Update on overall statement by Salzgitter AG Executive Board

Reading time: min

Having emerged from the trough of the most severe economic crisis since the end of the Second World War, the Salzgitter Group's situation can still be considered exceptionally sound.

Although the catastrophic capacity utilization situation of many companies in the first half year, the extensive accounting related measures and necessary impairments carried out on Group assets resulted in a significant loss in the financial year 2009, the Group's ability to survive was never in question.

On the contrary, our broad based business with its manifold mix of products, customer sectors and suppliers structures succeeded in at least partly cushioning the on occasion extremely critical developments in individual customer sectors. Our long standing and reliable customer relationships that are anchored in technical competence and strong service orientation proved to be exceptionally valuable, particularly in the crisis.

With more than EUR 1.9 billion in cash and cash equivalents and an equity ratio of almost 50%, the Salzgitter Group enjoys a healthy financial base which gives us sufficient leeway to shape the months ahead in an uncertain economic environment with confidence. In this spirit, we will also bring our investment program to a successful completion. Our Profit Improvement Program, with its long term horizon and the flexible implementation of supplementary short term measures, has made radical groupwide restructuring measures mostly superfluous to date. The structural measures initiated in parts of the Group are implemented in a low key and consistent manner.

We will also pay special attention in the coming months to safeguarding the robust constitution of our business. We will respond to an improvement in the framework conditions by cautiously expanding our existing business activities, for example, by taking capacity lying fallow into operation again. Only once there is a foreseeably sustainable stabilization of the economic environment will we regard it tenable to consider key strategic growth measures.