What was the year 2024 like?

It is mid-February, which means it is an opportunity to recap the past year 2024. However, it must be said that data collection is not easy at all. Our commercial register is also a repository of basic company documents, but it is very difficult to obtain numbers for smaller heat treaters, where the obligation to store only limited data is imposed. And you will not learn anything about the current year here, most companies only fulfil their obligations at the end of the following year. Why is that? Even though the obligation exists, there is no penalty.

Here, Slovakia clearly trumped us, whose Finstat is a completely brilliant presentation of companies without the need to search for data https://www.finstat.sk/. See an example of a statement for AKB Martin.

And when it comes to in-house hardening plants, it’s just black magic. I estimate these numbers only based on knowledge of the production program, the structure of the equipment in the hardening plant and market indications. And the accuracy of my estimate? I admit +/-50%. It is similar with companies like Voestalpine or International Metal Service, formerly Swiss Steel, where heat treatment is hidden in the numbers for steel sales.

In 2024, I keep records of 156 hardening plants or heat treatment operations. This list also includes commercial coating plants (HVM Plasma, LISS, IonBond, etc.), or companies providing laser heat treatment services.

I keep records of 30 of the purely custom/commercial ones. The largest provider is of course Bodycote HT. Its operations in Prague, Liberec, Brno and Krnov have a combined turnover of over 400 million CZK. Of the individual hardening plants, the largest is Bodycote Slovakia, i.e. the operation in Vlkanová with a turnover of over 200 million. CZK.

If I add up the entire commercial processing market in 2024, it gives me a figure of 1.6 billion CZK. Bodycote therefore owns more than 36% of the market. Of the individual heat treatment companies, I see the greatest progress at Galvamet, which, after the acquisition of Narex Metallurgy in Prague, is already approaching the standard size of Bodycote plants.

But the profitability of individual subjects is also interesting. I remember the times when it was not a problem to overcome the 30% profit. As late as 2013, Bodycote’s net cash flow was around 80 million CZK, of which depreciation was 20 million CZK. Today it is clear that time has brought a certain levelling of profitability to a level of around 12%. Given the underinvestment of heat treaters in the past, this will also correspond to free cash for further investments. The following graph shows the average profitability values for the TOP12 in the columns, the red curve is for Bodycote HT.

In terms of changes in the market, the biggest change is probably the sale of Swiss Steel to the JACQUET METALS group in October 2023, followed by the acquisition of Galvamet by Prague-based Narex Metallurgy.

In terms of investments, Galvamet seems to me to be the most active, increasingly expanding vacuum for aerospace and with Nadcap certification. Right behind it is the Meduna Vacuum Hardening Plant, where the benefit of Viktor Novák’s economic education and experience can be seen, hand in hand with the technical heritage of the hardening plant after Mirek Meduna. However, the largest investment in heat treatment is going outside the commercial heat treatment, to PBS Velká Bíteš. However, because I have a signed NDA, I will not give any details, but I am really looking forward to it, it is a big leap into the future for the entire Czech Republic.

And what to expect in 2025? I think it will not be a boring year. There will be winners, and there will be losers. The meaningless EU energy policy will be deadly for some, for others it is an opportunity for innovation. This will be a great opportunity for change.

Jiří Stanislav

February 16, 2025