Steelmaker SSAB flags improving shipments in more stable market
Reuters
Published Jan 27, 2023 01:58AM ET
Updated Jan 27, 2023 02:50AM ET
By Niklas Pollard
STOCKHOLM (Reuters) -Swedish steelmaker SSAB expects to increase shipments in a more stable market in the first quarter, it said on Friday as it reported earnings in line with market expectations.
Steelmakers benefited from brisk demand through much of last year but in the second half encountered a significant slowdown in Europe, the region hardest hit by the energy crisis stemming from the war in Ukraine.
Fourth-quarter operating profit at SSAB, which operates steel businesses on both sides of the Atlantic, was 3.77 billion crowns ($366 million) down from 6.96 billion crowns a year earlier but only just behind analyst expectations, Refinitiv data shows.
Soaring energy costs, rampant inflation and industrial supply chain problems remain worries, but SSAB said it had adjusted production in the face of a cautious European steel market and brought forward maintenance in the quarter.
"The assessment is that the market has stabilised, although there is continued uncertainty," it said.
The company forecast that first-quarter shipments by its European and Special Steels divisions would be "significantly higher" than the previous quarter.
However, its prices were forecast to be lower for all three businesses in the current quarter while overall raw material costs were expected to be stable.
SSAB also said it was making an impairment charge of 33.3 billion crowns related to higher interest rates, adding that this would not affect cash flow or dividend policy.
The company proposed to raise its dividend to 8.70 crowns per share from 5.25 crowns and is seeking authorisation for share buybacks.
($1 = 10.2957 Swedish crowns)
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Written By: Reuters
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