Update regarding actions taken due to the Covid-19 situation
April 01, 2020 8:30 CEST 6 min read
SSAB implements several short-term actions across the business to mitigate the effects of Covid-19 and the total annualized savings are estimated to exceed SEK 1 billion.
During the first three months of the year the business has largely proceeded according to expectations. SSAB´s focus during the first quarter has been to reduce risks of spreading the Covid-19 virus, including measures to protect the health and safety of our personnel and at the same time sustaining operations.
Going forward, the spread of Covid-19 and its effects on industrial production, political decisions and the economy in general, will also impact SSAB. A number of short-term actions are being implemented across the Group to mitigate the effects. In Sweden, SSAB and its union organizations have reached a framework agreement on short-time work allowance and in Finland employer-employee negotiations have been initiated. Several cost saving measures are also being implemented in other countries.
The short-term actions to reduce cost will imply a temporary negative effect on the salaries for many employees. The members of the SSAB Group Executive Committee have therefore decided to reduce their own salaries by 10 percent from April 1.
Annualized savings from the short-term actions are estimated to exceed SEK 1 billion. Production levels will be adjusted to the demand situation as required, and as an example production in Borlänge and Hämeenlinna is planned to be closed one week per month during at least April and May. Blast furnace output will be reduced in line with market demand.
SSAB is monitoring the situation closely and is prepared to take additional actions where required to minimize the negative consequences on our operations and to protect health and safety.
SSAB has increased its liquidity preparedness significantly. In total, cash and committed liquidity amount to approximately SEK 21 billion as of March 31, 2020, and maturities during the remainder of 2020 amount to approximately SEK 5 billion (whereof around SEK 4 billion refers to commercial papers).
We have to adapt and adjust our business to the situation. Plans are being implemented in all parts of SSAB in order to address the situation in the best way possible and to secure our long-term competiveness.
Stockholm, April 1, 2020
President and CEO
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