Annual Report 2005/06 - voestalpine

marKeT environmenT anD
BUsiness perFormanCe
The market environment – seen both geographically
and by sector – in the division’s
three business units was not uniform.
In the standard tubes and sections segment,
the first six months of the 2005/06 business
year were characterized by difficult circumstances
on the market. The adverse effect of
prematerial costs, which remain high, was
aggravated during this period by concurrent
pressure on prices that resulted from overcapacities.
During the second half of the year,
the market environment was much more favorable.
In particular, increased demand beginning
early in the fourth quarter, driven
primarily by companies replenishing their
low inventory and an improved level of incoming
orders in Germany, enabled the division
to consistently continue with its “price
before quantity” strategy in this sector despite
the fact that the first half of the year was
difficult.
The tailored tube and sections segment was
positively affected by the satisfactory development
of its most important customer indus-
tries: the construction and building supply
industry (especially formwork construction
and storage technology), the commercial vehicle
industry (primarily cab construction and
chassis beams), and the North American
aviation industry. However, demand for partition
walls and window reinforcement profiles
was weaker.
It is primarily the divisional companies in the
Benelux countries, Great Britain, Germany,
and the USA that are active in the special
products business segment; they largely supply
customers in their regions. In this segment,
especially the European core markets
(primarily Germany, France, Great Britain,
Netherlands, Spain, and some of the Eastern
European countries) and the USA reflected
a positive trend in the 2005/06 business
year.
The market environment for the storage technology
sector was very positive, particularly
in the first two quarters when many projects
were handled, queries about possible new
orders were received, and incoming orders
were logged. During the second half of the
business year, the stream of incoming projects
became somewhat more sluggish, however,
demand remained high.
Divisional Reports
Annual Report 2005/06