Lucchini Group’s consolidated profits

The shareholders’ meeting of Lucchini S.p.A. approved the 2007 financial statements as well as the Group’s consolidated accounts.

Lucchini Group’s consolidated accounts for financial year 2007, prepared in compliance with the national accounting standards, showed net profits of € 149.9 mln (€ 102.3 mln in 2006) .

The Group’s revenues totalled € 2,746.0 mln, reflecting a € 97.2 mln increase compared to 2006. This results is affected by a different basis of consolidation as compared to the previous year, due to the disposal of a number of companies during 2006 (Lucchini Sidermeccanica SpA, Nitruvid SaS and Ascoforge Safe SAS).

Consolidated EBITDA showed an increase of € 15.7 mln compared to 2006, standing at € 314.5 mln.

In financial year 2007, net financial costs came in at € 27.7 mln, compared to € 29.5 mln in the previous year, with the decrease being related to a lower financial exposure.

With regard to Lucchini S.p.A., the 2007 financial statements showed net profits of € 46.1 mln. Total sales stood at € 1,368.8 mln in 2007 (€ 1,255.6 mln in 2006), while EBITDA reached € 136.3 mln (€ 113.1 mln in 2006), corresponding to 10% of total sales.

While company performance in the first half benefited from an increase in the domestic and foreign steel market in terms of both volumes and prices, in the second half it was impacted by the slowdown in consumption and an increased competitiveness of non-EU manufacturers spurred by a weaker US dollar.

Steel production at Piombino site was 2.1 mln tn, while production at Trieste site was 400,000 tn of liquid cast iron.

Ascometal SA’s financial year ended with net profits of € 69.4 ln (€ 51.7 mln in 2006). Total sales exceeded € 1 billion, reflecting an increase of more than 10% compared to 2006. EBITDA reached € 144.3 mln, as opposed to € 120.9 mln in 2006, as the company benefited from a positive sale price/purchase price differential as well as significant efficiency gains.

The Group’s headcount totalled 6,992. Investments in production and environmental enhancements, as well as security at the workplace as a whole exceeded € 131 mln.

With regard to R&D, projects continued to be developed in respect of the launch of new finished products, thereby focusing on the improvement of the sale qualitative mix.

Consistent with policy of focusing on high quality long products, financial year 2006 highlights include the disposal of equity interest held by Lucchini SpA in Lucchini Sidermeccanica Spa (in June) and, as to Ascometal SA, the disposal of equity interest held in Nitruvid SAS (in July) and Ascoforge Safe SAS (end of October).

The Lucchini Group, which is a part of Severstal, comprises 10 businesses and service centers in Italy and France and is one of Europe’s biggest producers of bar sections from high-grade special steel. The Group has two specialized metallurgical plants: Piombino and Ascometal.

Italy’s second biggest steelmaking company in output, Lucchini produces hot-rolled sections and metal products for railways, castings, forgings, instrument steel, bright steel, and also billets, slabs, ingots and conversion pig iron for foundry. Among Lucchini’s clients are more than 1000 companies in Italy, France and Germany, including RFI, Riva, Peugeot, Setforge, Thyssen Krupp, etc.