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A Group Management Report and Management Report on Salzgitter AG II. Profitability, Financial Position and Net Assets 132 133
(–1 ktons) and seamless stainless steel tubes (–2 ktons) reported declines, shipments of precision tubes
rose following the integration of new companies (+111 ktons).
Tubes Division Shipments
0 250 500 750 1,000
1,267
1,216
1,250
in kt FY 2007 FY 2006
Sales of the Tubes Division advanced by € 409 million (+19%) to € 2,604 million in 2007, as compared
with € 2,195 million in 2006. All product groups contributed to this growth, in particular, however,
the large-diameter pipes business (proportionate share: € +98 million). The companies MFR
(€ +53 million), MHP (€ +33 million) and ROB (€ +5 million) reported sales growth owing to higher
selling prices and volumes. The newly added companies SMP, VPE and MRS lifted sales by € 161 million.
At the DMV Group, a markedly higher price level in particular intended to offset hikes in input
materials, boosted sales by € 60 million.
Tubes Division Sales
0 500 1,000 1,500 2,000 2,500 3,000
in € mil. FY 2007 FY 2006
Tubes Division EBT
0 100 200 300 400
in € mil. FY 2007 FY 2006
262.9
2,195
302.5
2,604
Companies in the Tubes Division continued in 2007 to pass on higher input material costs to customers
through higher selling prices. Earnings before tax of € 302.5 million significantly outperformed the
previous year’s level (€ 262.9 million). Particularly notable is the fact that profit in the first half of 2006
still included a contribution from Vallourec of € 73.0 million. On the other hand, the second half of 2007
includes the results of the companies of the precision tubes business (SMP, VPE and MRS: € 7.9 million).
Excluding these effects, the Tubes Division reported an increase in profit of € 104.7 million.
In the large-diameter tubes business, EP benefited from improved selling price quality. A very good
level of earnings before tax was generated in 2007, despite significantly more expensive input materials.
The EP Group closed the financial year 2007 with a pre-tax profit of € 143.0 million (2006: € 158.2 million);
on a proportionate basis, € 71.5 million of this amount was attributable to the Tubes Division
(2006: € 79.1 million). MRM’s result of € 102.2 million was significantly higher than the previous
year’s figure of € 26.5 million, which was mainly due to higher transfer prices with EP. SZGR had full
Profitability, Financial
Position & Net Assets