The investment strategy has already gotten approval from the shareholders of Metal and the management of the Slovenian Steel Group
Metal Ravne, a subsidiary of the Slovenian Steel Group, is looking to step up investment in production as a result of its strong operations in recent times.
The company made a net profit of SIT 1.15bn (EUR 4.8m) in the first four months of this year, which means it has already exceeded its business plan for the whole of the year, company officials told the press on Tuesday, 31 May.
In the first quarter of the year, Metal produced 40,000 tonnes of steel, thereby exceeding production plans for the quarter and the output in the same quarter of last year.
According to general manager Darko Mikec, the strong operations have persuaded the management to undertake extensive investment in production.
Sales revenues in this period amounted to EUR 46.4m, rising by 66% over the first quarter of 2004. Around 80% of the sales were generated on foreign markets, primarily in the EU and the US.
"After a weak start to last year, we began operating better than expected, which is why we have decided to invest," Mikec said.
Five million euros are to be earmarked for modernisation plans this year, while the rest of the profit is to be set aside for next year, when the company plans to build a new rolling facility that will boost production, he said.
The investment into production also envisages the upgrade of the outdated sections rolling facility and the purchase of a flattening and cutting machine, Mikec added.
According to him, total investment in production and distribution is to amount to EUR 59m until 2010.
The investment strategy has already gotten approval from the shareholders of Metal and the management of the Slovenian Steel Group.
According to Tibor Simonka, chairman of the Steel Group, the time has come for the group to start investing extensively in order to upgrade and modernise its production facilities.
We were unable to do so during the period of restructuring, but now the strong operations have presented a window of opportunity, he said. According to him, investment in production will lay the foundations for future operations.
Source: Slovene Press Agency STA