NEW YORK SSAB Americas, a
subsidiary of Swedish steelmaker SSAB AB, saw its
fourth-quarter earnings plunge due to depressed demand and
falling U.S. prices.
"(Last year) was a very
challenging year for the steel industry and SSAB," president
and chief executive officer Martin Lindqvist said during a
conference call Feb. 8.
SSAB Americas posted operating
earnings of 110 million kronor ($17.06 million) for the three
months ended Dec. 31, down 73 percent from 414 million kronor
in the same period a year earlier.
The Stockholm, Sweden-based
parent said that its depressed earnings in the Americas were
due to decreased plate prices, lackluster steel demand and
political and economic uncertainty.
"U.S. steel demand was also
affected by the worries about the fiscal cliff combined with
destocking in (the fourth quarter)," Lindqvist said, adding
that the company expects restocking to take place in the first
and second quarters.
Plate prices in the Americas for
niche steels decreased 4 percent in the fourth quarter compared
with the previous quarter, while standard steel prices
decreased some 12 percent, the company said.
SSAB Americas also saw steel
shipments fall 9 percent in the quarter compared with the same
period a year earlier and were down 2 percent from the third
The steelmaker, which has mills
in Mobile, Ala., and Montpelier, Iowa, expects its earnings in
the Americas will be affected in the first and second quarters
as a result of a planned maintenance outage at its Montpelier
plant. The company estimates a setback of some 150 million to
200 million kronor ($27.27 million to $31.03 million).
One bright spot for the company
is the growth of the energy market, including wind towers,
particularly with the renewal of certain tax credits in the
U.S. market. "Weve seen a bit of optimism in the
wind-tower segment in North America, which is of course due to
the renewed production tax credits in the U.S.," Lindqvist
Concerning raw materials, Marco
Wirén, chief financial officer of the Swedish parent,
said that the companys 2012 coal procurement contract is
set to expire at the end of March. He noted that price
agreements for 2012 were 30 percent lower than in 2011.
Looking forward, the company
said it expects to see a rebound in the Americas compared with
"We expect volumes in the
Americas ... to improve compared with (the fourth quarter),"
Lindqvist said. "We think the trend in Europe continues to be