RHI Magnesita (RHI) has forecasted a 20pc decline in sales volumes across its steel and industrial divisions in Q2 2020, compared with the previous quarter. The company will not release its audited financials for the period until August.
Demand levels are likely to remain subdued through July and August, RHI reported, with limited visibility for forecasting beyond the period due to uncertainty in the markets on unknown COVID-19 factors. Demand levels in Q1 2020 were similar to the prior quarter with the steel division revenue in 2019 at €2bn ($2.3bn) and €904mn for the industrial division.
Steel customer activity encountered an unprecedented slowdown and fall in demand during May and June. Raw material prices fell through the first four months in 2020, driven primarily by oversupply from China though raw material prices stabilized in May and June.
Cement and Steel demand remained resilient in MEA/Asia in Q2, but demand for steel in Europe, South America, and India weakened as refractory orders were canceled on revised production schedules.
The company is focusing on continued cost management, cash preservation, working capital management, increased regionalization, and increased digitalization to address COVID-19 changes as well as part of the long-term strategic plan.
RHI is a supplier of refractories to the steel, cement, nonferrous metals, and glass industries.