Steel Mills

SSAB America Q3 Sales up 29%

October 28, 2014

SSAB Americas sales jumped 29 percent year over year to SEK 3,716 million ($507 million) for an operating profit of SEK 558 million ($76 million). Profit was attributed primarily to higher steel prices and improved productivity. Steel shipments increased 5 percent to 559,000 tonnes (616,191 tons) on a year over year basis and 7 percent from the previous quarter.

Compared to third quarter 2013, crude steel production was 9 percent higher and steel production was up 10 percent. Steel prices were up 2 percent from second quarter 2014.

SSAB America operations in the first three quarters of 2014 contributed 21 percent of SEK 45 billion ($6.1 billion) external sales and 33 percent of SSAB EBITDA of SEK 3.4 billion ($464 million).

President and CEO Martin Lindqvist commented, “We anticipate that our North American operations will continue to develop positively, driven by continued good demand from end-customers. However, as usual we expect a seasonal slowdown in demand towards the end of the year, primarily in demand from Steel Service Centers.”

SSAB reports demand in the North American steel market was good in the third quarter but noted that distributor inventory levels rose due to increased import volumes. Recent trade actions may have an impact on growing inventories.

Heavy transport was strong in the US due to SSAB’s development of its railcar business. U.S. automotive demand remained robust and construction machinery showed signs of improvement in the lifting segment.

Scrap metal spot prices for the US operations were higher at the beginning of the quarter but by end of September were 1 percent lower than the previous quarter and 2 percent higher year over year.

A maintenance outage is scheduled for the Montpelier facility in fourth quarter. The cost of the outage is estimated to be SEK 175 million ($23.9 million).

SSAB Americas produces plate steel in Montpelier, Iowa and Mobile, Ala.

(Note: third quarter data is based on two months actual income and one month pro forma. 1 SEK (Swedish Krona) = 0.14 US Dollar)