Sweden-headquartered SSAB posted record revenue in the first quarter, but uncertainties connected to the war in Ukraine and high input costs continue to loom in the market.
SSAB’s consolidated revenue surpassed SEK 31 billion ($3.19 billion) in Q1, some SEK 12 billion more in Q1 2021. Higher turnover was mainly supported by significantly higher sales prices across the globe. Shipments also grew on-year at the Europe and Americas units.
“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,” says SSAB chief executive Martin Lindqvist. The Raahe blast furnace suffered a stoppage of approximately five weeks between February and March, Kallanish notes.
Operating profit also surpassed SEK 8 billion, compared to almost SEK 7 billion in Q1 2021.
The biggest uncertainty for the future is the impact of the war in Ukraine. “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,” Lindkqvist adds.
Shipments from the Americas and special steels divisions in Q2 are expected to be higher than in Q1. For SSAB Europe, shipments should be only marginally higher. Realised prices, on the other hand, seem to be close to their peaks as in Q2 in Europe and the Americas they should only be marginally higher.
Emanuele Norsa Italy