Results for 2010

Results for 2010

 

The full year

  · Sales increased by 34% to SEK 39,883 (29,838) million              
  · Operating profit of SEK 1,084 (-1,592) million           
  · Profit after financial items of SEK 682 (-2,061) million         
  · Earnings per share of SEK 2.21 (-2.69)                    
  · Operating cash flow of SEK -212 (4,868) million and cash flow from
current operations of SEK -731 (3,387) million
  · Net debt/equity ratio of 58 (49)%
  · Return of 2% on both working capital and equity, while these figures
were negative for 2009
  · Proposed dividend of SEK 2.00 (1.00) per share, equal to SEK 648
(324) million.                  

The quarter

  · Sales increased by 23% to SEK 10,205 (8,284)
million                         
  · Operating profit of SEK -81 (430) million     
  · Profit after financial items of SEK -176 (348) million
  · Earnings per share of SEK -0.39 (1.09)           
  · Operating cash flow of SEK -123 (799) million and cash flow from
current operations of SEK -376 (856) million     

Unless otherwise stated, the report relates to the continuing
operations, i.e. excluding the tubular business. In the report, amounts
within brackets refer to the same period last year.

Comments by the CEO     

As a consequence of the recovery in 2010, operating profit improved by
SEK 2.7 billion compared with 2009, to SEK 1.1 billion. Although the
pace of the recovery slowed down somewhat towards the end of the year,
we perceive a positive trend, among other things, in sales of niche
products. Capacity utilization during the year was approx. 85 (55) per
cent. We have not yet been able to fully compensate for increased raw
material costs. During 2010, the strong Swedish krona negatively
impacted on operating profit by approx. SEK 1.5 billion. We continue to
focus on improving our cost efficiency.

The result for the fourth quarter is in line with the announcement
published on December 23, 2010. Demand during the quarter was weaker
than expected, particularly in Europe and North America, while Latin
America and China demonstrated continued stable demand. The strongest
segments during the fourth quarter were mining and heavy transports,
while the lifting remained weak. Furthermore, earnings were negatively
affected by a disruption in production at one of the blast furnaces in
Oxelösund. In light of the weak market conditions during the quarter,
the opportunity was taken to bring forward a maintenance outage at the
plant in Mobile.

Having now entered the first quarter, the market picture is somewhat
brighter than we experienced during the fourth quarter of 2010. It is
believed that demand in Europe will generally continue to develop
positively, although still slowly during the first quarter. The market
for SSAB's strip products is expected to strengthen. The mining and
heavy transports are the strongest segments within Europe, while the
lifting segment has not yet shown any signs of recovery.               

In North and Latin America, the mining segment and parts of the energy
segment are expected to continue to be the strongest segments during the
first quarter, but the heavy transport and automotive segments are
recovering. Positive signals are being received from the wind power
industry, and orders from that industry have begun to increase. Overall,
the SSAB Americas business area now has a good order book and we are
fully booked for the first quarter.

In Asia and Oceania, the mining and heavy transport segments are
expected to continue to perform well, although the floods in Australia
may temporarily dampen consumption of abrasion-resistant steel. The
lifting and automotive segments began the year with a clear recovery,
following a slowdown during the second half of 2010.

Market prices for raw materials are showing an upward trend, which in
the case of coal is reinforced by the floods in Australia. Thanks to
current stocks of coal, the floods will have no impact on our production
capability during the first quarter. In regards to iron ore, our
contracted prices in dollar terms are unchanged in the first quarter.
Scrap metal prices in North America have risen.

Within EMEA, the fall in prices during the fourth quarter of 2010 is
expected to have a somewhat negative impact on contracts signed for
shipment during the first quarter, while prices on newly executed
contracts for later shipment are increasing. Improved demand and higher
scrap metal prices in North America are expected to lead to increased
steel prices, but we will not, however, cover in full the in-creased
scrap metal prices during the first quarter.

The cold winter weather and the large-scale stoppages in rail traffic in
Sweden had a negative impact on our shipment capability at the beginning
of the first quarter.

The capital expenditure programs to increase our production capacity of
niche products are proceeding according to plan.

My assessment is that we are in a period of continued recovery. The
objective is to continue to gradually compensate for increased raw
materials costs.

                                                                        
                Martin Lindqvist, President and CEO

Presentation of the quarterly report

SSAB invites to a presentation of the quarterly report on Friday,
February 11, 2011.

Venue and time of briefing: World Trade Center (WTC) Stockholm,
Kungsbron 1, Conference room Manhattan, 10:00 a.m. CET.

The press conference will be held in English and live webcasted on
SSAB's website www.ssab.com (http://www.ssab.com/). Instructions on how
to participate in the webcast will be available on SSAB's website,
including presentation material for downloading.

For further information, please contact:

Helena Stålnert, Executive Vice President, Communications Phone: +46 8
45 45 734

Catarina Ihre, Director, Investor Relations Phone: +46 8 45 45 729