SMS Group Increases Order Intake
Jun. 13, 2012
The SMS group, an amalgamation of companies involved in metallurgical plant and machinery construction, had sales of €3.070 billion in its 2011 business year, slightly higher than 2010’s sales of €3.036 billion. The net group result of €265 million was also slightly above that of the previous year (€262 million).
The two business areas, SMS Siemag and SMS Meer, profited from further recovery in the markets. Order intake by SMS Siemag was €2.007 billion and SMS Meer won orders of €1.365 billion.
“Despite a decreasing willingness among our customers to invest in major projects, we expect to maintain order intake in 2012 at a level comparable to the previous year,” commented Dr. Heinrich Weiss, chairman and CEO of the SMS Group. “Considering our high order backlog, we are also confident that sales and results in the coming two years will remain at a similar volume to that of 2011.”
The market for metallurgical plant and machinery construction recovered slightly in 2011, SMS said. However, the high economic uncertainty in the euro-zone and some other markets means many customers are postponing or completely canceling investments.
The main sales markets remain China, India and South-East Asia. SMS notes increased demand for aluminum plants in China. For many years, business from China has made up around 20% of overall business volume in the SMS group.
Business with new plants continues to be slow in the industrialized countries, but the technological trend toward higher steel qualities has boosted modernization orders. There is also increasing demand for innovative environment protection products and solutions for improved energy efficiency.
SMS expects further growth in India, China, South-East Asia, and the Middle East. With the exception of China, these regions have a comparatively low per capita steel consumption.
The unsolved debt crisis in Europe and the U.S., political instability in the Middle East, and highly volatile raw materials prices make the development of these markets uncertain.