Sif’s Half-Year Results Confirm Anticipated Slowdown
What Sif Group had been expecting and preparing for when it comes to this year has been reflected in the company’s results for the first half of 2018.
Namely, the under-utilisation of the company’s 300 Kton annual production capacity had materialised during the fist six months, with a total throughput of some 81 Kton steel, compared to 108 Kton in the first half of 2017.
Production volume in the second quarter amounted to 29 Kton, with the production in the last few weeks of the quarter being almost zero, which led Sif to decrease its temporary workforce and to reduce its total staff from approximately 615 employees at the start of 2018 to around 320 by the end of the first half of 2018.
Even though production resumed in July, this is not yet expected to result in any significant increase in the third quarter, and for the full year 2018 Sif expects to utilise around half of the maximum annual production capacity.
Looking at 2019 and beyond, the foundation manufacturer said its outlook remained positive and informed it entered into exclusive negotiations for projects for 2019, totalling approx. 115 Kton in production volume.
“Our order book is filling up with 200 Kton for 2019 and 90 Kton for 2020, and we are seeing a healthy flow of projects which can largely cover the remaining capacity for next years. Momentum for offshore wind energy has returned, with new projects without government subsidies, a further reduction in LOCE for offshore wind energy in Europe, and a growing interest from the United States and the Far East,” said Leon Verweij, the company’s CFO and acting CEO.
Of the approximately 81 Kton produced in HY1 2018, 78% was for offshore wind and 22% for offshore oil & gas.