Salzgitter AG has reported a preliminary EBITDA of $576 million and a pretax profit of $254 million for the first nine months of FY 2023, surpassing market expectations. However, the company has revised its full-year sales forecast slightly downwards due to economic challenges.
Salzgitter AG, a prominent player in the steel industry, has released its preliminary results for the first nine months of the financial year 2023, revealing figures that have exceeded the expectations set by the capital market. The company has achieved an EBITDA (earnings before interest, taxes, depreciation, and amortization) of $576 million, which, although lower than the $1,397 million reported in the same period the previous year, is still above current market projections. Similarly, the pretax profit stands at $254 million, down from $1,145 million in the prior year but still ahead of market forecasts.
An interesting facet of these results is the contribution from Aurubis AG, an equity investment, which added $20 million to the result, a decrease from $116 million contributed in the same period of the previous year. This contribution is significant as it reflects the investment gains from associated companies and joint ventures.
In terms of sales, Salzgitter Group’s external sales were reported at around $8.4 billion, a decrease from $9.8 billion in the prior year's comparable period. This downturn in sales is attributed to the continued sluggish performance of the German economy coupled with a highly volatile political and economic global landscape.
In light of these factors, Salzgitter AG has adjusted its sales forecast for the financial year 2023 to around $11 billion, down from the previously anticipated range of $11.5 billion to $12 billion. However, the company stands by its earnings guidance, projecting an EBITDA between $650 million and $700 million, and a pretax profit ranging from $200 million to $250 million for the full year. This guidance also forecasts a return on capital employed (ROCE) that is expected to be significantly lower than the level achieved last year.
Salzgitter AG cautions that the final figures for the year could still be impacted by various factors, including fluctuations in raw material costs, precious metal prices, and exchange rates. The detailed financial statements for the first nine months of the financial year 2023 are set to be published on November 13, 2023.
Despite the economic headwinds and market volatility, Salzgitter AG has managed to deliver a robust performance for the first nine months of 2023, with figures that have outdone market predictions. The slight revision of the sales forecast reflects a realistic adjustment in the face of external economic pressures. Moving forward, the company remains cautiously optimistic, with its eyes firmly set on the end-of-year results, demonstrating resilience and adaptability in challenging times.