Relevant GRI Indicators
Strategy and technology
Strategic focus areas
Our long-term focus is to continue being a leading materials technology innovator, providing customers with solutions that help make them safer, more energy efficient and productive. Last year we stated a short-term goal to reach a 10 percent EBIT (Earnings Before Interest and Tax) margin through portfolio optimization, improving our footprint within the Tube division, price-mix optimization and strengthen our culture of commitment and execution. By the end of 2019, we had achieved this short-term goal.
Focus on core
In 2019 we continued our focus on more advanced products, such as nickel-based and super alloys. One addition to our portfolio is Sanicro® 35, a new austenitic stainless steel grade that combines extreme pitting corrosion resistance and mechanical properties in a single alloy. This pioneering innovation was awarded with the internal Sandvik Innovation prize in 2019. We strengthened our position in tubular products and will continue to focus on super alloys and high nickel alloys. We are also expanding the heating solution service offering and strengthening our position within heating systems as the market transforms from gas to electric solutions.
Technology leadership and innovation
Sandvik Materials Technology is recognized for its pioneering efforts in research and development and we continued to capture new ground. During 2019, a first commercial order was secured for Sentusys™, an intelligent tube system used for in-process, online monitoring, providing continuous information about temperature, strain and vibration. The medical segment with our Exera® range of precision fine wires and wire-based components are used in a wide range of medical applications, from the treatment of cardiovascular disorders to solutions for glucose monitoring, deep brain stimulation and hearing implants. We are also increasing our digital services and our new online shop for the Tube division is an industry first. It provides customers with a personalized dashboard overview of, among other things, stock levels, prices, orders and documentation.
With our highly innovative product offering we are in an excellent position to match market requirements for materials that are strong yet light, durable, recyclable and have anti-corrosive properties. We recently patented a hyper duplex strip steel that matches all of these requirements. Sandvik Materials Technology frequently collaborates with partners and customers to bring solutions to the market that capture material science opportunities within many different segments.
Tubular products, bars, billets, strip, rock drill steel, heating systems, precision medical wire and metal powder.
Selected niches in demanding industries where material requirements, as well as product quality and reliability, are extremely high. High entry barriers.
- Energy demand
- Industrial production
- Environmental demands and legislation, for example, reduced emissions and energy consumption
- Materials evolution i.e. advanced material requirements
- Increased demand for safety, reliability and more sustainable materials
Competitive landscape/ Major competitors
Nippon Steel and Sumitomo Metal (tube), Tubacex (tube), Jiuli (tube)
VoestAlpine (strip), Aperam (heating elements and systems), smaller niche players.
About 80 percent direct sales.
Increased focus on products and solutions improving energy efficiency and reducing emissions. Continued material evolution through focused R&D efforts and technologies based on, for example, powder metallurgy.
Strategic risk management
Fluctuating oil and gas prices. Increased competition of high-tech material from China. Local protectionism in the steel industry.