The operating profit of the Swedish manufacturer SSAB in the third quarter on Wednesday was well below market forecasts. As the company explained, its earnings were affected by the negative situation in the European market and added that they expect a further decline in demand in the current quarter.
SSAB's quarterly operating profit fell to SEK 150 million (approximately $ 15.52 million) from SEK 1.39 billion in the third quarter of last year.
"To further reduce costs and capacity, we will shutdown one of the blast furnaces in Raahe at the end of November," the company warned.
Analysts predicted SSAB's operating profit of 470 million kroons.
“The results were, as we expected, unsatisfactory, especially in Europe, where prices for coking coal and iron ore began to decline, but less than steel prices,” analysts at Credit Suisse quoted Reuters as saying.
SSAB said it expects a further drop in steel demand in Europe, which will accelerate especially towards the end of the year.
Previously reported , that another steel company, Schmolz + Bickenbach, announced the crisis in the European steel industry and talked about financial problems.
SSAB is a Swedish steel company founded in 1978. Specializes in the production of high quality, high strength steels. The annual volume of steel production is over 8 million tons. The head office of the company is located in Stockholm.
