Annual Report 2010 - Scana Industrier ASA

12Annual Report 2010 Scana Industrier ASABUSINESS AREA stEElThe steel business area has a several hundred yearlong tradition in the Swedish steel industry with regardto the companies Scana Steel Björneborg, Scana SteelBooforge and Scana Steel Söderfors, in addition to thecooperation with Motala Verkstad AB. This businessarea also includes Leshan Scana Machinery Companyin China, plus the Norwegian company Scana SteelStavanger.The companies each have an independent and longhistory, and specialise in different production areas.The business area supplies complete products toworkshops, the marine industry and the oil and gasindustry. Production takes place at Scana’s ownproduction facilities, which include melting plants,forges, rolling mills, foundries and heat treatment andmachining units. Production is of a high standardand complies with ISO-certified quality assurancesystems. The business is characterised by high levels ofmetallurgical expertise and strong market positions inthe respective product areas.Strategic positionScana maintains a high standard with regard to itsproduction as well as a broad product range. Getting afoothold in this industry is difficult since both productionfacilities and infrastructure represent major investments,and because it is also extremely challenging to acquiresufficient levels of metallurgic and technical expertise.Scana is one of few players in its area with integratedproduction facilities that include both melting/productionof steel, heat treatment and machining of components.Few of Scana’s competitors have their own steelworksand have to buy billets and semi-finished goods in orderto be able to offer finished steel products. This givesScana a clear competitive advantage, which the groupwill develop further.In the period from 2008-2010, more than NOK 200million has been invested in the steel companies. Theinvestments increase capacity and delivery precision,and reduce risk and production costs. In 2010, Scanaexpanded the production capacity in China with regardto rolls and larger rings. Scana’s investments alsoincluded a new forge manipulator at Björneborg, whichis able to handle tonnage up to 75 tonnes and lengthsup to 24 metres.ProductsScana is a leading supplier of specialised products insteel and customises solutions for various uses. Keyelements are close collaboration with the customer andhigh quality. Scana’s technological expertise is pivotal tothe production and in connection with the developmentof new, customised products. Scana’s productioncapacity in terms of steel produced in-house is around150,000 tonnes of melted material.Scana offers a broad range of products weighing from50 kg to 45 tonnes, in lengths up to 24 metres. Scanais a market leader in the upper weight and length range,particularly with regard to cylindrical products. Scanahas a large capacity within heat treatment. This renderspossible specific material qualities and extended tensilestrength, an important competitive advantage.Markets and customersOur special products provide us with customers amongthe great international players in industries such asmarine, oil/gas and energy. Scana offers optimumdesign and material alternatives, which, combinedwith short delivery times and good logistics, provide acompetitive total solution.Special steel customers are primarily steel companies,major wholesalers and end users. Scana has enteredinto several long-term collaboration agreements with anumber of key customers. This provides a good basisfor developing the business concept further.The development is heading in the direction ofcustomers requesting supplies of finished productsdelivered directly to their own facilities. High quality andtechnical expertise, combined with precise deliverieshave all helped Scana capture a strong position in themarket.