Outokumpu: strong start to the year

Outokumpu has reported a strong start to the year 2021, with stainless steel deliveries in the first quarter reaching 608,000 tonnes, up from 588,000 tonnes in the first quarter of 2020. Adjusted EBITDA increased to Euro177m.

Outokumpu’s sales amounted to Euro1,673m in the first quarter of 2021, up from Euro1,615m in the first quarter of 2020. Adjusted EBITDA increased to Euro177m from Euro106m and stainless steel deliveries were 3% higher compared to the reference period. Re-
alized prices were at a weaker level but lower costs supported profitability. Also some one-off provision and accrual reversals reduced costs. Raw material-related inventory and metal derivative gains amounted to Euro42m, compared to losses of Euro22m in the prior year period, mainly due to positive timing impacts.
EBIT was Euro116m, up from Euro45m and the net result amounted to Euro82m, up from Euro22m.

A comparison of quarter one 2021 with quarter four of 2020 shows that Outokumpu’s sales increased significantly compared to the previous quarter and amounted to Euro1,673m, compared to Euro1,350m. Adjusted EBITDA increased to Euro177m from Euro78m and total stainless steel deliveries grew by 16%. Profitability was supported by higher realized prices, especially in Europe, and fixed costs were at a lower level. Raw material-related inventory and metal derivative gains increased significantly from the previous quarter and amounted to Euro 42m compared to Euro15m, mainly due to positive timing impacts.

Improvement in all business areas
Outokumpu president & CEO Heikki Malinen commented: “We have had a strong start to the year. Outokumpu’s adjusted EBITDA increased to Euro177m in the first quarter and all business areas improved their performance compared to the previous quarter. Demand for stainless steel strengthened, which resulted in 16% higher stainless steel deliveries. A strong market environment and positive impacts from raw materials supported our profitability in the first quarter while in parallel we also determinedly executed our strategic measures.

“After launching the new strategy in November 2020 to de-risk the company, we have kept our focus on its rigorous implementation. Our target is to achieve a Euro200m EBITDA run-rate improvement by the end of 2022 and net debt to EBITDA below 3.0. We are executing our strategy systematically and we have achieved an annualized run-rate improvement of Euro84m so far. We are building a solid foundation for our business, outlined in the actions taken, and continue the diligent execution as planned.

“Business area Europe’s adjusted EBITDA amounted to Euro78m. Stainless steel deliveries increased by 13% compared to the fourth quarter and higher prices supported profitability.

More in StainlessSteelFocus June 2021

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