SSAB Announces Weak Third Quarter Results
SSAB announced weak third quarter 2012 earnings. SSAB expects an operating loss of approximately SEK -700 million for 3Q12.
Volume for strip products is much weaker than 2Q12 while third quarter capacity utilization within SSAB EMEA’s strip operations has been slightly less than 60%. However, demand is expected to increase in the future, resulting in improved capacity utilization.
Iron ore prices are another reason for the poor results in 3Q12. Lower iron ore prices are expected to put downward pressure on steel prices and impact 1Q13 earnings.
SSAB EMEA has an efficiency improvement program which is expected to be complete during first quarter 2013. This program will be save the company SEK 800 million annually. However, SSAB EMEA will be reducing the amount of white collar employees by 10% by fall to cut costs.
SSAB mentioned its Americas’ operations have been affected by weak demand. SSAB APAC has also been affected by the economic slowdown in China.