(Reuters) -Finland’s Outokumpu on Thursday called off plans to invest in more stainless steel capacity in the U.S. and in small nuclear production in Finland as the weak stainless steel market and high import pressures weigh on earnings.
Outokumpu said it was dropping a plan to invest in added production capacity in the United States due to “unpredictable” market environment, while it is seeking external parties to take over the development of a small modular reactor next to its site in Tornio, Finland.
In a separate statement, the stainless steel manufacturer reported a small core loss for the fourth quarter of 2024, as it had warned in December.
European steelmakers have been struggling with weak demand, cost inflation and cheaper imports from Asian rivals that has weighed on profits.
“Poor demand and increased imports have kept prices low,” Outokumpu said in the statement, and warned steel prices would remain under pressure also in the first quarter of 2025.
It also called on the European Union to react and protect its steel industry from unfair competition.
Outokumpu’s adjusted loss before interest, taxes, depreciation and amortisation was 3 million euros ($3.1 million) in the quarter, while analysts had expected a loss of 1 million on average.
In the Europe business area, which serves the group’s key market, quarterly EBITDA turned to a loss of 32 million euros due to weaker than expected market conditions, it said.
Stainless steel deliveries fell 8% from the prior quarter, but are expected to rise by 10% to 20% in the first quarter, it said.
First quarter EBITDA is also expected to be higher than in the fourth quarter, even with an estimated 15 million euro impact from a one-week strike in Finland in January.
Outokumpu proposed a dividend of 0.26 euro per share for 2024.
Its shares were up 4.5% as of 0936 GMT.
($1 = 0.9585 euros)
(Reporting by Jagoda Darlak in Gdansk and Anne Kauranen in Helsinki; editing by Milla Nissi)
