Outokumpu Oyj - Company Announcement

Outokumpu – Update on impact of the recent technical issues in Calvert and market development

OUTOKUMPU OYJ
STOCK EXCHANGE RELEASE
December 10, 2014 at 12.00 pm EET


As communicated earlier Outokumpu's stainless steel mill in Calvert, Alabama,
USA has experienced technical issues in all of its three cold rolling lines
during the past six months. This has had a negative impact on customer
deliveries and increased costs. Following the damage calculations and
discussions with the insurance company, the cost impact of the incident is
estimated at EUR 34 million in 2014 which will be partly covered by insurance
still this year. Beyond 2014, the discussions with the insurer are ongoing. 

Outokumpu will record non-recurring costs of about EUR 20 million in the fourth
quarter in the Coil Americas business area. This amount consists of costs not
covered by the insurance as well as costs for which the insurance coverage
cannot be recognized in 2014. Compensation for part of these costs is expected
to be received in 2015. 

While two of the cold rolling mills have been back in operations after repair
work done in August, the 54 inch cold rolling line in Calvert is now expected
to be back in operations only in the beginning of 2015 after an outage since
June 2014. Outokumpu confirms the negative impact for deliveries at about
35,000 tonnes in 2014. Outokumpu estimates that the EBITDA excl. non-recurring
items breakeven target for the full year 2014 for business area Coil Americas
will be slightly missed. 

As indicated in early November, the operating environment for stainless steel
has been lackluster with volatile nickel prices and especially the distributor
sector has continued to push out orders to next year. While order intake for
the start of 2015 remains healthy Outokumpu expects delivery volumes in the
fourth quarter to be lower than originally estimated. In addition, hedging
losses in propane are expected in the fourth quarter due to significant decline
in oil price. Corresponding positive effect in the operative business is
expected next year. 

Outokumpu's fourth-quarter EBIT will be negatively impacted by the lower volume
outlook and propane hedges. However, taking into account the non-recurring
items booking in the Coil Americas business area the underlying EBIT is
expected to be on a similar level as in the third quarter and as guided in
connection with the third quarter results. 

For more information:

Investors: Johanna Henttonen, tel. +358 9 421 3804, mobile +358 40 530 0778

Media: Saara Tahvanainen, tel. +358 40 589 0223

Outokumpu Group



Outokumpu is a global leader in stainless steel. We create advanced materials
that are efficient, long lasting and recyclable - thus building a world that
lasts forever. Stainless steel, invented a century ago, is an ideal material to
create lasting solutions in demanding applications from cutlery to bridges,
energy and medical equipment: it is 100% recyclable, corrosion-resistant,
maintenance-free, durable and hygienic. Outokumpu employs more than 12 000
professionals in more than 30 countries, with headquarters in Espoo, Finland
and shares listed in the Nasdaq Helsinki. www.outokumpu.com

Attachments:

Calvert and market update 10122014 ENG.pdf