Finland-based stainless steel producer Outokumpu has announced its financial results for the first quarter of the current year, indicating that it is extending its cautiously optimistic view of the markets for the second quarter. Underlying demand is expected to continue its recovery and the recent rally in the nickel price is expected to have a positive impact on market dynamics. The company estimates similar or somewhat higher delivery volumes and some improvement in base prices for the second quarter. The steady progress in cost-efficiency initiatives and synergies is expected to continue.
According to its financial results, in the first quarter Outokumpu recorded a net loss of €248 million, widening compared to a net loss of €152 million in the same period of 2013, while the company's sales for the first quarter this year decreased by 13.4 percent year on year to €1.61 billion.
Outokumpu's stainless steel deliveries in the first quarter of the current year rose by 9.1 percent year on year to 676,000 mt. Capacity utilization rates of the Outokumpu production facilities have improved reflecting the closure of the Krefeld melt shop in December 2013 and the progress in the Calvert ramp-up. In the first quarter, Outokumpu's average utilization rate in melting was about 85 percent compared to 80 percent in the same period of the previous year. In cold rolling, the average utilization rate was 75 percent, which is similar to the first quarter of 2013.
According to Outokumpu, global real demand for stainless steel products totaled 9.1 million mt in the first quarter of 2014, up by six percent compared to the fourth quarter of 2013. Especially in the Americas and Europe, Midde East and Africa (EMEA) regions, demand increased during the first three months of the current year by 14.9 percent and 12.7 percent quarter on quarter, respectively. However, demand in the EMEA region still remained below last year's first quarter level.