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Investing.com -- Shares of SSAB AB (STO:SSABA) climbed 3.6% after the company reported a stronger-than-expected first quarter, with EBITDA reaching SEK2,369 million, surpassing the Factset consensus of SEK2,103 million by 13%.
The increase was attributed to solid shipments in the Special Steel division. Despite low prices impacting the Americas in the first quarter, SSAB saw Europe exceed modest expectations with signs of a nascent recovery.
The Swedish steelmaker’s financials showed a dip in free cash flow to -SEK1.9 billion from SEK3.2 billion in the previous quarter, influenced by seasonal working capital outflows of SEK2.3 billion. Looking ahead, the second quarter is poised to benefit from higher quarter-over-quarter pricing, especially as timing lags are accounted for.
The price outlook remains stable, with an expected increase in Special Steels by 0-5%, Europe by 5-10%, and a significant rise of over 10% in the Americas. Shipments are anticipated to grow modestly, while raw material costs are predicted to remain stable or increase slightly. Notably, maintenance activities are scheduled for the second half of 2025.
Jefferies analysts commented on the results, stating, "We expect better QoQ EBITDA in 2Q, with higher prices in the Americas in particular (+38% YTD) to drive upgrades. Overall, despite increased macro uncertainty driven by trade barriers & tariffs impacting steel, with pricing benefit we see SEK11.6bn cons supported (JEFe:SEK10.1bn)."
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