Positive forecast for the current financial year

Executive Board Chairman Wolfgang Leese and Executive Board member Finance Dr. Heinz Jörg Fuhrmann presented “far above-average results for the financial year 2004” to around 30 journalists at the Annual Results Press Conference in Salzgitter.

Dr. Fuhrmann commented on the key data for the financial year 2004 as follows: With pre-tax earnings of EUR 322.8 million, the Group generated a record result. Consolidated sales rose to an all-time high of EUR 5.9 billion. ROCE (return on capital employed) stood at 24.4% and “exceeds the target of 12% set for the duration of the cycle”, was Dr. Fuhrmann’s explanation. He went on to say that the Group had way outstripped the profit forecast even though there was a high level of provisioning and one-off expenditure that had to be absorbed. Dr. Fuhrmann cited the in part outstanding business developments in the Trading, Steel and Tubes divisions as the reasons for the record performance.

Pending approval by the General Meeting of Shareholders, Dr. Fuhrmann announced that dividend of EUR 0.40 would be paid per share. "With a dividend yield of 2.5% (based on the share price as per March 23, 2005), we have achieved a presentable result compared with all segments of the stock exchange”, he commented.

Executive Board Chairman Wolfgang Leese’s interim assessment of the growth strategy was positive: "In the last six years, consolidated group sales have risen 120% to EUR 5.9 billion.“ As the company has done "most of its homework over the past two years, there is once again an opportunity for selective growth.” The global consumption of steel is still on the rise, explained Leese. This is driven in particular by the great demand for steel in China, which in future, however, will show lower growth rates than in the recent past. Demand for steel and the extremely high cost of raw materials for ore, coke, scrap and coal as well as freight prices “will push the price of steel up still further" was Leese’s prediction.

Executive Board Chairman Wolfgang Leese stated the following forecast for the year 2005: “Based on current information and the expectations for the development of the procurement and sales markets, as well as the general conditions, and taking account of the effects of the projected internal measures, we anticipate that profit before tax will be in the triple-digit million range again. It may approximate to the level of the result in 2004.”