On May 7th, Thamesteel limited (TSL) invited a group of counterparties for a "meet & greet" day at their Steel Plant located in Sheerness, Kent. This event was attended by over 40 counterparties, including Thamesteel’s customers, suppliers, insurers, bankers and solicitors.
The primary objective of this event was to communicate the Company’s efforts to deal with the challenging economic and market conditions, as well as to share its future plans. The Company also wanted to show its appreciation to its counterparties for their cooperation during these challenging times.
Over 40 guests attended, hearing presentations from Thamesteel's General Manager of Sales & Marketing, Keith Plowman, and Financial Controller, Martin Garratt, as well from four significant downstream group companies. The guests were then taken on a tour of the melting shop and rolling mill led by Health & Safety Manager Roger Marsh.
Martin Garratt's presentation focussed on the Company's challenges during the tough economic and market conditions, as well as how the Company is addressing those challenges.
"We resolved the situation by both reducing production down to 35% of capacity, and by working with our partner companies to both liquidate stock and reschedule vendor payments," says Martin Garratt. "We now have reasonable working capital lines in place, have accelerated payments, and can approach the future with a great deal of optimism - hence today, which we saw as a very good opportunity to thank our partner companies."
Garratt also explained that the three key risks faced by Thamesteel's counterparties are credit, performance and market risks.
"For market risk," said Garratt. "Thamesteel is well positioned to take advantage of the major infrastructure projects in the pipeline, including Crossrail, Thameslink, the M1 and M25 widening projects, BAA airport expansions and, of course, the Olympics. And that's just in the UK."
"We have weathered the worst of the storm," concluded Garratt, "and have confidence in our business model over the medium-long term. We are well capitalised with strong group support and enough cash for the short term future. And we are predicting an upswing in demand in late 2009."
Another positive for Thamesteel was outlined by further presentations by downstream offtakers in The Netherlands (ATG Netherlands), Germany (ATG Deutschland) and the UK (Kierbeck). Thamesteel, like its major offtakers, are all part of the Al-Tuwairqi Group (ATG) of Saudi Arabia. The participants were informed that the Company has an in-house consumption of 280,000 tpa of rebar and rod wires, with further opportunities to sell regular volumes to other group companies in the Middle East and Asia.
"We have an enormous appetite for Thamesteel's products," said Kris van Ginderdeuren, Commercial Director of reinforcement mesh giant Van Merksteijn, Netherlands-based partner offtaker of Thamesteel. "We have been working with Thamesteel closely and our order book for them is growing. We think the partnership approach is crucial to our success in the UK."
Suppliers and buyers certainly appreciated Thamesteel's partner-driven approach, as well as the Company's hospitality for the day.
"These are tough times but we will survive if we work together," said guest Alexander Krug, Technical Sales Director at SGL Carbon GmbH, a Germany-based supplier to Thamesteel. "That's why I think the idea of today was excellent."
"It was a very interesting and very well organized day," said guest Wilhelm Alff, Sales Director, Stemcor Europe AG. "We took a lot of valuable information with us and look forward to fruitful long-lasting business in the near future with Thamesteel and the ATG group of companies."
The day ended with a light lunch.
