Annual report 2015

Železiarne Podbrezová a.s. Annual report 2015 Conclusion The steel industry in Europe faces a difficult situation. Excess production capacities in global markets, record-low oil prices and cheap imports of steel products from China exert mas - sive pressure on sales prices. The market position of Žele - ziarne Podbrezová a.s. as a Slovak manufacturer of seamless steel tubes market position is negatively affected by higher energy prices compared to competing manufacturers in Eu - rope and by imports of rolled tubes from Ukraine. Železiarne Podbrezová a.s. faced very difficult market con - ditions in 2015, and this unfavourable situation persists in 2016 and the market recovery is very weak. We can expect at best only a slight increase in prices of purchased scrap steel. However, the global development of urbanisation, the de - velopment of shale gas mining, and continuous demand from the automotive industry means there is always a future for steel tube production industry, despite the uncertainty caused by excess production capacity. The Company’s Board of Directors considers the 2015 re- sults very positive. They represent a success of the Compa - ny‘s management and all employees, including all the em - ployees of subsidiaries. Perhaps the greatest success in 2015 were the econom - ic benefits of investments in upgrading the technological equipment of the steel mill and rolling mill for seamless pipes in previous years. The optimisation of parameters of continuous casting of steel and the change in the diameter of casts resulted in additional savings and in higher-quali - ty steel, which was reflected in a reduction in costs of the production of seamless hot-rolled tubes and precision cold- drawn tubes. We have created the conditions for high-quali - ty steel production for decades to come. These savings were a major source of profit in 2015. The 2015 profit amounted to EUR 3 735 187. Earnings per share amounted to EUR 1.57. Therefore, we also propose this year that the General Meeting also pay dividends to shareholders from retained earnings from previous years. Subsidiaries and associates also actively contributed to the consolidated results of Železiarne Podbrezová a.s. Revenues from sales within the consolidation group amounted to EUR 428 458 thousand. A profit of EUR 3 839 thousand was at - tributable to Železiarne Podbrezová a.s. as the consolidating company. In 2015, the Company’s performance was below the levels of previous years. However, it remains a guarantee for the co-operating small and medium-sized entrepreneurs in the region. The adequate utilisation of production capacities enabled the Company to maintain employment and the in - come of the population in the region. Železiarne Podbrezová a.s. strengthened its position as the most significant employ - er, and remained a guarantor of social security in the Brezno district and the Banská Bystrica region. Thanks to its great flexibility, Železiarne Podbrezová a.s. is ready at all times to react dynamically to new business op - portunities. The Board of Directors of Železiarne Podbrezová a.s. wishes to express its gratitude and appreciation to all colleagues, as without their contribution, these results could not have been achieved. Additionally, we would like to extend our thanks to our suppliers, customers, banks and financial in - stitutions, and to all our business partners for their cooper - ation. We hope our good business relations will continue to develop successfully in the future. We thank you for your trust. Approved by the Board of Directors’ decision on 12 May 2016 37 Report by the Board of Directors on Business Activities, Assets, and Financial Performance in 2015 and Information on the Business Plan