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In this article, the CEO of RHI Magnesita, Stefan Borgas, sums up the calendar year and shares his New Year resolutions. Here’s how a business leader analyses the current situation and approaches setting goals for the future.
What were the major events of 2022, which affected the market and your company’s strategy the most?
The situation in Ukraine and its consequences have been a major unexpected challenge, especially for our European customers and our own European plants. As early as in March 2022, in our 8 European plants, we replaced 50% of the energy needs with alternative fuels; the investment was over EUR 8 million.
Even beyond Europe, the conflict has further weakened the fragile economic post-pandemic recovery, and increased energy cost in many regions.
In the Americas, we have moved closer to our customers by building-up significant inventories, thus improving our delivery performance. In Brazil, we have invested in plants to enhance our cost position and boost product quality. In India, we have followed the market growth and established RHI Magnesita India as a responsible market leader. In addition, our business in China supports the country in overcoming COVID-19.
We must soberly admit that the disruptive environment has become today’s and tomorrow’s reality. Our answers to volatility are customer proximity, flexibility, and speed. Evidently, more adaptations triggered by thus far unknown geopolitical changes will become necessary in the next years. With the excellent and growing RHI Magnesita team – I am proud to say – we are again and again implementing smart solutions to all the emerging challenges.
What were the main achievements of RHI Magnesita in 2022?
Despite the turbulence, our great team achieved a lot – here are a few highlights:
We will take these good results as a fuel to boost ourselves, because there is always a room to do more; and to improve, while listening to our customers.
How do you see the company grow in 2023 and beyond?
This year, we marked the 5th anniversary of RHI Magnesita. I’m extremely proud about our company: we secured the role of a responsible market leader. Our corporate culture of global collaboration, innovation, accountability, and responsibility, as well as an open, friendly and direct communication for the benefit of our customers, continue to be embraced by all our 15.000 employees.
Our customers are our top priority – and we deliver! RHI Magnesita’s worldwide investments in additional inventories since the end of 2021 account for, approximately, EUR 700 million. We ensure that our clients remain supplied with high performing, essential refractories, and thus can overcame the extreme supply chain volatility.
Furthermore, since 2020, we have invested more than EUR 300 million additional funds into our production network in the USA, Europe, China, India, and Brazil, to improve efficiency and product quality, strengthen regional supply capabilities, and increase flexibility. This massive capital commitment to build a sustainable refractory service business is wholeheartedly supported by our owners.
Another integral part of our culture is the health and safety of our people. Our target is nothing else than zero accidents, and we have developed strong programs to pursue it.
Financially we are on track to achieve all our targets for 2022. And now, we are preparing for a slightly gloomier economic environment in 2023.
How do you hope to impact the industry in the long run?
I would really like to highlight our sustainability efforts. We are truly passionate about progress in this area. In 2022, we have further increased the use of secondary raw materials. In June, RHI Magnesita already exceeded its 2025 target and recorded a recycling rate of more than 10%.
We are now investing EUR 50 million into discovering new technologies: we must, and we will, eliminate all our CO2 emissions eventually. We are a true sustainability frontrunner in the refractories world and beyond.
What are your professional and personal New Year resolutions?
What is the best lesson you have learned in 2022?
“People overcome difficult situations together.
People make a difference.”
On this note, I would like to thank all our employees, partners, investors, customers, suppliers, and just supporters: you make me proud and happy! The success of RHI Magnesita is possible because of your endless passion and engagement. We have overcome so many setbacks and achieved so many goals together. Thank you again for being such a great community.
On behalf of the RHI Magnesita Executive Management Team and our Board of Directors, I wish everyone a wonderful and peaceful year-end and energy refuelling. Happy holidays!