Report for the first quarter of 2016: Improved result and higher shipments

The quarter

  · Sales were SEK 12,964 (15,468) million
  · Operating profit, before depreciation/amortization, excluding items
affecting comparability, was SEK 744 (1,501) million
  · Operating profit/loss, excluding items affecting comparability, was SEK -190
(564) million
  · Profit/loss after financial items, excluding items affecting comparability,
was SEK -344 (350) million
  · Earnings per share were SEK -0.24 (0.52)
  · Items affecting comparability had an impact of SEK -2 (-31) million on the
result after tax
  · Operating cash flow was SEK 77 (784) million and net cash flow was SEK -244
(511) million
  · The Board of Directors has announced a proposal of a preferential rights
issue for existing shareholders of around SEK 5 billion. SSAB’s two largest
shareholders, Industrivärden and Solidium, have undertaken to subscribe for
their pro rata shares. A standby underwriting commitment has been issued by four
banks for the remaining amount
Comments by the CEO

SSAB posted an operating loss, excluding items affecting profitability, of SEK
190 million for the first quarter of 2016, an improvement of SEK 612 million
compared with the fourth quarter of 2015. This improvement was mostly driven by
higher volumes, lower maintenance costs and positive synergy impacts, but was
negatively impacted by lower average prices. Increased sales during the quarter
resulted in increased working capital, which led to slightly negative net cash
flow.

Shipments during the first quarter improved compared to the very weak trend
during the fourth quarter. This was mostly because apparent demand during the
first quarter was aligned with real demand. After a weak start to the quarter,
steel prices have risen both in Europe and in North America, albeit from a very
low level. We expect stable underlying demand in the company’s main markets and
slightly higher prices during the second quarter.

Today, we have announced our intention to strengthen the balance sheet through a
rights issue of SEK 5 billion in class B shares. SSAB’s two largest
shareholders, Industrivärden and Solidium, have undertaken to subscribe for
their pro rata shares of the rights issue. For the remaining amount, four banks
have issued a standby underwriting commitment. In addition, Swedbank Robur and
LKAB have expressed their support and their intention to vote in favour of the
rights issue. Subject to the rights issue, SSAB has a refinancing package in
place which gives significantly lower level of loans maturing during the next 3
-5 years and extended duration of credit facilities. SSAB targets a reduction of
the net debt by SEK 10 billion by the end of 2017, through the rights issue,
divestment of non-core assets and through cash flow from operations.

SSAB are once again increasing our objective in the various ongoing cost savings
programs, where synergies from the acquisition of Rautaruukki account for the
largest share. Our new target is to have reduced the cost level by SEK 2.8
billion, an increase of SEK 300 million, on an annual basis during 2017 compared
to the cost level at the time of the acquisition of Rautaruukki.

The measures taken will enable us to secure SSAB’s long-term possibilities to
continue to develop our activities to achieve our goals. A strongly improved
financial position will mean we are well placed to take advantage of the
opportunities in the market while driving growth in our well-defined focus
areas. At the same time, we are well prepared to sustain periods of low demand.
SSAB has excellent opportunities to achieve our ambition of industry leading
profitability through our unique position in high-strength steels and through
our strong home market positions.

Sustainability is an area that is becoming increasingly important. SSAB
currently already has highly carbon-dioxide-efficient production, but we have
now set our sights even higher. SSAB, LKAB and Vattenfall have initiated a
project to study the possibilities of a steelmaking process completely free of
carbon-dioxide emissions. Sweden is uniquely placed to be able to achieve the
vision of carbon-dioxide-free rolling production as a part of efforts to combat
climate warming.

This information is such that SSAB must disclose in accordance with the
Securities Markets Act. The information was submitted for publication on April
22, 2016 at 07.30 am.

Invitation to SSAB’s first quarter 2016 results briefing

SSAB invites you to a presentation of the quarterly report at 09.30am CEST on
Friday April 22, 2016. .

The press conference will be held in English and webcast live on SSAB’s website
www.ssab.com. It is also possible to participate in the briefing via telephone.

Venue and time of briefing: World Trade Center (WTC) Stockholm, Kungsbron 1,
Conference room Manhattan, 09.30am CEST.

Telephone numbers:

+ 46 8 505 564 74 (Sweden),

+ 44 203 364 5374 (UK),

+ 1 855 753 2230 (USA).

Link to webcast: Go to webcast (http://edge.media-server.com/m/p/4sgcdqdb)



For further information, please contact

Investor Relations: Andreas Koch, Head of Investor Relations,
andreas.koch@ssab.com, +46 8 454 57 29

Media: Viktoria Karsberg, Head of External Communications,
viktoria.karsberg@ssab.com, +46 8 454 5734
SSAB is a Nordic and US-based steel company. SSAB offers value added products
and services developed in close cooperation with its customers to create a
stronger, lighter and more sustainable world. SSAB has employees in over 50
countries. SSAB has production facilities in Sweden, Finland and the US. SSAB is
listed on the Nasdaq OMX Nordic Exchange in Stockholm and has a secondary
listing on the Nasdaq OMX in Helsinki. www.ssab.com.