SSAB has released its first quarter 2019 results.
The first quarter
- Sales were SEK 20,017 (17,388) million
- Operating profit before depreciation/amortization was SEK 2,755 (1,836) million
- Operating profit was SEK 1,674 (916) million
- Earnings per share were SEK 1.24 (0.65)
- Operating cash flow was SEK 1,139 (761) million
- Net debt/equity ratio was 16% (21%)
Comments by the CEO
SSAB’s operating profit for the first quarter of 2019 was SEK 1,674 million, up SEK 758 million compared with the first quarter of 2018, attributable to SSAB Americas and SSAB Special Steels. Operating profit was also up compared to the fourth quarter of 2018, when there were several planned maintenance outages.
SSAB Americas’ operating profit rose to SEK 956 (129) million for the first quarter. This improvement was driven primarily by significantly higher realized prices compared with the first quarter of 2018. Demand remained strong in most segments.
SSAB Special Steels saw continued strong demand in most segments. Operating profit was SEK 678 (434) million, up SEK 244 million compared with the first quarter of 2018. A more stable production contributed to the improvement in earnings.
Demand in Europe was fairly stable during the first quarter, although raw material prices increased. SSAB Europe carried out repairs and maintenance on one of the blast furnaces in Raahe during the quarter and this, together with some pressure on margins, pushed the operating profit down to SEK 347 (657) million.
All in all, 2019 has started on a positive note, with both SSAB Special Steels and SSAB Americas reporting record results. A further strengthening of our balance sheet creates a sound basis on which to continue to develop the company through strategic investments and bolt-on acquisitions. Even if growth in our high-strength steels leveled off somewhat during the quarter, we remain positive about the structural growth potential for these products. We continue to address production stability and are stepping up measures to create a safer workplace.
We see activity continuing at a good level, especially in Q&T steels and in heavy plate in the USA, whereas somewhat weaker leading economic indicators and a weakening in the automotive industry are contributing to some uncertainty regarding steel demand going forward. This means, all in all, that we expect the outlook for the second quarter of 2019 to be relatively good for the group as a whole.