If you're a metal producer or a construction company, Harsco is at your service. Its metals and minerals segment provides mill services at steel factories and offers metal reclamation, slag processing, scrap management, and other services for steel and nonferrous metals producers. This segment's units act as an on-site service partner in more than 50 countries. Harsco's Infrastructure segment specializes in services that include concrete forming and access-related construction, renting and selling scaffolding, and site safety. It also provides industrial services such as plant shutdowns, upgrades, and maintenance. Other Harsco units make railway track, steel grating, and heat exchangers.
Harsco is diversified not only in its mix of businesses, but also geographically. It operates at some 450 locations in 50 countries. Giant steel company ArcelorMittal is one of the company's largest customers, accounting for about 10% of its total sales each year for the past three years.
To counteract the challenges of the global economy, Harsco has been taking measures such as reducing costs and implementing improvement programs in 2010 and 2011. In late 2011 it began a transformation of its Industrial and Metals and Minerals segments. It is streamlining its European operations, exiting underperforming locations, and paying down debt. The company continues to expand globally through joint ventures. It also will continue to evaluate acquisitions in targeted growth markets, particularly in emerging economies. It seeks organic growth through diversifying, streamlining, and consolidating its operations.
Despite a global economic recession and uncertainties in nonresidential construction markets in the UK and some Western European countries, the company generated revenue of $3.3 billion in 2011, about 9% higher than that of 2010. The revenue hike resulted from favorable currency exchanges and an increase in global steel production in its Metals & Minerals segment, higher demand in the Industrial segment, and an increased sales volume of erection and dismantling services in the Infrastructure segment.
The higher sales were offset in part by an underperforming Rail segment, which was affected by the timing and mix of equipment shipments that year. Harsco reported a net loss of $11.5 million for the year, due to restructuring and pension costs and a rather large income tax expense.
In 2012 the company built on its presence in international markets to win $20 million in contracts to provide railroad maintenance equipment to companies in China, South Korea, and the UK. The company will provide grinder vehicles to smooth rail surfaces for a new rapid transit system being built by the Ningbo Rail Transit Group in China. It also will sell maintenance equipment to Sampyo Engineering and Construction, a South Korean bridge and railway construction company that is building a high-speed train line for Korea Train Express. The orders also include a rail grinder sale for the UK rail network, where Harsco has operated for a decade.
Also in 2012, the company signed a 20-year services contract with Hebei Iron & Steel (HBIS) Group, China's largest steelmaker, valued at more than $375 million. Harsco will provide handling and processing of that company's Tangshan Iron & Steel flagship site.
As another part of its strategy to expand its presence in key international markets, Harsco formed a joint venture in 2011 with Brazil-based Armco Staco S.A. Indústria Metalurgica to produce and market industrial grating products for infrastructure and commercial development sectors throughout South America. The venture leverages Armco Staco's manufacturing facilities with Harsco's experience with state-of-the-art grating products. Grating is used for such construction applications as open-grid flooring, safety walkways, and work platforms, as well as for a broad range of commercial applications. – less
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