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Emirates Steel reports 22% jump in revenues to Dh 6.6 billion revenues in 2017

Emirates Steel, one of the largest steel industries in the Gulf, reported a 22 percent jump in revenues to Dh6.6 billion in 2017, compared to 2016. The company’s production rose marginally to 3.2 million tonnes by the end of 2017, up from 3.1 million tonnes in 2016.

It’s export sales accounted for 20 percent of total volumes, with the remaining 80 percent being consumed within the UAE.

Engineer Saeed Ghumran Al Remeithi, Emirates Steel’s Chief Executive Officer, said: “The positive results achieved by Emirates Steel in 2017 clearly indicate success of the company’s resilient business model, despite the challenges faced by the metals and steel industry globally.

“The increasing demand for Emirates Steel’s products in the international markets is testament to their high quality, which will open further doors for entering new emerging and developed markets. We will continue to increase sales revenues and reduce direct and indirect costs to further improve the company's financial performance. This will be achieved by increasing volumes, driving efficiencies and further developing our product range to achieve our production capacity of 3.5 million tons per year, raising safety standards and entering new markets to further expand our global footprint,” he added.

“Having delivered year on year growth, the company continues to enhance its position as a world class steel manufacturer, providing the highest quality products, services and solutions to our customers.”

Emirates Steel has recently developed a scrap shredding facility that supports increased efficiencies in the operation of the electric arc furnaces. This new facility will play a major role in re-cycling scrap metal available in the Emirates, as well as reducing operating costs and increasing flexibility for the primary feedstock used by the company.

In addition, the company has successfully designed and developed a twin-casting system, the first of its kind in the UAE, that will enable the company to further increase volumes. The success of this new technology was confirmed on commissioning in July 2017, as it had increased the production capacity of Steel Casting 2 to 20 percent.

“Emirates Steel continues to focus on manufacturing high quality steel products to meet the needs of a growing construction market and the huge infrastructure projects ongoing in the UAE and the GCC. Our heavy structural steel sections are used in the construction of bridges, roads, giant residential towers, airports, ports and in the construction industry for industrial and engineering applications,” said Al Remeithi.

“We will rely heavily on the heavy sections mill when implementing our expansion strategy, further targeting new markets" he added. “The plant was commissioned in 2013 with production reaching 540,000 tons per annum in 2017.”

Al Remeithi added: “In addition, the company has continued to produce rebar and increase its production to 2.2 million ton per annum in 2017, compared to 2.1 million tonnes per annum in 2016.”

The company is currently diversifying its product strategy with the development of value added products such as specialist steel wire rods as used in a diverse range of applications - from the automotive sector to the manufacture of furniture. The company's heavy sections team has successfully developed a range of highly technical sheet pile products, the “ES-Z” range as part of Emirates Steel’s development strategy.

The company has implemented various cost control measures and this, married with the enhanced efficiencies and availability of the plants, has reduced the manufacturing costs per ton of steel (excl. feedstock) by 37 percent in the period from 2012 to 2017. Similarly the overhead costs per ton of steel has been reduced by 25 percent in this period. An independent benchmarking exercise conducted by Wood Mackenzie having positioned Emirates Steel as a top quartile player in terms of the world’s most efficient producers.

Around 21 percent of Emirates Steel workforce is representative by UAE nationals, with 75 percent of UAE nationals leading the executive management. The company plans to increase its overall Emiratization ratio to 34 percent by 2020, providing UAE Nationals with an opportunity to contribute to its growth and to the Economic Vision of the nation.

Currently, Emirates Steel employs 2,228 personnel across all divisions and facilities, with 467 of the them being UAE Nationals, including 76 engineers, 307 technicians and 84 managers.

Emirates Steel is owned by Senaat, the UAE’s largest industrial conglomerate and a driving force for implementing the Abu Dhabi government’s industrial diversification policy. Strategically located in the Industrial City of Abu Dhabi, some 35 kilometers away from the heart of the city of Abu Dhabi, Emirates Steel is the only integrated steel plant in the UAE, utilizing the latest rolling mill technology to produce rebar, wire rod and heavy sections.

Established in 1998, Emirates Steel grew in a relatively short period of time from a simple re-roller of imported steel billets to a complex integrated manufacturing plant, using modern solutions to tackle traditional industrial problems to generate value for its various stakeholders. In 2012, the Company began producing at a capacity of 3.5 million MTPA, following two expansions and the investment of around Dh11 billion (US$3 billion).