Voestalpine downgrades business-year outlook on effects of coronavirus

Austrian steelmaking group Voestalpine has downgraded its outlook for business year 2019/20 - April 1, 2019 to March 31, 2020 - because of the negative effects it expects the coronavirus to have both operationally and in terms of non-recurring effects, the company said on Tuesday April 7.

The outbreak of Covid-19 has already hit the heart of the European economy, with widespread closures of car-manufacturing sites across Europe, as well as shutdowns and capacity cuts across various sectors, axing demand in Voestalpine’s key customer segments.
Covid-19’s effects on business year 2019/2020 earnings
Voestalpine estimates that Covid-19 - the effects of which began to be felt in mid-March - will affect around €40 million ($43.2 million) in its operating results - earnings before interest, tax, depreciation and amortization (Ebitda) and earnings before interest and taxes (Ebit) - for the business year to March 2020

Covid-19 has also resulted in a higher discount rate - or weighted average cost of capital (WACC) - so Voestalpine will have to make write-offs to the...

Published

Julia Bolotova

April 07, 2020

15:05 GMT

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