SSAB has released its report for the third quarter of 2018.
The quarter results:
- Sales were SEK 19,038 (16,188) million
- Operating profit before depreciation/amortization and items affecting comparability was SEK 2,563 (2,016) million
- Operating profit, excluding items affecting comparability, was SEK 1,600 (1,089) million
- Operating profit, including items affecting comparability of SEK -213 million, was SEK 1,387 (1,089) million
- Earnings per share were SEK 0.85 (0.56)
- Operating cash flow was SEK 1,922 (1,590) million
- Net debt/equity ratio was 17% (27%)
Comments by the CEO
"SSAB’s operating profit, excluding items affecting comparability, for Q3 2018 was SEK 1,600 million, up SEK 511 million compared with the third quarter 2017. The improvement was mainly related to SSAB Americas and SSAB Special Steels. Operating profit was in line with the previous quarter. Q3 was characterized by good demand and favorable pricing in our markets.
"SSAB Special Steels saw strong demand in all segments and especially within Construction Machinery and Material Handling. Shipments during the third quarter were 320,000 tonnes, up 9% compared with a year earlier. Operating profit was SEK 536 million. The two-week unplanned blast furnace outage in Oxelösund impacted earnings negatively by just under SEK 100 million.
"Demand in Europe was seasonally lower compared with the previous quarter. Compared to last year, SSAB Europe's shipments were lower and operating profit decreased to SEK 460 million in the quarter. A lower production rate, partly due to the transformer fire in Hämeenlinna, reduced shipments and capacity utilization.
"SSAB Americas’ operating profit was a record high SEK 790 million, up SEK 474 million compared with the third quarter of 2017. This improvement was driven primarily by higher prices, but higher volumes and more stable production also contributed positively. Demand is showing a positive trend in most segments and the outlook for the fourth quarter is good.
"Earnings for the group have improved, even though we have had a number of larger production disruptions during the year. The main focus is on reaching a higher, more stable rate of production and a safer workplace. We are prioritizing our resources on preventive measures, both where we have experienced disruptions and in identified risk areas. On top of this we are stepping up our work on continuous improvement.
"Despite the political turbulence surrounding trade barriers, we expect the outlook to remain good for the fourth quarter of 2018. SSAB has strong positions in our home markets and we are on track towards achieving our strategic growth targets for 2020. Our sustainability target to achieve CO2 savings of 10 million tonnes annually together with our customers, will be achieved 5 years ahead of plan, in 2020 instead of 2025. New, longer-term objectives in this area will be evaluated. "