Expected Financial Position

In 2006, the Salzgitter Group has again planned for a higher investment budget over the previous year. Around 70% of the budgeted sum is accounted for by the Steel Division, of which 58% is accounted for by SZFG. We expect our selective investments to deliver a significant improvement in our earnings.

Together with the ongoing investments already approved in previous years, the payment-related portion of the 2006 budget will bring the total investment volume to a level which is significantly higher than in 2005 (€ 262 million).

As in the past, these investments will be carried out on a rolling basis in accordance with developments and liquidity.

Owing to the rising volume of investments, the funds required for the year 2006 will be higher than the write-downs, with the result that the excess portion will need to be financed as planned from the available funds. From the standpoint of company management, this is not an issue as there is enough latitude.

The volume of investments has been assessed and distributed over time to ensure that the Group's cash position generally remains stable and available at any time for strategic options. Financing measures have therefore not been planned.