In the first quarter of 2023, it is difficult to predict how the year will develop. Market developments are uncertain due to increasing inflation, high energy prices, the fear of a recession and the geopolitical situation. The tight labor market also plays a role in this. The price trends for pipe and tube materials are a key factor in the outlook for 2023. At the beginning of 2023, it seemed prices were starting to drop. However, by the end of the first quarter, prices stayed at 2022 levels due to high raw material and energy prices.
Sales volumes continue to be under pressure, although this differs by sales segment. However, among our customers the major uncertainly about market developments appears to be decreasing and optimism to be increasing. In the Mechanical Engineering and Process & Power segments in particular, market developments are good. The level of activity in the energy segment has increased. Our companies in North America, Asia and Australia are well positioned to respond to this and are expected to acquire a number of nice projects in this area. Van Leeuwen's order book was well-stocked in the first quarter.
We expect a further consolidation in the steel distribution sector. We are closely monitoring developments and, should interesting opportunities arise, we will invest in them. On the basis of our strong position as a globally operating leading distributor of pipes and tubes, we continue providing our customers in various market segments with customized services in 2023. By keeping our stocks up to par throughout the world and by investing further in our international network, we are able to stay ahead of potential shortages and disruptions in the supply chain. Furthermore, we continue to advance our logistics innovation program and to invest in logistics and storage systems, machines and automation. This way, together with our people, we aim to realize our promise "more than tubes" in the coming year as well.
International cooperation and innovative entrepreneurship are characteristic of our culture. On this basis we will continue to build our company in 2023, together with our suppliers and for our customers. As a family business with a history dating back almost one hundred years we know how important our people are – ranging from experienced employees who have devoted their efforts on behalf of the company for tens of years and trainees who help our company progress with new insights.
Zwijndrecht, the Netherlands, 28 March 2023
