The General Meeting of Třinecké železárny has concluded the year of 2008

The regular General Meeting of the joint stock company Třinecké železárny has made a fullstop after the previous year. THe steel company from Třinec thus achieved the after tax profit in amount of CZK 1.204 billion; according to the decision of the shareholders CZK 60 million will be allocated in the reserve fund and CZK 1.144 will be used as the accumulated profit brought forward for investments, introduction of new technologies, and the environmental projects.

Last years' results of Třinecké železárny were impacted by economical and financial crisis, which begun in the second half of the last year and stroke all steel companies as well. Even though Třinecké železány benefited from the favorable situation on the steel markets in the first half of 2008, the scond half lost all positive developments. Despite that fact, within last 15 years, 2008 ranks among the more successful ones.

„The year 2008 showed us two faces. The first favourable one lasted over the first three quarters of the year and continued the previous extremely successful period. The second one was characterised by a considerable drop of demand as a consequence of the financial crisis,“ told the shareholders Mr. Tomáš Chrenek, the Chairman of the Supervisory Board stating the fact, that the global recession perceivably hit Europe as well as CZech Republic as the steel consumption dropped by more than 20 per-cent year-on-year. „These trends will continue in 2009. Even optimistic forecasts do not expect improvement earlier than at the end of 2009. The return to the level of previous years will be slow and it could even last several years,“ he added then.

The changes inflicted by the crisis, especially the decrease of the export orders led in the unprecedented loss of the Czech economy performance, as well as in other EUropean countries, and resulted in higher inventories of goods and production in progress. The steel production in the Czech Republic dropped by nearly 10 per-cent from 7.1 to 6.4 million tons. The share of Třinecké železárny on this amount of production was 38.3 %, which represents the increase by 2 % in this share.

Despite the difficulties brought by the crisis, we succeeded in achieving profit before taxation in the amount of CZK 1.204 billion. In 2007, thanks to the global huge demand on steel the net profit amounted to CZK 3.633 billion. The operating profit dropped from CZK 4.372 billion to 1.377 billion. Revenues grew by more than CZK 1.5 billion to CZK 37.085 billion.

<cite>„Regarding the economy, it wasn’t a bad year, but it definitely was not as successfull as the previous ones had been,“</cite> stated <strong> Mr. Jiří Cienciala, Chairman of the BoD and CEO</strong> adding thef act , that due to the crisis the steel company had to regulate its production in the end of the year. Třinecké železárny produced 1983 kilkotons of hot metal comparing to 2074 kilotons in the preceding year. The sales of the rolled goods in 20087 dropped by 91 kilotons to 2301 kilotons.

The investment policy of the whole Třinecké železárny – Moravia Steel Group focuses recently to the renewal of the facilities, as well as introduction of environmental projects. Since 1997, Třinecké železárny has invested more than CZK 13 billion, whilst more than CZK 4 billion have been invested into the environmental projects.

Last year, the company invested CZK 1.01 billion; the most significant project was the modernization of the winding line „Garret“ for making coils at the continuous light section mill as well as completion of the de-dusting at the sinter plant No. 1. The subsidiaries invested CZK 1.5 billion into the improvement of the product quality and utility value. The most significant of them were building the new walking beam furnace at Sochorová válcovna TŽ (billet mill) in Kladno, reconstruction of the rolling mill Big Mannesmann at Válcovna trub TŽ (tube mill) in Ostrava and building the drawing machine Schumag at Ferromoravia (drawing mill) in Staré Město u Uherského Hradiště.

The Group welcomed two new members, which fit into the strategy of creation of product chains – Hanácké železárny a pérovny (production of springs) and Šroubárna Kyjov (production of bolts and nuts).

Last year’s average salary in the company, which employs ca. 5400 people and thus belongs among the biggest employers in Northern Moravia, amounted to CZK 27,402, this distinctively exceeds the regional as well as the Czech average. It represents the increase by CZK 603 comparing to 2007.

23.6.2009