Swiss Steel Group achieves solid profitability in first quarter of 2022
by David Fleschen
Swiss Steel Group, a world leader in special long steel, today reported revenue of EUR 1,028.8 million for the first quarter 2022 compared with EUR 751.6 million in the prior year quarter. This equates to an increase of 37 %. Sales volume decreased by – 6 % to 480 kilotons, from 510 kilotons in Q1 2021. Adjusted EBITDA came to EUR 75.0 million, up from EUR 44.5 million in the prior year quarter. Net debt amounted to EUR 849.6 million, an increase of EUR 129.1 million from EUR 720.5 million recorded at the end of 2021.
Business performance in the first quarter of 2022
At 480 kilotons, – 5.9 % less steel was sold in the first quarter of 2022 compared with the same quarter of the previous year (Q1 2021: 510 kilotons). This was attributable to a – 4.1 % decrease in the sales volume for quality and engineering steel and a – 17.9 % decrease in the sales volume for stainless steel, while the tool steel sales volume increased by 2.9 % quarter over quarter.
The average sales price per ton of steel was EUR 2,145 in the first quarter of 2022 and therefore considerably higher than in the same quarter of the previous year, when it stood at EUR 1,476 per ton. The transfer of higher raw material prices into our markets led to higher sales prices. Moreover, base prices were raised. The Group also started to implement the announced energy surcharges by the end of 2021 – passing on volatile energy prices and general inflation.
Consequently, resulting from higher average sales prices, revenue in the first quarter of 2022 increased by 36.9 % to EUR 1,028.8 million compared to the same quarter in the previous year. The increase in revenue was spread across all product groups. By region, revenue climbed in all our sales markets, with the strongest rise in the American market (+ 43.4 %), supported by higher activity in the oil and gas industry.
Adjusted EBITDA was EUR 75.0 million in the first quarter of 2022, a significant increase on the same quarter of the previous year (Q1 2021: EUR 44.5 million).
Free cash flow (cash flow from operating activities less cash flow from investing activities) in the first quarter of 2022 was EUR – 108.1 million (Q1 2021: EUR – 85.1 million) as prices for raw materials and energy increased further, leading to temporary investments in net working capital.
Source: Swiss Steel Group, Photo: Fotolia