Polish industrial firms show Q1 gains from cost cuts, steel sector sees price support

Polish industrial companies are navigating a challenging market, with first-quarter results revealing a mixed picture. While many firms reported improved profitability, this was primarily driven by cost-cutting measures rather than an increase in revenue, which continues to be hampered by weak demand.

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A significant portion of industrial companies had relatively weak results in 2025, so the comparative base in the first quarter was relatively low for them.

The steel sector, however, has seen some positive developments. Companies in this industry have benefited from rising steel prices, a trend supported by new EU regulations such as the Carbon Border Adjustment Mechanism (CBAM). This mechanism restricts the import of cheaper steel from outside the EU, indirectly boosting domestic prices. Analysts anticipate further price increases in the third quarter due to new safeguard measures on steel imports.

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Without a doubt, the results of steel companies are supported by the observed increases in steel prices since the beginning of the year. However, in the first quarter, this did not yet fully translate into reported results due to the cold winter in Poland, which limited demand for steel in the construction sector.

Despite these price increases, demand for steel remains moderate, with no significant investment boom evident. The construction and automotive industries are key consumers of steel, and their performance is crucial for sector growth. Analysts note that the current price surge is more a result of regulatory changes than robust market demand.

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From July 1, a new Safeguard on steel products will come into force, which will halve duty-free steel imports into the EU, which in our assessment may cause another wave of price increases in the third quarter despite the moderate demand situation.

Some companies, like appliance manufacturer Amica, have successfully improved their profit margins through operational optimization. Amica continues to focus on efficiency, aligning with its 2025-2027 strategy, even as the market for durable goods in Europe struggles. However, achieving targeted sales growth remains a persistent challenge across the industrial sector, underscoring the ongoing need for demand recovery.

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We are still not achieving the assumed sales growth. Demand plays a decisive role. In terms of working on improving profitability, we are moving in the direction set out in the strategy for 2025-2027.