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09/05/2017

PAUL WURTH: WELL-PREPARED TO FACE NEW CHALLENGES

Paul Wurth: well-prepared to face new challenges

Under the chairmanship of Michel Wurth, the Ordinary General Meeting of shareholders of Société Anonyme Paul WURTH was held on 9 May 2017 to approve amongst others the financial statements of the year 2016.

Despite unalterably fragile and investment inhibiting business conditions, there was positive news for the Paul Wurth Group in 2016, in particular with regard to the strongly increased order intake. At the same time, innovative and future-oriented projects, especially in the field of digitisation, were in the focus of the company’s growth initiatives.

Economic climate and commercial situation

In 2016, the global business climate in the steelmaking industry did not significantly improve compared to the previous year. The steel market continued to suffer from overcapacities combined with cheap imports from China, ever-smaller margins and a reluctance to invest on the part of the steel producers.

Despite this gloomy business environment, the Paul Wurth Group’s performance was very good, with new orders in 2016 up 17% to 435 million euros. Besides a few large projects, this increased order intake is above all the result of a large number of smaller orders for modernisation and servicing missions. First orders could also be gained in the new fields of activity that are pellet plants and valves for the oil and gas industry.

Operational activity

The largest contribution to the new order volume came from the project on behalf of Algerian Qatar Steel in Algeria, where Paul Wurth and its technology partner Midrex were awarded the contract to design and build a Midrex® direct reduction plant. In traditional integrated steel production plants, Paul Wurth secured two important projects in Russia. The first order consists in supplying key technologies for the Evraz Group’s new blast furnace at Nizhny Tagil. The second is a contract from Russian steel group NLMK to reline its blast furnace No. 6 in Lipetsk.

In cokemaking technology, Paul Wurth added an important reference with the successful commissioning of the new coking plant at Companhia Siderúrgica do Pecém in Brazil. In this sector, too, the Group landed a major order for the rebuild of two coke oven batteries at ArcelorMittal Asturias in Spain.

Paul Wurth Geprolux

Also worth mentioning is the excellent performance of the daughter company Paul Wurth Geprolux in Luxembourg, which nearly doubled its order intake for project and site management services in the field of construction and infrastructure projects. The references of Paul Wurth Geprolux now include some more prestige projects, such as the new national football stadium, the “Südspidol” hospital and another dairy factory.

Results for the financial year 2016

While turnover for the year (362.0 million euro) was down in comparison with 2015, which is partly the result of the low order intake registered in the years 2013 and 2014, Paul Wurth closed the financial year 2016 with earnings before taxes of 15.1 million euros and a net profit of 8.4 million euros. The General Meeting approved the payment of an unchanged gross dividend of 157.5 euros per share on account of the 2016 financial year.

Innovation and Industry 4.0

For Paul Wurth, new product development and innovation has always been the key to be successful in the market and against competition. In 2016, the Group’s major R&D activities focused mainly on environmental and energy-related topics with regard to blast furnace, cokemaking and agglomeration plants.

In view of the plans to reform the European Emissions Trading System, the Group will certainly be concentrating its research efforts on the issue of CO2 in future. As a leader in hot metal production technologies, Paul Wurth will naturally be involved in the development of alternative process routes, such as a hydrogen-based reduction process, and is also currently exploring the chemical conversion of waste gases into high-yield products.

Beyond traditional research and development, Paul Wurth would like to generate new growth opportunities by investigating other innovation paths. In the context of an extensive innovation programme, considerations about Industry 4.0 provided the impetus for the development of several projects with regard to the use and interconnectivity of digital data. In close collaboration with customers, several digitisation projects were identified and work has already started on these. In this context, Paul Wurth is working, together with SMS group, on a concept of intelligent metallurgical plants.

Paul Wurth InCub

Paul Wurth’s business incubation programme, Paul Wurth InCub, has got off to a very good start. More than 50 applicants responded to the first official call for projects; 25 of these presented their start-up projects before a Paul Wurth jury. In the months that followed there was active cooperation on a wide range of innovative topics. To date, eight start-ups have already signed membership agreements and the first entrepreneurs moved into the offices of the newly-renovated Paul Wurth InCub House.

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PAUL WURTH S.A.

 32, rue d'Alsace

 L-1122 Luxembourg

 LUXEMBOURG

 P.O. Box 2233

 L-1022 Luxembourg

 LUXEMBOURG

 Tel.: (+352) 4970-1

 Fax.: (+352) 4970-2209

 paulwurth@paulwurth.com

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