Signs of recovery seem to be appearing
During the first quarter 2009 the stainless steel market has been featured by very low levels of demand due to the economic recession and the industrial activity collapse. Consumption, although having improved with regard tot he last quarter 2008, has still very low levels, which has led the world industry to cut productions by around 50%.
This collapse of demand has caused policy of final effective price in the market involving very negative margins for the whole industry.
In the last weeks recovery signs have begun to be noticed in the main markets, which have favoured announcements of price rises in Europe and America. The activity in the Asian markets is increasing and also the demand from the rerollers.
In April Acerinox Group has already announced base price rises in Europe and America, equivalent to 100 euros per ton, which the market has welcomed.
Nickel price stability during the last months, together with the low levels of inventories in all the markets, make us expect a market recovery in the third quarter.
The melting production of the Group during the first quarter 2009, 339,574 Mt, has been 19.4% higher than the output of the last quarter 2008, but it has been 45.8% lower than the production achieved during the first quarter of the previous year.
In year 2008, Acerinox Group has been the first stainless steel producer worldwide for the second consecutive year.
Accumulated net sales in the quarter, 617 million euros, is 60.6% lower than the invoiced figure in the like period of the year before.
The Geographical distribution of sales is similar to that of year 2008, which shows that the market weakness has a global effect worldwide.
The Group has registered a negative result before taxes and minorities of 141.22 million euros and after taxes and minorities , the loss totals 92.98 million euros.
Condensed Profit & Loss account. Acerinox Consolidated Group
The strong adjustment measures taken by the Group have reduced the exploitation expenses by 23%.
The Group indebtedness , 993.14 million euros, is 49% of the current credit lines, which allows to have liquidity to finance the working capital and to keep the investment plan, which will allow us to make the best use of the improvements of the market situation, as soon as they take place.
Condensed Balance Sheet. Acerinox Consolidated Group
Returns to the shareholders
Our commitment with our shareholders together with the financial strength of the Group allow us to consolidate the returns to the shareholders, keeping it at 0.45 euros gross per share despite the international recession situation.
ACERINOX, S.A. Board of Directors will proposed the General Shareholders meeting a complementary dividend on account of year 2008 of 0.15 euros gross per share to be paid in July and an issue premium refund of 0.10 euros, which will be effective in October.
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