Wire Rod and Steel Bars with Higher Added Value Drove the Last Year’s Sales

Třinecké železárny (TŽ) sold goods and services in amount of CZK 32.217 billion in 2016. It is 4.7 billion less than in 2015. This is due to the fall in steel prices in the markets due to overproduction in Europe as well as in the third countries. Yesterday, the TŽ General Meeting concluded the fiscal year of 2016 with a positive result of CZK 1.44 billion after tax.

“It means a certain decrease compared to previous years. The overall decline in the economic conditions was accompanied by an increase in personnel costs as a result of the payment of extraordinary bonuses to employees of Třinecké železárny. However, the economic result is still higher than we have expected regarding the very difficult situation within the European steel industry," said Tomáš Chrenek, Chairman of the TŽ Supervisory Board.

Fluctuations in raw material prices and the impact of excess capacity have prevented the Thuringia steelworks from optimizing the product portfolio, thanks to which it managed to use full production facilities last year to produce 2,605 million tons of steel.

The sale of rails and railway accessories, the traditional product of TŽ, fell by almost 44 kt to 234 kt, mainly due to the lack of domestic orders.

The most sold product of Třinecké železárny in a long-term is wire rod, sales of it reached 983 kilotonnes, representing 34.4% of total sales in 2016. The sales of steel bars and profiles then amounted to 575 kilotonnes.

“By investing in new processing and refining capacities, the steel bars are supplied according to customer requirements in a rolled, heat-treated, peeled or drawn condition. By finalizing processes, we increase the added value of our products that is growing in the markets. They are used especially in the automotive and engineering industries," explains Ján Moder, Vice-Chairman of the Supervisory Board.

Last year, Třinecké železárny exported 68% of the products. The most important export countries include Germany, Slovakia, Italy, Poland and the USA.

The investment program of TŽ is aimed at further increasing the added value of the products as well as expanding the product portfolio. This year, the company plans to invest more than CZK 3 billion in the modernization of existing facilities and in the acquisition of new production facilities, a third will be eco-friendly projects.

The most important projects will be the modernization of the heart of rolling mills – the blooming mill. Partial changes are going to be made at the facilities producing iron and steel. “In a matter of weeks, we will start with the continuous casting machine, which will allow us to enter the market with round blooms of 600 mm diameter. Large diameters are one of the trends in the wind power sector, where the performance of wind turbines is growing," adds Jan Czudek, the CEO of Třinecké železárny.

The company perceives the price pressures as a threat of this year, this is connected to increasing imports from Iran, India and South Korea caused by global overproduction of steel in China and other countries. Another risk is caused by negotiating limits and allowances of the EU Emission Trading System for the period of 2021-2030.

Petra Jurásková
Press Secretary of theTřinecké železárny - Moravia Steel Group
phone: +420 558 535 841
mobile: +420 602 265 738
e-mail: Petra.Juraskova@trz.cz