Trinecke Zelezarny, in 2019 had its worst year since the 2008 financial crisis. The company’s net profit plummeted 82% in 2019 to CZK 610 million. Revenues from the sale of products, goods, and services fell by two billion to CZK 38.4 billion.
Trinecke Zelezarny blames last year’s challenging market situation for its poor performance. The European economy struggled last year due to the US-China trade war, the influx of cheap steel, and weak demand in the automotive industry. The dramatic rise in the prices of emission allowances also had a negative effect.
The company says this will be a challenging year. “Before the pandemic, we expected higher crude steel production than last year. However, current market conditions, especially with regard to sales prices, are not favorable,” said Jan Czudek, CEO.
According to Czudek, the company will be affected by the weak growth of the European economy, uncertainties associated with changes in the automotive industry, insufficient protections to stop the influx of cheap steel into Europe, and COVID-19.
Trinecke made CZK 2.195 billion in capital investments in 2019. The company is reconsidering its planned capital investments of CZK 1.4 billion this year due to the pandemic’s economic fallout.
The steelworks produced 2.508 million tons of crude steel in 2019, about three percent less than in 2018. Trinecka is the largest metallurgical company in the Czech Republic, with 10,000 employees.