Interim report Q1/2022: Strong start to 2022
April 26, 2022 7:30 CEST 6 min read
The first quarter · Revenue was SEK 31,575 (19,661) million · Operating profit, excluding items affecting comparability, was SEK 8,377 (1,993) million · Operating profit, including items affecting comparability, was SEK 8,162 (1,993) million · Higher steel prices more than offset lower production and higher material costs · Earnings per share were SEK 5.84 (1.46) · Net cash was SEK 5,667 (net debt SEK 8,896) million
Comments by the CEO – strong start to 2022 in a turbulent environment
SSAB’s first quarter was characterized by high steel prices and earnings rose to a record level. All divisions posted strong results more than offsetting the impact of an unplanned stop in a blast furnace in Raahe, Finland, certain production disruptions in SSAB Americas, as well as higher raw material costs. The tragic situation with the war in Ukraine is affecting the steel markets and SSAB. We have minor operations in Ukraine through Ruukki Construction and our highest priority is to help our employees and their families.
Operating profit for the first quarter increased to SEK 8,377 (1,993) million. Net cash flow was SEK 2.9 (1.2) billion for the first quarter and the Group had net cash of SEK 5.7 billion at the end of the first quarter.
SSAB Special Steels’ operating profit increased to a record high SEK 2,104 (914) million and the operating margin rose to 26.7% (17.8%). SSAB’s high-strength steels support, among other things, our customers’ sustainability strategies and their ambitions to improve productivity and sustainability performance in machinery and other equipment.
SSAB Europe’s operating result increased to SEK 3,250 (758) million and the operating margin rose to 25.7% (8.6%). SSAB Americas’ operating profit increased to SEK 2,992 (258) million and the margin rose to 40.1% (7.1%).
The tragic situation in Ukraine affected the quarter in many ways. SSAB directly ceased sales to Russia and Belarus and discontinued new purchases of ore and coal from Russia until further notice. Several measures have been introduced to ensure access to raw materials, but there is a risk of disruptions related to sanctions and other fallout from the war in Ukraine. The war has driven up both raw material and steel prices. Order intake rose temporarily during the first quarter since our customers wanted to ensure supply of steel.
Ruukki Construction has minor operations in Ukraine and we are assisting our employees and their families with transport and accommodation, to leave the war zones and go to Poland and other nearby countries.
The outlook for demand and shipments in the second quarter is characterized by some uncertainty, including further issues with component supplies in the vehicle industry as well as bottlenecks continuing to affect logistics chains.
In January 2022, SSAB took a policy decision to fundamentally transform the Nordic strip production and to accelerate the green transition. The decision was taken against the background of strongly growing demand for fossil-free steel. The work with the feasibility studies for the planned mini-mills in Luleå and Raahe is proceeding. In April, SSAB’s, LKAB’s and Vattenfall’s joint HYBRIT initiative received official support from the EU as one of seven projects chosen under the Innovation Fund. The grant amounts to a total of EUR 143 million and consists of EUR 108 million for HYBRIT’s demonstration plant in Gällivare, EUR 30 million for SSAB for the conversion of Oxelösund and EUR 5 million for LKAB for the demonstration of fossil-free DRI-pellets production.
SSAB invites you to a presentation of the report for the first quarter of 2022 at 9.30am CEST on Tuesday, April 26, 2022.
The report for the first quarter of 2022 will be presented by SSAB’s President and CEO Martin Lindqvist, and CFO Leena Craelius.
The press conference will be held in English and live webcast on SSAB’s website www.ssab.com. You can also participate in the briefing by telephone.
Venue and time of briefing: World Trade Center (WTC) Stockholm, Kungsbron 1, Conference room Manhattan, 9.30am CEST.
Sweden: +46 856 6426 51
United Kingdom: +44 3333 0008 04
United States: +1 63 1913 1422
Conference ID: 86129566#
Link to webcast: https://edge.media-server.com/mmc/p/rwd2jatt
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 Group 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 CEST on April 26, 2022.