Strategic Direction of the Group

The Group strategy is geared towards sustaining its independence, profitability and selective growth and is designed to deliver continued value added. There are thus no plans to change the business policy of the Group in the years ahead.

Organic growth, in particular on the basis of effective, profitable structures with a proven track record, is highly prioritized, especially in an overheated environment, as a currently extremely costly option of external growth through acquisitions. For this reason, a series of measures are being pursued throughout the Group with the aim of implementing corporate goals under a strategic concept.

A special part of this is a disciplined approach to the Profitability Improvement Program aimed at cutting costs, improving productivity, product qualification and enhancing quality.

Pre-defined, cooperative action is further supported by the ongoing implementation of our Corporate Guidelines with its system of collectively and individually agreed goals. This system is used as a basis for implementing performance-related remuneration models which are linked to objective criteria.

There are also plans to dynamically step up the deployment of cutting-edge information technology compatible in the Group environment for internal and external applications.

The business activities of the companies in the various divisions will fundamentally concentrate on established sales markets in the short term. In doing so, there may be a shift in the focus at a regional or sectoral level to accommodate requirements. The shape that this will take will ultimately depend on short-term responsiveness and the regional or sectoral good positioning of the companies. Opportunities on markets not frequented to date are being reviewed and exploited if there is commercial or technical potential. Together with an active monitoring of the market to identify, depending on delivery possibilities, new potential markets, this is part of our routine work.

The use of fundamentally new technological processes and techniques has not been planned for the two-year period under review here. But in order to reinforce their market share as manufacturers of market high-grade rolled steel products and steel tubes, the companies of the Steel and Tubes Divisions intend to invest in modernizing the various production stages. The primary aim, alongside cutting costs, is product qualification and enhancing quality.

Insofar, over the next two years the Salzgitter Group will not add any products and services to its portfolio of products and services which are ”new and not currently part of its offering” in the sense of ”completely different”. This having been said, however, it will offer ”new” products which represent qualitative progress through further development and additional application fields. In this context, we refer to the section on ”Research and Development”.

In the beams segment, there are plans to extend the product range to special profiles. Our plate mills concentrate increasingly on higher quality grades, as the underlying assumption is that demand for these products in particular will remain stable at attractive prices. In the tubes segment, products made of new grades of material for more sophisticated areas of application are expected to deliver differentiation as against providers of standard products.