A market with growth and medium-term outlook that remains favourable

The manganese ore market is heavily influenced by worldwide trends in steelmaking, which represents 90% of outlets for the metal. World production of carbon steel, edged up in the year by approximately 0.8% from 2015 level helped by a loosening of credit in China, which in turn led to a resumption of major construction programs and a lowering of steel stocks at producers. China alone accounted for 50% of global carbon steel production in 2016. In this context, the ERAMET Group, one of the leading high-grade manganese producers, operates one of the most competitive deposits in the world, Moanda in Gabon.

Turnover by Market in 2016

Turnover by Market in 2016

Steelmaking was ERAMET Manganese’s main outlet in 2016.

 

Turnover (€ millions)

Turnover (€ millions)

ERAMET Manganese’s turnover was stable compared with 2015.

 

Current Operating income (€ millions)

Current Operating income (€ millions)

ERAMET Manganese current operating income shot up to €219 million, boosted by the competitiveness of the Moanda deposit and the Group's manganese alloys plants, as well as the robust rise in the manganese ore prices in the second half of 2016.

 

Capital expenditure (€ millions)

Capital expenditure (€ millions)

The decrease in capital expenditure results from the completion of programmes at Moanda Metallurgical Complex (CMM) in Gabon and Grande Côte in Senegal, and from strict management of the Division’s other programmes.

 

Mining Production (€ millions)

Mining Production (€ millions)

Against a depressed price background, ERAMET Manganese halted production for one month in the first quarter of 2016. With this adjustment, annual production was 3.4 million tonnes transported in 2016.

 

Cost reduction and operating performance improvement plans

The cost reduction and productivity improvement plans implemented by ERAMET Manganese delivered a cumulative annual impact of €81 million on current operating income since 2014, relative to 2013. These gains were amplified by additional plans implemented in COMILOG and ERAMET Norway during 2016.

 

Asset disposals program

ERAMET disposed ERACHEM (manganese chemicals), Somivab (forestry operation in Gabon) and Bear Metallurgical Company (vanadium and molybdenum metallurgy in the USA). The impact of the disposals on the Group's net debt comes out at €142 million.

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