in accordance with Section 125 (1) Austrian Stock Exchange Act 2018 (Börsegesetz 2018 - BörseG 2018)
INTERIM MANAGEMENT REPORT
This report is a translation of the original report in German, which is solely valid.
ECONOMIC ENVIRONMENT AND COURSE OF BUSINESS
While strong catch-up effects associated with the recovery from the COVID-19 pandemic still predominated at the start of the first half of the business year 2021/22, the macroeconomic climate stabilized at a high level over the remainder of the reporting period. Despite good economic growth that continued unabated, the regional differences in vaccination rates as well as the appearance during the Northern summer of ever new variants and mutations of the novel coronavirus triggered yet more uncertainty. Supply chain distortions, which continue to impact particularly the European automotive industry, have delayed deliveries of new cars. To top it off, energy prices rose worldwide toward the end of the business year's first half.
Two sectors, in particular-personal consumption and the service industry-benefited from the easing of COVID-19 restrictions in numerous European Union member states at the start of the current business year. The momentum in industrial sectors continued unabated although the shortages of pre-material, especially of semiconductors for electronic components, substantially undermined the performance of the automotive indus- try. The anticipated improvement in conditions during the Northern summer failed to materialize, with the result that conditions toward the end of the reporting period were as critical as before. Hence the European automotive industry was
unable to fully satisfy the strong demand for automobiles.
In this environment, the voestalpine Group succeeded in continuing the upward trajectory that had already begun in the previous business year. Moreover, orders from the aerospace industry started to come in again for the first time since the outbreak of the COVID-19 pandemic. The automotive industry was the only one whose performance remained subdued on account of the component supply chain difficulties.
In North America, the strong upturn at the end of the previous business year continued unabated in the first half of the business year 2021/22. But the strong momentum at the start of the business year began to wane over the Northern summer. The appearance of new variants of the novel coronavirus dampened economic activity in some areas of the service sector. On the whole, however, developments in manufacturing, personal consumption, and the labor market re mained positive. In contrast to the European Central Bank (ECB), the Federal Reserve (Fed) has indicated in the light of rising inflation that it will slow down ("taper") its expansive monetary policy ("quantitative easing") and begin to raise interest rates.
The voestalpine Group benefited in many areas from the positive market momentum in North America. This was helped along by the fact that, up to the end of the business year's second quar- ter, voestalpine's North American facilities were affected to a significantly lesser degree by the
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