Rautaruukki - Financial Statement Release

Rautaruukki Corporation Financial Statement Bulletin for 2013: Clear improvement in operating profit year on year, cash from operating activities rose to EUR 184 million

Rautaruukki Corporation Financial statement bulletin 14 February 2014 at 9am EET

Rautaruukki Corporation Financial Statement Bulletin for 2013: Clear improvement
in operating profit year on year, cash from operating activities rose to EUR
184 million

October-December 2013 (Q4/2012)
- Net cash from operating activities was EUR 80 million (79).
- Order intake was EUR 574 million (624).
- Comparable net sales were EUR 590 million (634).
- Comparable operating profit was EUR 8 million (-34).
- Comparable result before taxes was -EUR 3 million (-42).

January-December 2013 (2012)
- Net cash from operating activities was EUR 184 million (172).
- Order intake was EUR 2,376 million (2,605).
- Comparable net sales were EUR 2,404 million (2,597).
- Comparable operating profit was EUR 39 million (-50).
- Comparable result before taxes was -EUR 1 million (-88).

Dividend proposal
The Board of Directors proposes that no dividend be paid for 2013 (0.20).

Guidance for 2014:
Comparable net sales in 2014 are estimated to grow compared to 2013. Comparable
operating profit in 2014 is estimated to improve compared to 2013.

KEY FIGURES
-----------------------------------------------------------------------
                                              Q4/13  Q4/12  2013   2012
-----------------------------------------------------------------------
Comparable figures
-----------------------------------------------------------------------
Comparable net sales, EUR m                     590    634 2,404  2,597
-----------------------------------------------------------------------
Comparable operating profit,
EUR m                                             8    -34    39    -50
-----------------------------------------------------------------------
Comparable operating profit
as % of net sales                               1.3   -5.3   1.6   -1.9
-----------------------------------------------------------------------
Comparable result before
income tax, EUR m                                -3    -42    -1    -88
-----------------------------------------------------------------------
Reported figures
-----------------------------------------------------------------------
Reported net sales, EUR m                       590    677 2,405  2,796
-----------------------------------------------------------------------
Reported operating profit,
EUR m                                             4    -59    34   -101
-----------------------------------------------------------------------
Reported result before
income tax, EUR m                                -6    -67    -6   -139
-----------------------------------------------------------------------
Net cash from operating activities, EUR m        80     79   184    172
-----------------------------------------------------------------------
Net cash before financing activities, EUR m      60     56   101     78
-----------------------------------------------------------------------
Earnings per share, EUR                       -0.07  -0.41 -0.10  -0.85
-----------------------------------------------------------------------
Return on capital employed, %                                1.8   -4.9
-----------------------------------------------------------------------
Gearing ratio, %                                            68.5   71.2
-----------------------------------------------------------------------
Equity ratio, %                                             45.0   45.6
-----------------------------------------------------------------------
Personnel on average                          8,638 10,468 8,955 11,214
-----------------------------------------------------------------------
Net sales and operating profit for 2012 have been restated for reasons of
structural comparability. Part of Ruukki Engineering's business was divested at
the end of 2012. The units excluded from the arrangement have been part of
Ruukki Metals since the start of 2013. Ruukki Engineering units transferred to
Fortaco and other Ruukki Engineering units have been eliminated from comparable
figures.

PRESIDENT & CEO Sakari Tamminen:"The continuing economic downturn in Europe impacted negatively on Ruukki's
business environment. The swing to positive GDP across the eurozone during the
second half of the year still failed to be reflected significantly in the form
of growth in utilisation rates and investments in the manufacturing industry in
Europe. Demand for steel in the EU in 2013 was down by about 2% year on year and
capacity utilisation rates in the steel industry remained low. Demand for
special steels outperformed demand for standard steel products in many market
areas, even though the general weakening of the steel markets was reflected also
in lower average selling prices of special steels. Construction activity in
Europe was at a lower level than in earlier years. Construction activity in
Finland was twofold. Renovation continued at the previous year's good level, but
activity in new construction was especially low. In Russia, construction
activity remained at a good level, especially in agricultural and industrial
construction, despite the slowing pace of economic growth.

Ruukki Metals' delivery volumes were slightly higher than in the previous year
and order volumes were down slightly. The decline of almost 10% in order intake
value and comparable net sales was due to clearly lower average selling prices
in the wake of weakened market conditions. Average selling prices also remained
low because of declining prices of the main raw materials used in steel
production. Weakened construction activity was reflected in Ruukki's
construction businesses in the form of somewhat lower orders in many market
areas. Ruukki Building Products' order intake was down 2% year on year, mostly
because of decreased infrastructure construction orders. Ruukki Building
Systems' orders were down 9% and the order book for building projects was 10%
smaller than a year earlier.

Comparable operating profit improved by EUR 89 million year on year and was EUR
39 million. As we anticipated a year earlier, difficult market conditions showed
the necessity of efficiency projects across all our business areas. Actions
taken under efficiency programmes delivered an improvement totalling around EUR
70 million in earnings performance. Ruukki Metals' operating result since the
second quarter shows that we have achieved in practice the aim of our cost
savings programme - profitable operations at a capacity utilisation rate of
80%. Consolidated cash flow from operating activities improved year on year and
was EUR 184 million. Improved cash flow was largely due to the better result
since net working capital freed during the period had an impact of EUR 62
million (173). Net debt decreased and gearing was 68.5% at year-end.

Ruukki Building Products showed the best improvement within the Group and
profitability for the whole year rose to a good level. Operating profit was up
EUR 14 million year on year. This was particularly attributable to a better
gross margin and the efficiency programme. A more favourable geographical spread
of sales of residential roofing products, more effective steering of sales of
building components and better functioning of business processes overall also
contributed to operating profit growth.

Ruukki Building Systems operating result for the whole year remained negative
despite significant profitability improvement. Profitability was weakened by
some loss-making steel structure contracts, which had already started in 2012and which had a negative impact totalling around EUR 8 million on the operating
result for the whole year. Improving the use of the production network, scaling
capacity in response to demand and cutting SGA costs were key to profitability
improvement. These efficiency actions, together with selective offering
activity, have paved the way for better profitability. Also the gross margin
level of Ruukki Building Systems' order book was good at the end of the year.

Good progress was made with accelerating sales growth of special steels by
acquiring new customers, developing new products and applications and by
expanding into new market areas. The past year saw a significant expansion of
the global distribution and sales network for special steels. New recruitments
strengthened the sales team. Compared to a year earlier, the results were seen
in clearly growing delivery volumes in many market areas. Likewise, order intake
for special steels showed clear growth year on year. The actions taken began to
be visible especially during the fourth quarter and sales of special steel
products rose to account for 37% of Ruukki Metals' net sales. Special steel
products accounted for 33% of Ruukki Metals' net sales for the whole year. We
aim to considerably grow volumes of special steel products and to increase sales
of special steels to EUR 850 million in 2015. Special steel products are notably
more profitable than standard products, the volumes of which we intend to scale
down as volumes of special steels rise.

Ruukki Building Products has a good market position and is aiming for profitable
growth especially through energy-efficient products and residential roofing
products. Development of components and solutions to optimise a building's
lifecycle energy efficiency is a key aspect. Ruukki Building Products' offering
is suitable for both renovation and new construction. In Ruukki Building
Systems, our main aim is still improved profitability through better project
management and more cost-efficient manufacturing.

We expect demand for steel to pick up slightly in 2014. We anticipate average
selling prices of steel products to remain stable during the first quarter of
the year. Special steel demand growth is expected to clearly outperform demand
for standard products, especially in market areas outside Europe.

We estimate comparable net sales in 2014 to grow compared to 2013 and comparable
operating profit in 2014 to improve compared to 2013.

After the report period, on 22 January 2014, Swedish steel company SSAB and
Rautaruukki announced a plan to combine the two companies. SSAB is to make a
public share exchange offer for Rautaruukki's shareholders recommended by the
Board of Directors of Rautaruukki. Solidium Oy, Rautaruukki's largest owner, has
given its full support for the combination and has undertaken to accept the
share exchange. I believe that the combination of Ruukki and SSAB gives an
excellent opportunity to continue the rationalisation of the cost base of the
companies and build a new Nordic steel producer that is able to transit the
steel business towards a global special steel company. There is also a good
synergy potential in the construction business which offers profitable growth
potential on top of the synergy benefits."

Rautaruukki Corporation's full financial statement bulletin for 2013 is attached
to this bulletin.

For further information, please contact
Sakari Tamminen, President & CEO, tel. +358 20 592 9075
Mikko Hietanen, CFO, tel. +358 20 592 9030

News conference for analysts and the media
A joint news conference in English both for analysts and the media will be
hosted on Friday 14 February at approximately 10.30am at Ruukki's head office,
Suolakivenkatu 1, 00810 Helsinki.

A live webcast of the event and the presentation by the company's President &
CEO Sakari Tamminen may be followed online on the company's website at
www.ruukki.com/Investors starting at 10.30am EET. This event can also be
attended through a conference call by dialling the number
below 5-10 minutes before the scheduled time:
+44 (0)207 1620 177 (calls outside Finland)
+358 9 2313 9202 (calls inside Finland)
Access code: 940875

A replay of the webcast can be viewed on the company's website from
approximately 4pm EET. A replay of the conference call will be available until
21 February 2014 at:
+44 20 7031 4064 (calls outside Finland)
+358 9 2314 4681 (calls inside Finland)
Access code: 940875

Rautaruukki Corporation
Taina Kyllönen
SVP, Marketing and Communications

Ruukki specialises in steel and steel construction. We provide customers with
energy-efficient steel solutions for better living, working and moving. We have
around 8,600 employees and an extensive distribution and dealer network across
some 30 countries including the Nordic countries, Russia and elsewhere in Europe
and the emerging markets, such as India, China and South America. Net sales in
2013 totalled EUR 2.4 billion. The company's share is quoted on NASDAQ OMX
Helsinki (Rautaruukki Oyj: RTRKS). www.ruukki.com

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


[HUG#1762012]

Attachments:

Rautaruukki Corporation Financial Statement Bulletin 2013.pdf