SSAB, the Swedish steel producer, saw a significant drop in earnings in Q1 but still exceeded analyst estimates, as its high-value specialty steel products mitigated the impact of lower prices and reduced demand in broader markets. The company stated that its facilities’ proximity to customers in Europe and the United States has shielded it from the effects of President Donald Trump’s tariffs. However, it noted that the second-quarter outlook remains “more uncertain than usual.”
Shares were up about 2.9% at 62.5 Swedish crowns at 1035 GMT, according to reports.
Jefferies investment banking reported that the company’s EBITDA (earnings before interest, taxes, depreciation, and amortization) dropped to 2.37 billion Swedish crowns in the first quarter, down from 4.14 billion crowns a year earlier. Despite the decline, the figure still exceeded the FactSet consensus estimate by 13%. They said the beat was due to the Special Steels division, and added that the European unit beat low expectations.
CEO Johnny Sjöström noted on an analyst call that SSAB had not faced any order cancellations after Trump’s tariff announcement at the beginning of the month. He also added that SSAB’s order intake in the U.S. for heavy industries such as energy, oil, and gas has been strong. Despite weaker demand in consumer-related steel sectors like autos and housing, these areas account for a small share of SSAB’s business.
SSAB anticipates slightly higher shipments this quarter across its Special Steels, Europe, and Americas divisions compared to the previous quarter. These specialized products include high-strength and ultra-durable steel grades. However, reports say that prices would vary across the three divisions – from “stable” for Special Steels to “somewhat higher” in the European unit and “significantly higher” in the Americas unit.
“Raw material costs should be “stable” in the Special Steels and European units and “somewhat higher” in the Americas division,” SSAB said.