Rautaruukki Corporation has announced financial statement bulletin for fiscal year 2011.
October to December 2011 (Q4 2010)
Cash flow from operating activities was EUR 163 million (23)
Order intake was up 1% at EUR 651 million (647)
Comparable net sales were up 12% at EUR 718 million (641)
Comparable operating profit was EUR 40 million (-5), equating to 5.6% of net sales
Comparable result before taxes was EUR 50 million (-12), equating to 7% of net sales

January to December 2011 (2010)
Cash flow from operating activities was EUR 114 million (-64)
Order intake was up 15% at EUR 2,675 million (2,326)
Comparable net sales were up 16% at EUR 2,797 million (2,403)
Comparable operating profit was EUR 56 million (38), equating to 2% of net sales
Comparable result before taxes was EUR 22 million (8), equating to 0.8% of net sales

Dividend proposal
The board of directors proposes payment of a dividend of EUR 0.50 per share (0.60), to make a total dividend payout of EUR 69 million (83).

Estimate of the financial outlook for 2012
Net sales in 2012 are estimated to grow about 5%. Comparable operating profit is estimated to improve compared to 2011.

Key figures
Comparable figures

Reported figures

Mr Sakari Tamminen president & CEO of Rautaruukki said that "The past year was strongly divided into two. After a good start to the year, weakened demand followed during the summer due to the difficulties facing some economies in Europe. These changes in the business environment were reflected in Ruukki's business so that after a very good second quarter, the second half of the year was difficult, especially in our steel business. The capacity utilization rate of the entire steel industry in Europe was at a level of around 75% during the second half of the year and also the operating rate of our own steel business was low at about 80%. On top of this, the profitability of orders for steel products was lower than normal, especially in late summer and early autumn. Costs of raw materials for steel were higher than a year earlier, but, however, began to decrease towards the end of the year. The business environment in the construction and engineering businesses remained better than it did in steel products throughout the year, even though a return to a faster growth track was slowed down in part by market uncertainty. It seemed the uncertainty in the business environment had leveled off at the end of the year, and, for example, destocking which took place in the steel industry was reflected in the decline in prices for steel products leveling off."

He added that "Ruukki's profitability improved year on year despite a weakening of the business environment and a weak end to the year. The un profitability of the steel business burdened the latter part of the year. Weak profitability of the steel business was due to the low utilization rate and lower price level of orders in the wake of difficult market conditions, as well as to persistently high raw material costs. During the year, we particularly focused on improving the profitability base of our solutions businesses construction and engineering. Indeed, there was a clear improvement totaling EUR 63 million in operating profit of the solutions businesses and the starting point for 2012 is clearly better than a year ago. However, the solutions businesses were still slightly unprofitable and profitability must clearly be further improved. In the latter part of the year, our priority was to strengthen cash flow and reduce gearing. Cash flow in the last quarter was good, especially with the successful freeing up of working capital. Gearing decreased to 60%, which is in line with our long term target level. The focus on cash flow and related destocking was partly reflected in weaker profitability in the steel business."

Mr Tamminen said that "During the past year, we made some progress towards achieving our strategic targets: the share of net sales of the emerging markets rose as sales grew in Eastern Europe; likewise the relative shares of the solutions businesses and special steels also rose. Later in the year, growth in the share of special steels slowed down compared to the beginning of the year due, among other things, to a decline in demand from China, which turned out to be temporary. Our order intake was up by around 15% YoY. However, orders during the fourth quarter were about at the same level as a year earlier. In the construction business, new orders in residential construction showed the clearest growth in all market areas, with particularly strong growth in Finland and Poland. Orders in commercial and industrial construction increased in Russia in concept buildings and orders in Finland also showed good growth. Infrastructure construction continued at a good level. In the engineering business, order flows were good, especially in mining industry equipment manufacturing and materials handling equipment. The same demand had a positive impact also on orders in the steel business. Sales of special steel products developed well in our new market areas, especially in South Africa and Turkey."

He added that "Order flow in service centers within the steel business remained good also during the latter part of the year. Mill orders decreased during the third quarter and remained at the same level until the end of the fourth quarter. Signs of a slight improvement were seen at the very end of the year. Even though there is still clear market uncertainty, some degree of leveling off can, however, be noticed. Our starting point for 2012 is relatively good. The conditions to improve the profitability of the solutions businesses, especially in the construction business, are clearly better than a year ago. Also, with the exception of the unit in China and one individual project, the conditions for profitability of the engineering business are good. In the steel business, market inventories are in balance. Prices of steel products have leveled off and partly slightly risen. We have kept our fixed costs the same for three years, despite strong growth in our net sales. However, we still have much to do as regards cost competitiveness and increasing the flexibility of operations. We aim to strengthen cash flow also by improving working capital efficiency. Capital expenditure in 2012 will be in the region of around EUR 100 million, which is clearly below the figure for last year and consolidated annual depreciation. Net sales in 2012 are estimated to grow about 5%. Comparable operating profit is estimated to improve compared to 2011."