The stainless steel recycler ELG Haniel again recorded a significant contraction in its turnover and profits in 2013. The company faced decreasing demand for stainless steel products and lower raw materials prices, particularly for nickel, according to the annual report published by its parent company Franz Haniel & Cie GmbH on Monday. At the same time, scrap availability on the procurement market was low as many suppliers were holding back material in the expectation that prices would climb again.
In this difficult market environment, significant decreases were observed for both ELG’s stainless steel scrap output tonnage (-8 per cent to 1.2 million tonnes) and revenues (-20 per cent to €1.88bn). In spite of a high level of ongoing competitive pressure, the company was able to improve the margin in its stainless steel scrap business through a selective procurement and sales policy. However, it had been impossible to prevent an 11 per cent decline in operating earnings, which brought the figure to €47m.
Haniel did not anticipate a significant, lasting recovery in the stainless steel business in the current 2014 business year. Nevertheless, ELG expects an increase in output tonnage by a high single-digit percentage figure, as the division will benefit from rising demand in the US. The company also pins its hopes on the superalloys business area, which it expanded last year through two acquisitions, one each in the UK and the USA.