Year-end report 2019: Lower earnings for SSAB Europe and SSAB Americas in the quarter, good cash conversion
The fourth quarter · Sales were SEK 16,973 (19,251) million · Operating profit/loss before depreciation/amortization excluding items affecting comparability was SEK -127 (1,971) million · Operating profit/loss, excluding items affecting comparability, was SEK -1,131 (1,035) million · Operating profit/loss, including items affecting comparability, was SEK -1,178 (1,007) million · Earnings per share were SEK -1.21 (0.67) · The Board proposes a dividend of SEK 1.50 (1.50) per share
Comments by the CEO
SSAB’s operating result for the fourth quarter of 2019 was SEK -1,131 million, down SEK 2,166 million compared with the fourth quarter of 2018. Lower earnings in the quarter were primarily attributable to SSAB Europe and SSAB Americas. Operating profit for the full year 2019 was SEK 2,159 (5,181) million, the decrease was mainly attributable to SSAB Europe.
SSAB Special Steels’ shipments were at a low level during the quarter, primarily attributable to weaker business cycle and stock adjustments on the European market. Planned maintenance costs impacted the operating result, which was SEK -126 (-72) million.
SSAB Europe’s shipments decreased to 752 (850) thousand tonnes, mostly driven by destocking both by end customers and distributors. The squeeze on margins continued and the costs of strike actions in Finland, around SEK 250 million, impacted fourth quarter earnings, which were SEK -609 (733) million.
The fourth quarter operating result for SSAB Americas decreased to SEK -222 (553) million largely due to lower realized prices and somewhat higher costs for planned maintenance. Demand was relatively stable, although shipments were affected by the planned maintenance outage in Mobile.
During the fourth quarter, cost savings had a positive result impact and production at our European steel mills was adjusted to lower demand and among other things, one blast furnace was idled in Raahe, Finland. This resulted in lower working capital and operating cash flow was SEK 1,321 (1,960) million for the quarter. Stock adjustments by customers on the European market are assessed to be over and our order intake improved towards the end of the quarter. This is expected to lead to increased shipments during the first quarter of 2020 and the blast furnace in Raahe has been back in operation since the start of the year.
Our strong balance sheet enabled us to complete a number of bolt-on acquisitions during the year. During the quarter, we launched new strategic targets that show our ambitions to grow in special products and to develop our own channels to market. The aim is to build an even stronger SSAB with less sensitivity to swings in the business cycle. The board proposes a dividend of SEK 1.50 per share.
Invitation to SSAB’s year-end report 2019 results briefing
SSAB invites you to a presentation of the year-end 2019 report today at 9.30am CET. 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 CET.
+46 856 642 651 (Sweden),
+44 333 300 0804 (UK),
+1 631 913 1422 (USA).
Link to webcast: Go to webcast
For further information, please contact:
Investor Relations: Per Hillström, Head of IR,
firstname.lastname@example.org, +46 70 2952 912
Media: Viktoria Karsberg, Head of Corporate Identity and Communications,
email@example.com, +46 8 4545 734
This information is inside information that SSAB AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation and information that SSAB AB (publ) is obliged to make public pursuant to the Securities Markets Act. The information was submitted for publication, through the agency of the contact person set out above, at 7.30am CET on January 28, 2020.