Marcegaglia opens to partners in China: advisor PWC entrusted for the research
Positive first quarter
"We're coming off a first quarter that I surely define positive - said Antonio Marcegaglia, President and CEO of the homonymous group - the volumes are slightly better than expected (+ 1%, which mens 1.78 million tons), and despite a 4% decline in revenues we reached an almost doubled Ebidta compared to the previous year (equals to 10% of sales), thanks to a judicious purchasing policy and a recovery of the apparent demand”. For the upcoming future, the Italian manager expects the same positive trend for all 2016. Marcegaglia also confirms the purchasing of raw materials from Ilva as much as possible, although the Italian mill in Taranto (Southern Italy) is working at lower rates than in the past, also because it’s moving toward a more verticalized production. Situation that lead the major Italian manufacturer of flat products to search for raw materials' suppliers abroad.
The extension of the duties could hurt distributors and transformers
"Today we are responsible for 60% of Italian imports of coils - explains Antonio Marcegaglia - but this is also due to the fact that Europe and especially Italy struggles to meet domestic demand nowadays. First due to Ilva limitations. It's clear that if we look at the imports of coils we can see some peaks, but we have also to consider that Italy is a net exporter of steel pipes and galvanized products, so part of the imported products are then re-exported in these shapes. For these reasons we are very concerned about recent requests of Eurofer for the extension of duties to other countries. While in China the situation is clear, in Russia, for example, the context is very different. Considering the supply limits I have already described, the real risk is that European Companies could be damaged rather than supported, and I believe that even the steel distributors can agree with me”. Marcegaglia has also drawn attention to the fact that markets such as Iran and Turkey still have strong domestic consumption, so aggressive exports are unlikely, such as occurs in some Asian countries.
Open to partners for China's asset
After having focused on the latest news, the President of the Italy-based group looks also to the future of new and old assets. "As for our relationship with Iran, I confirm that we are in the preliminary/study phase for a new production unit of stainless steel tubes with Mobarakeh, a projects that is proceeding carefully since even the financial system still has doubts about investing in this country. Instead, we started positively the operations in Turkey: at the moment we are commercializing an average of 400/500 tons per month and I think we will fulfill the purpose of 10 thousand tonnes per year. As for the Chinese asset we decided to open to a partnership and we entrusted the advisor PWC to research potential partners”.