As for 2012-2013, in the plant making sector we expect results to be in line with this year's, while the steel making sector is likely to see a decline because of a weak European steel market.
We in fact believe that over the next few months global steel consumption will remain stable or increase by a few points, whereas in Europe -especially in the coming six to twelve months- we could see an average drop of 10-15%.

To support the strategies and vision that our company is pursuing, the following investments are in progress:

> Expansion of the Buttrio Research Centre;
> Investments of 40 million euro (nearly completed) in our Buttrio workshops, which are and will be a center of excellence for the manufacture of noble equipment;
> In 2012-13 we will complete the expansion of our engineering departments and workshops in China, which will be double what they are now, and build a 60 million euro factory in India and a service facility in Russia.

We have also taken over some specialized high-tech companies:

> Akros Henschel in Germany, for eco-friendly ferrous scrap processing;
> Ing. Candotti Impianti Industriali, an engineering company for tailor-made lifting equipment for ports and other special applications;
> Olivotto Ferrè, specialized in the design of heat treatment furnaces and systems.

And, on the subject of acquisitions, we are more than pleased to inform you that our recent acquisition of Innoval in the U.K. (aluminum production processes and technologies) has played a significant role in enabling us to consistently get orders for hot and cold aluminum rolling mills, a sector in which we were previously limited to extrusion presses. Orders have come in from Austria, Russia and China.
In addition, our innovative MI.DA. plants (endless casting rolling for long products) and high-productivity, high-speed, high-quality (H3) thin slab casters continue to perform extremely well on the market and consequently they account for a large part of our order book. In the meantime, we are concentrating on completing the industrialization of our new ideas as per our last research and development plan. All this as far as the plant making segment is concerned. While in steel making (ABS) we have decided to go ahead with the revamping of the existing blooming mill and launched a number of activities targeting the production of higher added value special steel grades. With a view to making our steel making sector even more competitive, we have also acquired the Sisak steel mill in Croatia to produce special semi-finished products in quality steel grades, and will be upgrading the existing equipment accordingly. Finally we need to bear in mind that the next two to three years will most probably be challenging due to the global economic slowdown, which will consequently bring about a reshaping of the steel making sector, particularly in Europe. However, rest assured that Danieli is in a position to meet future challenges, not only on the strength of its solid finances, but mainly because of a strong, international and motivated team whose education and attitude represent one of the best international practices in the field. To this we can also add our team’s professionalism and extensive experience in innovating, engineering, and manufacturing equipment and plants for the metal industry, in turnkey projects as well.
The Danieli team -Innoval, DDD (UK), Wean United (USA), Sund Birsta and Morgårdshammar (Sweden), Fröhling, W+K, Akros Henschel (Germany), Rotelec (France), Danieli Corus Technical Services (the Netherlands), Danieli China, Danieli India and Danieli Thailand- is a successful and unique example of a knowledgeable team that is equally competitive in technology, costing and customer service.

The Board thanks the Danieli Group team for their enthusiasm, dedication and pride in their work. Their energy and positive attitude are key to maintaining our success, constant progress and expansion. These attributes cannot be bought or learned, but have been built into the company’s character since the beginning, and have come to be our most valuable intangible asset.
We also thank our customers, whose innovative spirit makes them true partners in our quest to beat records and do things better in order to remain front runners.
Finally, we wish to thank our shareholders, who as per tradition allow us to reinvest more than 85% of our profit back into the company.
Not only do this approach and vision stand for trust, but also for motivation and pride in sharing with the Danieli team the satisfaction of continuing to do better and forging a successful future together.

Gianpietro Benedetti
Chairman and CEO