Sharp rise in sales of core niche products

Sharp rise in sales of core niche products SSAB today presented its results for the first half of 2004. Profit after financial items increased by SEK 905 million to SEK 1,685 (780) million. - The result for the first half of the year is the best since 1995 and the second best ever. The strong result also entails that cash flow increased significantly and amounted to SEK 900 (37) million, notes CEO Anders Ullberg in a comment on the report. Demand for steel in Europe continues to increase at a moderate rate and demand for the core niche products, extra and ultra high-strength sheet as well as quenched steels within the plate area, has remained strong on all markets. - The main explanation for the increase in profit is precisely that sales of our core niche products have grown so strongly, Anders Ullberg points out. Deliveries of extra and ultra high-strength sheet increased during the first half of the year by 37% compared with last year, primarily due to increases in the truck and car segments. For deliveries of quenched steels, the corresponding increase was 27%. The rate of increase was significantly in excess of what is required to achieve our strategic goals of increasing volumes of extra and ultra high-strength sheet by 100% and volumes of quenched steels by 50% over a five-year period. - Profit has also benefited from the fact that our processing costs in absolute terms were lower than during the first half of last year. This has been achieved through a number of cost-cutting projects which commenced during the second half of last year, continues Anders Ullberg. - Today's report demonstrates that the activities and projects we have carried out within our focus areas, namely to increase volumes of core niche products, to hold down processing costs and to create a strong cash flow, have achieved the desired effect, emphasises Anders Ullberg. Anders Ullberg concludes by stating that prices for both steel products and raw materials are increasing significantly. Based on the agreements that have been reached, it is believed that during the third quarter prices for sheet and plate in local currencies will on average be approx. 10% higher than during the second quarter. At the same time, raw materials costs during the second half of the year will be significantly higher. For example, costs for coal and coke will be almost SEK 300 million higher than during the first half of the year. ------------------------------------------------------------ This information was brought to you by Waymaker http://www.waymaker.net The following files are available for download: http://www.waymaker.net/bitonline/2004/07/19/20040719BIT00130/wkr0001.pdf