Swedish iron ore producer LKAB has issued its financial and operational results for the second quarter and first half of the current year.
In the second quarter, the company registered a net profit of SEK 697 million ($73.11 million), compared to a net profit of SEK 1.52 billion in the second quarter of 2025, while its sales revenues decreased by 8.1 percent year on year to SEK 7.19 billion ($754.11 million), mainly due to foreign exchange effects, particularly related to currency hedging of the US dollar. In addition, LKAB recorded an operating profit of SEK 63 million ($6.61 million), down by 94.1 percent year on year from SEK 1.07 billion, amid lower sales revenues and higher costs for energy and maintenance.
In the given quarter, the company's iron ore output amounted to 6 million mt, up 3.4 percent, while its iron ore shipments decreased by 1.6 percent to 6 million mt, both on year-on-year basis. Despite geotechnical challenges at the Kiruna mine, LKAB maintained its production rate and kept all its processing plants operating during the quarter. Meanwhile, disruptions in the Middle East and around the Strait of Hormuz affected deliveries, though the company mitigated the impact by redirecting shipments to other customers, markets and ports.
Meanwhile, in the first half, the net profit of LKAB amounted to SEK 1.42 billion ($148.93 million), falling by 66.9 percent from the net profit of SEK 4.30 billion recorded in the first half of the previous year, while its sales revenues decreased by 13.5 percent year on year to SEK 15.09 billion ($1.58 billion). The company's operating profit for the first six months of the year came to SEK 923 million ($86.90 million), down by 80.4 percent from SEK 4.71 billion in the same period of 2025. The lower sales revenues were attributed to a stronger Swedish krona, lower iron ore prices and lower delivery volumes, while higher electricity prices and increased costs also weighed on operating profit.
In the given period, the iron ore output of LKAB remained unchanged year on year at 12.5 million mt, while its iron ore shipments decreased by 2.4 percent to 12.3 million mt. The conflict in the Middle East and the periodic closure of the Strait of Hormuz affected shipments as some customers were unable, or had limited capacity, to receive deliveries.
Regarding market conditions, LKAB stated that the global steel and iron ore market continued to be characterized by geopolitical uncertainty in the second quarter, particularly amid the conflict in the Middle East. Global crude steel production remained unchanged year on year, while output declined slightly in China and Europe. The average spot price for 65 percent Fe iron ore increased to $122/mt in the second quarter from $108/mt in the same period last year.
As for the outlook, LKAB stated that geopolitical and global economic uncertainty remains high amid tariffs, import restrictions and ongoing conflicts. The company noted that changed production conditions at the Kiruna mine could result in the temporary closure of a processing plant in the autumn, potentially affecting its production and delivery volumes in 2026. Nevertheless, LKAB expects long-term demand for its products, particularly its high-grade iron ore pellets, to remain strong given their role in the steel industry's transition.
