE GIESSEREI TRAISEN GmbH VOEST-ALPINE EUROPLATINEN GmbH & Co F L A T P R O D U C T S D I V I S I O N V O E S T- A L P I N E S TA H L A G · 2 0 0 0 / 0 1 34

The US company ROLL FORMING CORPORATION, acquired 100 % in February 2000, was satisfactorily integrated during the first year of its affiliation. During the past business year, the company has achieved a 45 % increase in sales and a significant improvement of its earnings situation. However, there are still significant potentials to increase the market and to improve productivity. As a first step, a com-pletely new facility is under construction in Jeffersonville/Indiana at an expense of US$ 15 millions.

This facility is slated to supplement the production site in Shelbyville/Kentucky within a few months. The new site will take over the production of those "made to measure” profiles and custom roll formed sections/tubes that were until now supplied from Europe to American customers.

At VOEST-ALPINE KREMS FINALTECHNIK GmbH the goal is to first put the compa-ny on a firm basis and then to transition it into a growth- and profit-oriented phase. To this end, supplementary to the adjustment of the payment structures, a compre-hensive reengineering of the process was initiated.

VOEST-ALPINE KREMS Group, during the 2000/2001 business year, achieved a total turnover of EUR 482 millions (1999/2000: 423 millions). The company is active in the sectors precision welded tubes and welded hollow sections, open standard profiles and sections as well as all kinds of custom-made profiles and sections, parts and components, but also in the areas high-bay storage and racking, road safety systems (guard rails, culverts), overhead cable masts and hot-dip galvanizing.

The customer sectors comprise steel construction, modular building systems and interior finishing, mechanical engineering, automobile and commercial vehicle pro-duction, agricultural machinery and aircraft technology.

VOEST-ALPINE GIESSEREI LINZ GmbH during the 2000/2001 business year was equally successful in both business areas, steel casting and non-ferrous metal cast-ing. The steel casting business area profited from the high demand in the sector gas and steam turbines. This development was primarily driven by the North American market. The company was able to further consolidate its globally leading position as supplier of high-quality steel casting components. This leading position was con-firmed by the award "Supplier of the Year" by its main customer, General Electric Power System. ROLL FORMING CORPORATION VOEST-ALPINE KREMS FINALTECHNIK GmbH VOEST-ALPINE GIESSEREI LINZ GmbH F L A T P R O D U C T S D I V I S I O N

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F L A T P R O D U C T S D I V I S I O N

For VOEST-ALPINE STAHLHANDEL GmbH the 2000/2001 business year was char-acterized primarily by the very successful activities of its trading subsidiaries in the Czech Republic and Croatia, which have exceeded their target figures by far. The also successful business development of the Hungarian branch laid the foundation for an expansion of the warehousing and the activities in this region. However, since Sep-tember 2000, due to excess supply with a simultaneous decrease in demand, a decrease in the margins was reported in Austria. In spite of this, the company was able to improve its position by 11 % compared to the prior year (EUR 180 millions), with a turnover of EUR 202 millions.

The highlight of the 2000/2001 business year for VOEST-ALPINE STAHL SERVICE CENTER GmbH was the start-up of the new slitting and cut-to-length facility. The anticipated start-up curve was significantly exceeded.

The development of the business year during the first half was characterized by very satisfactory cyclical demand. During the second half, prices dropped, just as for the entire European steel industry. The high ratio of long-term contracts and the continu-ing volume demand made it possible for the company to still exceed budget figures. The turnover of VOEST-ALPINE STAHL SERVICE CENTER GmbH for the 2000/2001 business year amounted to EUR 151 millions (1999/2000: EUR 124 millions).

VOEST-ALPINE STAHLHANDEL GmbH VOEST-ALPINE STAHL SERVICE CENTER GmbH F L A T P R O D U C T S D I V I S I O N Turnover

Operating result bef. depreciation (EBITD) Operating Result (EBIT)

Investments in tangible and intangible assets and interests Ordinary result (EGT) Employees (excl. apprentices)

2000/01

I A S

KEY FIGURES

FLAT PRODUCTS VALUES IN MILLIONS OF EUR

2,426.7 400.8 234.3 247.5 204.8 11,463 1999/00 I A S 2,088.8 303.2 139.3 188.7 138.5 11,065 1998/99 I A S 2,004.0 308.3 148.0 225.6 120.0 11,144 1997/98 I A S 1,949.5 302.6 148.8 234.0 116.9 10,799 1996 H G B 1,821.0 230.3 113.5 302.1 -11,171 1995 H G B 1,962.8 329.3 219.3 181.6 -11,539 REST OF EU 18 % AUSTRIA 29 % GERMANY 26 % REST OF EUROPE 9 % REST OF WORLD 5 % ITALY 13 % EXTERNAL TURNOVER 1999/2000 BY REGION FLAT PRODUCTS STEEL- AND MECHANICAL ENGINEERING 18 % OTHER 12 % AUTOMOTIVE 30 % CONSTRUCTION AND SUBSUPPLIERS 23 % TRANSPORT/STORAGE 3 % HOUSEHOLD APPLIANCES 14 % EXTERNAL TURNOVER 1999/2000 BY SECTOR FLAT PRODUCTS

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PEUGEOT 406 Coupé Design: Sergio Pininfarina

Born 1926 in Turin, son of Battista Farina – one of the most famous car design-ers in Italy during the post-war years. After having concluded his study of mechanical engineering he started work in the family-owned company ”Car-rozzeria Pininfarina“ in 1950. He enlarged the company’s field of activities from design to technical development and production. The ”Gran Signore of car design“ was involved in the building of roughly 30 million cars (for example, Fer-rari, Alfa Romeo, Lancia, Peugeot, Fiat). In 1995 he was awarded the Design Oscar ”compasso d´oro“.

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VOEST-ALPINE STAHL DONAWITZ GmbH was able to profit from the satisfactory steel economy during the 2000/2001 business year, resulting in capacity utilization of the plant capacities. Production volume was at approximately 1,300,000 metric tons (1999/2000: 1.1 million metric tons).

The company achieved a turnover of EUR 325 millions (1999/2000: EUR 266 mil-lions).

VOEST-ALPINE STAHL DONAWITZ GmbH supplies all long product companies with semi-finished product as well as external customers. In May the conversion and new construction of the existing steel mill in Donawitz into a LD compact steel mill was completed successfully. The start-up of the new facility progressed flawlessly. Already in March 2001 the production volume at the site reached 124,400 metric tons, the highest volume to date. Aside from a reduction of production cost by 10 % this investment also made it possible to reach the highest quality steel grades.

Swept along by the pan-European economic upturn, the wire industry also experi-enced a strong upturn that carried through almost the whole 2000/2001 business year. All important customer industries of the company (automotive supply, fastening technology, steel construction and mechanical engineering) achieved respectable growth. In addition, the trend towards higher quality annealed material has increased, so that an improvement in the quality mix could be achieved along with the increase in volume. An expansion of the production of cold extrusion wire rod at the site in Bruck was approved to enable the company to keep up with this development. In fall 2001 this new line will be started-up. The only economic downside was the develop-ment of the Austrian construction industry. The sales volume (without contract labor) was increased from 422,000 metric tons to 450,000 metric tons. This corresponds to an increase of 6 %. The sales volume even increased by 10 % during the prior year and now is holding at EUR 203 millions (1999/2000: EUR 184 millions). These record levels are even more satisfactory since they were achieved in spite of a steel short-age and technical problems during the start-up of the wire line. At the end of March 2001 the rope mill in St. Aegyd was sold to an Austrian competitor, since it no longer constituted part of the core business of the company.

The product range of VOEST-ALPINE AUSTRIA DRAHT GmbH comprises high-quality wire rod, drawn wire (cold extrusion, cable and spring steel wire) as well as pre-stressed concrete stranded wire, pre-stressed concrete wire, wire rope and reinforcing wire mesh.

VOEST-ALPINE STAHL DONAWITZ GmbH VOEST-ALPINE AUSTRIA DRAHT GmbH L O N G P R O D U C T S D I V I S I O N

VOEST-ALPINE SCHIENEN GmbH & Co KG, lead company of the Long Products Division was able to further consolidate its position as market leader in the European countries during the 2000/01 business year. The reason being that the long rail market, dominated by the company with the introduction of ultra-long head special hardened rails has continued to prove itself as a growth market with stable price levels. Strict orientation towards service (just-in-time logistics) and state-of-the-art technology in large batch production made it possible for VOEST-ALPINE SCHIENEN GmbH & Co KG to further increase its market share in this high-quality segment. The business area packages and systems was also expanded. In the high velocity project Cologne – Frankfurt the company, through its subsidiary VOEST-ALPINE KLÖCKNER BAHNTECHNIK GmbH, has become the general contractor for the manufacture of the ready to use "steel track". The business with central European railroads and rail-roads outside of Europe did not develop uniformly; tight budgets and far-reaching restructuring measures were in the way of the realization of new project orders. Given this non-uniform economic environment the company still managed to maintain its sales volume and value on a very high level.

The sales volume during the 2000/01 business year amounted to 309,000 metric tons (1999/00: 314,000 metric tons), turnover to EUR 189 millions (1999/00: EUR 195 millions).

An essential ingredient of the success during the past business year were again the investments in quality assurance and increased productivity. Projects in the areas "Visual Rail Inspection", "Walking Beam Furnace - Increase of Bloom Size" and "Increase in Throughput of Long Rails" were completed on schedule.

VOEST-ALPINE SCHIENEN GmbH & CO KG places special emphasis on the intensi-fication of the research and development activities. Projects in the segments "Bainitic Rails", "Advanced Development of the HSH Manufacturing Process", "Rolling Con-tact Wheel-Rail/Test Stand" were dynamically advanced and further developed and they are the guarantors for the increases in customer benefit in the international per-manent way business.

Through its future-oriented measures, VOEST-ALPINE SCHIENEN GmbH & CO KG is well prepared for an anticipated further increase in the dynamics of the market and a corresponding increase in competitiveness.

The production program of VOEST-ALPINE SCHIENEN GmbH & CO KG comprises high-tech rails in unwelded delivery lengths up to 120 meters, flat-bottom, grooved and crane rails in all desired steel grades or in head special hardened qualities, con-struction rails in all desired steel grades, point rails in head special hardened quality as well as permanent way profiles and sections in all desired steel grades.

VOEST-ALPINE SCHIENEN

GmbH & Co KG

L O N G P R O D U C T S D I V I S I O N

V O E S T- A L P I N E S TA H L A G

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V O E S T- A L P I N E S TA H L A G · 2 0 0 0 / 0 1 43 L O N G P R O D U C T S D I V I S I O N

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VOEST-ALPINE STAHLROHR KINDBERG GmbH & Co KG profited during the past business year from the favorable economy in the oil and gas industry as well as from the cooperation with the world‘s largest manufacturer of drilling equipment, GRANT PRIDECO. Increasing exploration and exploitation activities led to an increase in demand for high-quality specialty pipe on a global scale. This was positive for the volumes sold as well as for profits. All production areas of the company during the past business year were working at capacity. During the 2000/2001 business year, the company achieved a tur nover of EUR 218 millions (1999/2000: EUR 104 millions). Through the stable volume devel-opment and a profit situation on a high level the company is again working at capacity for the next months.

VOEST-ALPINE STAHLROHR KINDBERG GmbH & Co KG specializes in the manufacture of ready-to-install oil and gas field pipes, for instance non-collapsible and low-temperature resistant grades and pipes with gas-tight threaded connections, in the manufacture of drill hole equipment as well as the production of quality and boiler pipe.

VAE continued its controlled growth strategy also during the past business year. Through the establishment of the joint venture with the Austrian Federal Rail-roads the company already has 19 production sites throughout the world.

In spite of temporary negative influences on individual markets, that could be more than compensated through the global presence, supported by the lasting restructuring, rationalization and cost reduction measures a stabilization on a high level was achieved during the 2000/2001 business year.

Consolidated Group tur nover was at EUR 291 millions (EUR 306 millions for the comparison period during the prior year).

Analogous to VOEST-ALPINE SCHIENEN GmbH & CO KG the targeted goal of VAE AG is the extension of the value added chain or in an expansion of the com-ponent and systems product range. A milestone will be the "ready to plug in switch". This is a switching system that is completely assembled at the plant and delivered to the construction site ready-to-install and that only has to be installed into the rail network. The customer benefit is in the enormous reduc-tion of installareduc-tion time from 2-3 days to a few hours. On 8 November 2000 the first roll-out of a ready-to-plug-in switch to ÖBB (Austrian Railroads) took place.

VOEST-ALPINE STAHLROHR KINDBERG GmbH & Co KG VAE Aktiengesellschaft L O N G P R O D U C T S D I V I S I O N Turnover

Operating result bef. depreciation (EBITD) Operating Result (EBIT)

Investments in tangible and intangible assets and interests Ordinary result (EGT) Employees (excl. apprentices)

2000/01

I A S

KEY FIGURES

LONG PRODUCTS VALUES IN MILLIONS OF EUR

779.3 94.2 40.8 70.1 31.1 4,129 1999/00 I A S 670.0 64.0 26.6 104.0 21.6 4,123 1998/99 I A S 629.9 54.8 26.4 203.5 19.0 4,995 1997/98 I A S 627.1 48.3 28.4 45.7 28.8 3,578 1996 H G B 521.6 36.0 18.0 25.8 -3,585 1995 H G B 540.9 36.9 17.5 25.8 -3,484 CONSTRUCTION INDUSTRY 9 % RAILROADS 45 % OIL INDUSTRY 17 % AUTOMOTIVE INDUSTRY 16 % CIVIL AND MECHANICAL ENGINEERING 8 % FASTENING INDUSTRY 5 % EXTERNAL TURNOVER 1999/2000 BY SECTOR LONG PRODUCTS REST OF WORLD 16 % AUSTRIA 25 % GERMANY 20 % REST OF EU 13 % ITALY 12 % REST OF EUROPE 14 % EXTERNAL TURNOVER 1999/2000 BY REGION LONG PRODUCTS

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W AT E R L O O S TAT I O N , L o n d o n A r c h i t e c t : N i c h o l a s G r i m s h a w

Born 1939 in Hove. Studied in Edinburgh and graduated from the London Architectural Association School in 1965. With his London bureau, Nicholas Grimshaw & Partners, he won numerous awards and N I C H O L A S G R I M S H A W

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