Capital market and price performance of the Salzgitter stock
In the first nine months of 2011, the international stock markets were determined by a great degree of uncertainty and nervousness. The uptrend, which has generally held steady since the fourth quarter of 2010, continued initially until profit taking caused a marginal consolidation in February. The earthquake in Japan on March 11 resulted in a severe contraction, followed shortly thereafter by a counter movement, prompted by healthy economic data, which persisted through to May. The debate about the public finances of several countries in the euro zone which started in early summer triggered a phase of high stock market volatility. In July, stocks rallied temporarily, a movement that was, however, followed by prices tumbling rapidly in the same month as efforts on the political front to solve the meanwhile open outbreak of the euro crisis out were deemed insufficient by the capital market. The DAX had shed around 20 % overall by September 30, 2011, compared with the closing price at year-end 2010; the MDAX fell by 18 %.
In times of such uncertainty many investors prefer reputedly defensive investments to the detriment of the shares of companies in cyclically sensitive sectors such as the steel industry. Similar to the equity prices of our competitors, the Salzgitter share was therefore severely impacted by the lackluster sentiment on the stock exchanges during the reporting period. The share price had already peaked for the year to date on February 8, when it posted € 65.64. As early as April, we were given a first glimpse of the impact of the immanent discussions about the economy on steel equities: investors responded to news about industry and the economy with pronounced buying or selling activities which took on partly extreme dimensions at the end of July after the start to the euro crisis. For instance, on August 11, following the publication of the half-yearly figures and guidance, which had been revised upwards, the share price climbed by at times more than 23 %, a price movement which is most unusual for an established industrial company. From this day onwards, our share outperformed the European Steel Index. It was, however, unable to generally decouple from the overall market trend despite multiple confirmation of the outlook for business and the still exceptionally sound financial position and strong balance sheet of the company. The overall performance of the Salzgitter share in the period under review came to –27 %; the steel index shed 50 % of its value.
In current analyst coverage conducted by 22 banks, the Salzgitter share has been assessed with the following recommendations (as per September 30, 2011): 14 buy/outperform, 7 hold/market perform, 1 sell/underperform.
The average daily turnover of the Salzgitter share on German stock exchanges came to approximately 395,000 units at the end of the first nine months of 2011. On September 30, 2011, Salzgitter AG held in 6th place measured by turnover and took 15th place in terms of free-float market capitalization in the MDAX ranking of Deutsche Börse AG.
As part of its capital communications work, the Salzgitter Group made presentations at investor conferences in Hamburg, Frankfurt, London, Zurich and New York in the period under review. In addition, we held road shows in Vienna, Milan and Lugano and received visits from investors and analysts at our plants in Salzgitter, Peine and Mülheim an der Ruhr. In mid-August, the results of the first half of 2011 were presented at analysts' conferences in Frankfurt and London and discussed in detail with the capital market.
Information for Investors
1) All data based on prices from XETRA trading
2) Calculated on the basis of the respective closing price at the end of the period multiplied by the number of shares outstanding per this date