1.6.2005
In 2004, which was the third full calendar year of the company’s independent business activities, VÍTKOVICE STEEL generated historically the best profit since the foundation of the company – the audited pre-tax profit was 1.56 billion CZK with sales amounting to 13.5 billion. In comparison with the profit in 2003, which was 143 mln. CZK, the company increased the profit from year to year by more than ten times.
Thanks to this multiple increase in profit, own capital of VÍTKOVICE STEEL for the first time was higher than basic capital. Basic capital of the company is 2.6 billion CZK. Own capital increased last year to 4.0 billion CZK, while in 2003 it was 2.5 billion CZK. Another interesting figure is the return on sales which in 2004 increased almost to 11.8 %. The substantially positive changes in these parameters prove that the restructuring of the company together with the global boom on the steel market yielded its fruits.
„The 2004 was a good year for steel makers. The demand for rolled steel products from VÍTKOVICE STEEL was higher than our production capacities and so we were struggling with an untypical task to satisfy the demands of our customers mainly on the domestic market,” said Vladimír Bail, BOD Chairman and CEO of VÍTKOVICE STEEL, a. s. when commenting on 2004. „Objective external impacts were pressing us to increase production in all cost centers of VÍTKOVICE STEEL, a.s., which means that we had to reduce inventory of our own products – semi-finished products, work-in-progress and finished products. The situation on the market was virtually forming the external as well as internal economic results of the company. The value of sales from own products increased by 49 % from year to year which into large extent was caused by an increased share of supplies to the domestic market. The year-on-year increase in the volumes of supplies on this territory in all product groups from our company was more than 30%. On the other hand, export dropped by 13 %. Currently, domestic sales make 44 % of the total sales of the company. With a share of approx. 50 % on the heavy plates market in the Czech Republic we have become a key player on this territory,“ added Bail. The success and development of the company is evidenced also by a growth of value added. Last year, value added was more than double times higher than in the previous year, i.e. value added increased from 0.99 billion CZK to 2.42 billion CZK.
The objective of VÍTKOVICE STEEL is keep the sales of higher value added products increasing. This includes for example supplies of cut shapes or plates for production of line pipes. And also in these segments the company was successful last year which had a positive impact mainly on the company’s sales. The production of cut shapes for example increased by 38 % against 2003. The most important supplies in the long products area were sheet piles which traditionally make on average 50 % share of supplies from the sections rolling mill. This type of products made in VÍTKOVICE STEEL, a. s., has found its use for example even on the most important construction activity in the Moravian and Silesian Region, i.e., the construction of D47 motorway. An important milestone, which will be recorded in the history of VÍTKOVICE STEEL, is also the last year’s expansion of the product mix by a new type of sheet piles VL 606 and beams HE 260.
VÍTKOVICE STEEL was founded as an independent subsidiary company by an entry in the Commercial Register on March 7, 2001, and the company started carrying out the real business activities on August 1, 2001, when the steel making division of the former VÍTKOVICE, a.s., was separated as an independent subsidiary company. Today the company is internally divided into 6 cost centers, of which 4 are of a production nature and 2 of a non-production nature. The production part of the company is represented by the following cost centers: Steel Plant (2 OXYVIT converters, secondary metallurgy, ladle furnace, continuous caster, ingot casting), the Sections Rolling Mill, the 3.5 Four-High Rolling Mill (this cost center includes also the 4.5 Two-High Mill) and Cut Shapes. Currently, VÍTKOVICE STEEL is employing some 1600 people, of which some 1200 in the key shops – some 400 in the steel shop, 800 in the rolling mills. This Ostrava-based company produces steel and rolled products (heavy plates, heavy and medium sections, cut shapes). In the heavy plates area the company ranks among the most important European producers. In the Czech Republic the company is a dominant producer of heavy plates. The perspective product mix is completed by sheet piles. On the domestic market, VÍTKOVICE STEEL is an exclusive manufacturer of sheet piles and part of their production is exported.
In 2004, VÍTKOVICE STEEL was carrying out its business together with its tolling partner, i.e., OSINEK, a.s. The tolling agreement was terminated on January 31, 2005 and today VÍTKOVICE STEEL is a self-financing entity.
