SSAB 1Q Sales SEK31.58B

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By Dominic Chopping

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STOCKHOLM–Swedish steelmaker SSAB AB on Tuesday posted a bigger-than-expected rise in first-quarter net profit, driven by higher steel prices.

The company said the war has driven up both raw material and steel prices and that order intake rose temporarily during the first quarter as customers wanted to ensure supply of steel. Demand for steel during the second quarter of 2022 is expected to normalize, it added.

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SSAB said all units posted strong results, more than offsetting the impact of an unplanned stop in a blast furnace in Raahe, Finland, production disruptions in SSAB Americas and higher raw-material costs.

The company said first-quarter net profit rose to 6.01 billion Swedish kronor ($618.9 million) from SEK1.51 billion a year earlier, as sales rose 61% to SEK31.58 billion.

Analysts polled by FactSet had expected net profit of SEK5.47 billion on sales of SEK28.23 billion.

“SSAB directly ceased sales to Russia and Belarus and discontinued new purchases of ore and coal from Russia until further notice,” said Chief Executive Martin Lindqvist.

“Several measures have been introduced to ensure access to raw materials, but there is a risk of disruptions related to sanctions and other fallout from the war in Ukraine.”

Write to Dominic Chopping at [email protected]

By Dominic Chopping

STOCKHOLM–Swedish steelmaker SSAB AB on Tuesday posted a bigger-than-expected rise in first-quarter net profit, driven by higher steel prices.

The company said the war in Ukraine has driven up both raw material and steel prices and that order intake rose temporarily during the first quarter as customers wanted to ensure supply of steel. Demand for steel during the second quarter of 2022 is expected to normalize, it added.

SSAB said all units posted strong results, more than offsetting the impact of an unplanned stop in a blast furnace in Raahe, Finland, production disruptions in SSAB Americas and higher raw-material costs.

The company said first-quarter net profit rose to 6.01 billion Swedish kronor ($618.9 million) from SEK1.51 billion a year earlier, as sales rose 61% to SEK31.58 billion.

Analysts polled by FactSet had expected net profit of SEK5.47 billion on sales of SEK28.23 billion.

“SSAB directly ceased sales to Russia and Belarus and discontinued new purchases of ore and coal from Russia until further notice,” Chief Executive Martin Lindqvist said.

“Several measures have been introduced to ensure access to raw materials, but there is a risk of disruptions related to sanctions and other fallout from the war in Ukraine.”

SSAB has minor operations in Ukraine through its Ruukki Construction unit, and the company said it is assisting employees and their families with transport and accommodation, to leave the war zones and go to Poland and other nearby countries.

Demand for steel during the second quarter of 2022 is expected to normalize and therefore be on a somewhat lower level than in the first quarter, while there remain uncertainties with a shortage of components as well as bottlenecks in logistics chains, it added.

Global demand for high-strength steel is expected to remain at a good level during the second quarter in most markets, the company said.

Shipments and prices are expected to be higher during the second quarter of 2022 compared with the first quarter in SSAB Special Steels while shipments and prices are seen somewhat higher at SSAB Europe. At SSAB Americas, shipments are expected to be higher with prices seen somewhat higher.

However, higher realized prices will be counteracted by higher input costs at all three steel divisions following a sharp rise in market prices of raw materials during the first quarter of 2022, it added.

Write to Dominic Chopping at [email protected]

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Credit: www.marketwatch.com /

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