Stainless steel maker Outokumpu cuts losses in Q2

Outokumpu, the Finnish stainless steel maker, continued to improve its financial results during the second quarter and reported lower-than-forecast major losses from cost cutting, but cash flow was negative. At the same time, the company predicts small losses in the third quarter.

The company has struggled this year in the face of low stainless steel prices. At the same time, the company's stainless products are supplied to many European countries. Stainless steel shipments totaled 675,000 tonnes in the second quarter. Outokumpu's performance continues to improve in line with management expectations.

The company said it expects a slightly larger operating loss from core operations in the third quarter than it experienced in the second quarter, mainly due to seasonal slowdowns in the European market. Outokumpu estimates overall stainless steel demand and pricing environment to be relatively healthy in the third quarter. The company expects further progress, albeit at a slower pace.

Earlier this year, as part of a broader policy that also included asset sales, the company increased its share issue. At the same time, 30 percent of the shares of Outokumpu are owned by the Finnish state. The company in the second quarter of this year was able to curb its main operating loss to 6 million, while the average expected loss was forecasted to be about 13 million euros. The company expects some decline in shipments in the third quarter and some improvement in base prices for stainless steel.