Outokumpu Oyj's half-year report for January-June 2023 reveals a mixed landscape, with both promising highlights and challenges. Adjusted EBITDA for the first half of 2023 amounted to €394 million, a commendable result given the prevailing market conditions. However, the second quarter saw tempered stainless steel deliveries in Europe, adversely impacting profitability.President & CEO Mr. Heikki Malinen acknowledges the weakened market conditions in Europe but takes pride in Outokumpu's solid performance in the Americas. The company's strong balance sheet and successful de-leveraging efforts have positioned it well to navigate cyclical downturns in the stainless steel industry.Outokumpu's strategy spans multiple phases, with the second phase focused on optimizing current assets. The upcoming third phase, set to commence in 2026, aims to bolster Americas expansion, enhance European competitiveness, integrate value chains, and strengthen sustainability leadership.The company's resilience is evident in the remarkable turnaround of its US business, which now seeks to capitalize on the demand for locally produced, sustainable stainless steel. A feasibility study is underway to explore expansion options, including increasing cold rolling capacity and investigating hot rolling arrangements. A potential investment decision to build a hot rolling mill is being considered.In its commitment to sustainability, Outokumpu has made significant strides in managing costs, inflationary impacts, and sustainability actions. The supply chain plays a pivotal role in the company's decarbonization journey, with a focus on sourcing raw materials with minimal CO₂ emissions. In Q2 2023, Outokumpu maintained a remarkable 94% recycled material content.However, challenges persist in the European market, leading to tempered expectations for Q3 2023. Stainless steel deliveries are expected to decrease by 5-15% compared to Q2, following a seasonal pattern. The business area Ferrochrome will face a negative impact of approximately €10 million due to a planned maintenance break. Additionally, maintenance costs for the rest of the group are anticipated to rise by up to €10 million.
Outokumpu Oyj's half-year report for January-June 2023 reveals a mixed landscape, with both promising highlights and challenges. Adjusted EBITDA for the first half of 2023 amounted to €394 million, a commendable result given the prevailing market conditions. However, the second quarter saw tempered stainless steel deliveries in Europe, adversely impacting profitability.President & CEO Mr. Heikki Malinen acknowledges the weakened market conditions in Europe but takes pride in Outokumpu's solid performance in the Americas. The company's strong balance sheet and successful de-leveraging efforts have positioned it well to navigate cyclical downturns in the stainless steel industry.Outokumpu's strategy spans multiple phases, with the second phase focused on optimizing current assets. The upcoming third phase, set to commence in 2026, aims to bolster Americas expansion, enhance European competitiveness, integrate value chains, and strengthen sustainability leadership.The company's resilience is evident in the remarkable turnaround of its US business, which now seeks to capitalize on the demand for locally produced, sustainable stainless steel. A feasibility study is underway to explore expansion options, including increasing cold rolling capacity and investigating hot rolling arrangements. A potential investment decision to build a hot rolling mill is being considered.In its commitment to sustainability, Outokumpu has made significant strides in managing costs, inflationary impacts, and sustainability actions. The supply chain plays a pivotal role in the company's decarbonization journey, with a focus on sourcing raw materials with minimal CO₂ emissions. In Q2 2023, Outokumpu maintained a remarkable 94% recycled material content.However, challenges persist in the European market, leading to tempered expectations for Q3 2023. Stainless steel deliveries are expected to decrease by 5-15% compared to Q2, following a seasonal pattern. The business area Ferrochrome will face a negative impact of approximately €10 million due to a planned maintenance break. Additionally, maintenance costs for the rest of the group are anticipated to rise by up to €10 million.
