Report for the first quarter of 2015
The quarter · Sales were SEK 15,468 (9,521) million · Operating profit, excluding items affecting comparability, was SEK 564 (26) million · The profit/loss after financial items, excluding items affecting comparability, was SEK 350 (-135) million · Earnings per share SEK 0.52 (-0.15) · Items affecting comparability affected the profit/loss after tax by SEK -31 (-) million and earnings per share by SEK ‑0.06 (-) · Operating cash flow was SEK 784 (-275) million · The Rautaruukki transaction has been completed, through both the completion of the divestment of the assets which was a condition for the combination, and the redemption of the shares held by minority shareholders
Comments by the CEO
SSAB’s operating profit for the first quarter of 2015 was SEK 564 million (excluding items affecting comparability), up SEK 446 million compared with the fourth quarter of 2014 and up SEK 530 million (pro forma) compared with the first quarter last year. This improvement was primarily driven by lower costs of raw materials, the synergies achieved from the acquisition of Rautaruukki and positive currency effects. SSAB Europe showed the strongest improvement in performance. Operating cash flow for the first quarter was SEK 784 million, despite the build-up of steel slabs ahead of the relining of the blast furnace in Luleå in summer this year.
In the Nordic region and the rest of western Europe, demand for standard steel normalized compared with the decrease in demand seen towards the end of 2014. Demand for our special steels remained stable, albeit at a low level and with major geographical variations. In North America, the steel market was relatively weak during the first quarter. This was driven by high inventory levels at distributors and continued high volumes of imports from Asia and Europe. Overall, this put pressure on prices in the North American market. The costs of raw materials, primarily iron ore for the Swedish and Finnish mills, continued to fall during the quarter.
Apparent use of steel is expected to increase both in Europe and in North America during 2015. Despite weak deliveries to distributors in North America during the first quarter, underlying demand remains good. However, destocking in North America has lasted longer than expected, and demand is not expected to pick up until the end of the second quarter
We are now in a period where we are implementing actions included in the plan to integrate Rautaruukki. Re-negotiated purchase agreements is one of the measures we have taken that are already reflected in the result. During the first quarter, we achieved synergies of around SEK 100 million and at the end of the quarter, annual sustainable savings amounted to approximately SEK 450 million.
During the spring, SSAB is undertaking one of its largest marketing efforts ever with the launch of the new brand Strenx, which consists of SSAB’s top products within structural steel which were earlier sold under the Optim, Weldox and Domex brands. GreenCoat, a new brand for SSAB’s colour-coated products, was launched in the beginning of April. These launches are two major steps toward a common product portfolio within SSAB.
This information is such that SSAB must disclose in accordance with the Securities Markets Act. The information was submitted for publication on April 27, 2015 at 07.30 am.
Invitation to SSAB’s first quarter 2015 results briefing
SSAB invites you to a presentation of the quarterly report at 09.30am CEST on Monday April 27, 2015.
The interim report for the first quarter of 2015 will be presented by SSAB’s President and CEO Martin Lindqvist, and CFO Håkan Folin.
The press conference will be held in English and live webcast on SSAB’s website www.ssab.com. It is also possible to participate in the briefing via telephone.
Venue and time of briefing: World Trade Center (WTC) Stockholm, Kungsbron 1, Conference room Manhattan, 09.30am CEST.
+46 8 5055 64 74 (Sweden),
+44 203 364 53 74 (UK),
+1 855 753 22 30 (USA).
Link to webcast: Go to webcast
Instructions on how to participate in the webcast will be available on SSAB’s website, including presentation material for downloading.
For further information:
Andreas Koch, Director IR and Financial Communications, Tel. +46 70 509 77 61
Marie Elfstrand, Director Media Relations and PR, Tel. +46 8 45 45 734
SSAB is a Nordic and US-based steel company. SSAB offers value added products and services developed in close cooperation with its customers to create a stronger, lighter and more sustainable world. SSAB has employees in over 50 countries. SSAB has production facilities in Sweden, Finland and the US. SSAB is listed on the NASDAQ OMX Nordic Exchange in Stockholm and has a secondary listing on the NASDAQ OMX in Helsinki. www.ssab.com.