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Van Leeuwen Pipe and Tube Group ends 2003 in profit
Van Leeuwen Pipe and Tube Group
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Company: Van Leeuwen Pipe and Tube Group, Netherlands
Attn: Petra van Zandvoort

Zwijndrecht, The Netherlands, 24 May 2004 Van Leeuwen Pipe and Tube Group made a modest profit of 1.2 million over the 2003 financial year (2002: 0.6 million). The profit improvement is largely attributable to good results outside Europe, cost savings and lower interest charges. Turnover fell by 12% to 356 million (2002: 403 million) mainly due to the deconsolidation of operations in Germany (as of 1 April 2003, the German operations have been incorporated into a joint venture with Benteler Handel). The operating profit for 2003, which improved substantially through cost reductions and the deconsolidation in Germany, was 6.4 million (2002: 4.7 million). Furthermore a substantial fall in interest charges to 2.0 million (2002: 2.6 million) had a beneficial effect on the result. The costs resulting from the reformed structure in Germany restricted the growth in the Group's net profit. The financial position remains equally strong, with a further increase in solvency to 39.6% (2002: 37.1%), partly due to control of the operating capital and deconsolidation in Germany.

The year 2003 was characterised by difficult market conditions due to stagnating markets in Europe and strong growth in operations in Asia and the Middle East. In spite of this difficult market Van Leeuwen Pipe and Tube Group largely achieved its targets for 2003: growth in profit and turnover outside Europe, the creation of a divisional structure and an increase in the number of younger managers in senior positions. Important progress was also made in the areas of internal control, e-business, logistics and transport.

The investments in growth and capacity in Asia, the Middle East and France produced good returns. Furthermore, traditionally profitable operating companies such as Van Leeuwen Precisie, Van Leeuwen Stainless and the operating companies in Australia and Canada also achieved very satisfactory results, equal to or better than those achieved in 2002. The results of the other European operating companies stabilised and were similar to the results in the previous year. The result of the largest operating company, Van Leeuwen Buizen in Zwijndrecht, the Netherlands, remains insufficient to enable the Group to meet its profit requirements over the long term. Good results in exports and projects were unable to compensate for the decline in the construction and shipbuilding sectors. However, the improved level of costs and the increased effectiveness of this organisation engender confidence for the future.

Developments in the organisation
Van Leeuwen Pipe and Tube Group has given further substance to its strategy of concentrating efforts on establishing or strengthening leading positions in those markets that are of interest to the Group. Co-operation with partners on international projects has progressed successfully. Further cost-saving initiatives and efficiency improvements have strengthened the competitive position. In order to bring about a structural improvement in the financial and operational performance the management model has been reformed into a divisional structure. Much attention has focused on internal controls, risk management, logistical improvements and the modernisation of facilities.

Prospects
The business priority for 2004 will be achieving further controlled growth. It is difficult to make forecasts in view of the uncertain circumstances. On balance sharply rising steel prices benefited Van Leeuwen Pipe and Tube Group in the first few months of the year, but it is not inconceivable that a reversal could take place during the second half of the year.

The Group remains positive about developments in Asia and the Middle East and expects to be able to increase its market share on many fronts, thanks to its stronger, more effective organisation. Van Leeuwen Pipe and Tube Group anticipates a positive result and probably a further increase in profit.

Van Leeuwen Pipe and Tube Group
Van Leeuwen Pipe and Tube Group is an international distributor of steel pipe, pipe components and valves. The Group is active in practically every sector of industry. The foundations for the business were laid in 1924. The Group currently has 27 establishments spread across Europe, Asia, the Middle East, Australia and Canada.


     Tel: +31 78 6252525   Fax: +31 78 6252020
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