Swedish iron ore producer LKAB has issued its financial results for the first quarter of the current year.
In the first quarter of this year, LKAB registered a net profit of SEK 333 million ($41.4 million), compared to a net profit of SEK 607 million in the same quarter of the previous year. Sales revenues in the given quarter decreased by 9.8 percent year on year to SEK 3.77 billion ($468.4 million), while the company recorded an operating loss of SEK 171 million ($21.25 million) compared to an operating profit of SEK 375 million in the first quarter of 2015.
In the first quarter this year, the company’s iron ore output amounted to 6.9 million mt, increasing by 11.3 percent year on year. In the same quarter, the company's shipments rose by 6.8 percent to 6.3 million mt compared to 2014.
LKAB stated that in the second quarter of the current year it will present a detailed action plan aimed at reducing costs by at least SEK 800 million ($99.4 million) on an annual basis starting from the second quarter of 2017. The company’s strategy to maximize pellet production remains in place. Meanwhile, demand for LKAB’s pellet products is expected to be stable, while supply in the market is limited by the fact that Samarco, one of the world’s biggest producers of iron ore pellets, currently has no production following the dam accident in Brazil in November 2015.