Ruukki is a growing, integrated chrome producer supplying specialist products to the expanding steel and stainless steel industries. The Group is focused on utilising its experience and technological advantages to deliver profitable and sustainable growth. The Company is listed on the NASDAQ OMX Helsinki (RUG1V) and the Main Market of the London Stock exchange (RKKI).
The Group’s chrome operations are split into two businesses: Speciality Alloys, which consists of the Turkish mining operation TMS and the German processing plant, EWW, and FerroAlloys in southern Africa, which consists of the Stellite mining operation, the Mecklenburg mine development project and the alloy processing plant, Mogale, all in South Africa and the mine development project Waylox in Zimbabwe.
Ruukki exports raw chrome ore directly to China and sells a diverse range of chrome products, through its centralised sales and marketing arm RCS, internationally to customers operating in the stainless steel and steel sectors, including the automotive, aerospace and power generation industries.
Chrome producer Ruukki Group (LON:RKKI) this morning reported an increase in production and sales in the first quarter, which helped it to record revenues of €46.7 million.
Ruukki added that it expects its 2012 performance to be in line with the previous year.
Both the group’s Turkish mining operation TMS and the recently acquired German ferrochrome-maker Elektrowerk Weisweiler GmbH (EWW) in the speciality alloy business continued to produce at nearly full capacity during the period.
At the ferroalloys business, the Satellite mine increased volumes by 73 percent following a successful ramp-up last year.
The Mogale processing plant was placed on care and maintenance for the first half due to the decision to accept electricity buy-back arrangement with Eskom and keep majority of the furnaces shutdown.
Total production for the quarter amounted to 91,167 tonnes, up 3.8 percent from a year earlier.
Despite the 34.3 percent surge in revenues on sales of 32,814 tonnes of processed products, up 14.3 percent from a year earlier, EBITDA declined to €2.8 million from €3.5 million last year. The company explained that the production cuts increased the supply of chrome ore for export, which drove down the prices.
Prices for both the company’s main product Charge Chrome and chrome ore were lower compared with the first quarter of 2011.
Ruukki said that while the ferroalloy market is expected to remain volatile, the market for specialty alloy products is estimated to be more stable, but uncertainty remains in 2012 as well.
“I am pleased to report our best revenue performance so far although this was unable to be translated into an increased EBITDA due to the lower prices we received for our products compared to the equivalent period in 2011,” said chief executive of Ruukki Thomas Hoyer.
“I believe this strategic acquisition (of EWW) will enhance the long-term profitability of the business as we replace the tolling arrangement with security of supply.
“The transaction is conditional on the decision of the annual general meeting, and if successful, we will have complete control over our assets and a secured and fully integrated supply chain from mine to customer across the group.”