Rautaruukki - Financial Statement Release

Rautaruukki Corporation: Profitability improved significantly, but was still unsatisfactory. Growth of 20-25 per cent in net sales and clear improvement in profitability anticipated for 2011

Rautaruukki Corporation Financial statement bulletin 3 February 2011 at 9am EET

October - December 2010 (Q4/2009)
- Order intake was EUR 647 million (43% growth).
- Comparable net sales were EUR 641 million (515).
- Comparable operating profit was -EUR 5 million (-32).
- Comparable result before income taxes was -EUR 12 million (-39).

January - December 2010 (2009)
- Order intake was EUR 2,326 million (34% growth).
- Comparable net sales were EUR 2,403 million (1,901).
- Comparable operating profit was EUR 38 million (-272).
- Comparable result before income taxes was EUR 8 million (-303).

Dividend proposal
The Board of Directors proposes payment of a dividend of EUR 0.60 per share
(0.45), which makes a total dividend payout of EUR 83 million (62).

Estimate of the financial outlook for 2011
Consolidated net sales in 2011 are estimated to grow 20-25 per cent year on
year. Profitability is estimated to clearly improve compared to 2010.


KEY FIGURES
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                                                    Q4/10  Q4/09   2010   2009
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Comparable figures

Comparable net sales, EUR m                           641    515  2 403  1 901

Comparable operating profit, EUR m                     -5    -32     38   -272

Comparable operating profit as % of net sales        -0.7   -6.2    1.6  -14.3

Comparable result before income tax, EUR m            -12    -39      8   -303



Reported figures

Reported net sales, EUR m                             641    521  2 415  1 950

Reported operating profit, EUR m                       -3    -39    -12   -323

Reported result before income tax, EUR m              -11    -46    -74   -359



Net cash flow before financing activities, EUR m      -19     78   -226     30

Earnings per share, EUR                             -0.21  -0.33  -0.57  -1.98

Dividend per share, EUR                                           0.60*   0.45

Return on capital employed, %                                      -0.3  -14.2

Gearing ratio, %                                                   44.7   22.3

Equity ratio, %                                                    55.3   59.9

Personnel on average                               11 384 11 913 11 693 12 664
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* Board of Directors' proposal


President & CEO Sakari Tamminen:"In 2010, the economy grew, especially in the emerging markets. Growth in Europe
remained slower than in the rest of the world, although the market environment
improved towards the end of the year.

For Ruukki, 2010 marked a turn for the better. We received a third more orders
than during the previous year. Orders grew in all our business areas, with the
strongest growth in the steel business and, towards the end of the year, in the
engineering business. Geographically, fastest growth was in Sweden and in our
new markets for special steel products in Brazil, China and Turkey.

In the construction business, demand remained quiet in commercial and industrial
construction. Delivery volumes rose in residential roofing products and in
infrastructure construction, where we strengthened our position in road and
railway construction in the Nordic countries. Sales of the new roofing products
we successfully launched on the residential construction market were brisk,
especially in Central Eastern Europe and Ukraine.

In the engineering business, market conditions improved in most of our customer
segments compared to the previous year and order volumes grew mostly from
manufacturers of materials handling, construction and mining industry equipment.
Strongest order growth was during the fourth quarter.  Order volumes for the
wind power industry and other energy equipment manufacturers decreased sharply.
Market conditions remained weak in the shipbuilding industry.

Our steel business recovered from the deep downswing of the previous year and
demand grew in a number of main customer segments, such as the heavy engineering
industry and automotive industry. Sales of special steel products developed
especially well and doubled compared to the previous year. During the past year,
we expanded our distribution network for special steel products particularly in
the emerging markets, such as Brazil and China.

Profitability improved significantly year on year, but our reported result was
still negative. The comparable result before taxes, however, already turned
positive due to increased delivery volumes of steel products, improved capacity
utilisation in steel production, growth in the sales of special steel products
and higher selling prices. Profitability of the solutions businesses -
construction and engineering - was still weak. Profitability of the construction
business was weakened by low capacity utilisation in commercial and industrial
construction and the weak profitability of certain projects. Also the
engineering business suffered from low capacity utilisation, on top of which its
profitability was adversely affected by the low price level of components,
especially in early 2010, and by small delivery volumes to equipment
manufacturers in the energy industry.

Last year, we made significant strategy outlines to take the company forward.
The cornerstones of our strategy are increased specialisation, strengthening our
market position and capitalising on the growth potential of the emerging
markets. We have set ourselves ambitious targets, but we have now a strong base
to achieve them. We will continue developing our solutions businesses -
construction and engineering - with the aim of increasing their share of our
consolidated net sales from a current figure of 34 per cent to 60 per cent. Our
good production and sales network, special-steel-based components, scalable
products and concepts - especially in the construction business - will help us
to grow our solutions businesses.

In 2010, the emerging markets accounted for approximately a quarter of our
consolidated net sales. We aim to increase this share to 50 per cent during the
next few years. We are looking to increase the share of special steel products
from a current figure of 27 per cent to 60 per cent of net sales in our steel
business. We aim to do this by, among other things, increasingly targeting sales
of special steels to the emerging markets, where demand is growing faster than
in other markets. On the Nordic steel product market, we intend to strengthen
our market position by further improving delivery accuracy and the quality of
our products and services throughout the supply chain.

The basis for 2011 is clearly better than for the previous year. Compared to
2010, industrial investments are forecast to grow in all our main market areas.
According to our estimates, increased activity in our customers' industries will
improve demand for our products in the construction and engineering businesses
and in the steel business, especially with regard to special steel products. As
a result of increased demand, we estimate the company's capacity utilisation
rate, especially in the solutions businesses, will be higher in 2011 than in
2010. We expect selling prices of steel products to rise during 2011 due to
improving demand and higher raw material prices. We have improved operational
efficiency corporate wide and our cost competitiveness is now clearly better
than in previous years. Our main objectives for the current year are to clearly
strengthen cash flow and to return our construction and engineering businesses
to profitability.

Consolidated net sales in 2011 are estimated to grow 20-25 per cent year on
year. Profitability is estimated to clearly improve compared to 2010."

Rautaruukki Corporation's full financial statement is attached to this bulletin.

For further information, please contact:
Sakari Tamminen, President & CEO, tel. +358 20 592 9075
Markku Honkasalo, CFO, tel. +358 20 592 8840

A presentation in English for analysts and the media will be held on 3 February
2011 at 10.30am EET at Ruukki, Suolakivenkatu 1, 00810 Helsinki.

A live webcast of the event may be followed online starting from 10.30am on the
company's website at www.ruukki.com/investors. The event can also be attended
through a conference call. To attend the conference call, please call the number
below 5-10 minutes before the scheduled start time: +44 (0)20 7162 0125, access
code: 886 231.

A replay of the webcast can be viewed on the company's website on 3 February
2011 from about 4pm EET onwards. An encore replay of the conference call can be
heard until 8 February 2011 at +44 (0)20 7031 4064, access code: 886 231.

The annual report and financial statements for 2010 will be published in full
during week 9.

Rautaruukki Corporation
Anne Pirilä
SVP, Communications and Investor Relations

Rautaruukki supplies metal-based components, systems and integrated systems to
the construction and engineering industries. The company has a wide selection of
metal products and services. Rautaruukki has operations in 27 countries and
employs around 11,700 people. Net sales in 2010 totalled around EUR 2.4 billion.
The company's share is quoted on NASDAQ OMX Helsinki (Rautaruukki Oyj: RTRKS).
The Corporation uses the marketing name Ruukki.

DISTRIBUTION:
NASDAQ OMX Helsinki
Main media
www.ruukki.com


[HUG#1484919]

Attachments:

Rautaruukki_financialstatementbulletin2010.pdf