Swedish steelmaker SSAB on Tuesday outlined a strategy to accelerate growth in its premium and decarbonized steel offerings, aiming to boost profitability amid recent operational and regulatory challenges.
The company said it targets these high-margin products to account for 65% of total shipments by 2030 and 75% by 2035, up from 55% today.
This strategic push comes as SSAB navigates a one-year delay to its flagship 4.5 billion euro green steel mill in Luleå, Sweden, and a sanction evaluation from the country's financial regulator over a past asset writedown.
Despite the headwinds, the company projects its investments will lift its earnings before interest, taxes, depreciation, and amortization to around 23 billion Swedish kronor after 2030, compared to 14 billion in the previous business cycle.
"Over the next five years, our focus is to execute investments according to plan and budget while we continue to strengthen our premium offering from existing mills," said President and CEO Johnny Sjöström.
The Luleå investment alone is expected to improve earnings by more than 5 billion Swedish kronor, according to the company.
SSAB also reiterated its financial targets, including a dividend of 40% of profit after tax.
More from this issuer
Related coverage
Swedish steelmaker SSAB's European division swung to an operating loss in the third quarter, hit by lower prices, as the European Commission proposed new measures to protect the region's steel industry.
Swedish steelmaker SSAB said Tuesday it is facing potential sanctions from the country's financial regulator over a large 2022 asset writedown.
Swedish steelmaker SSAB said Monday it has secured an additional 430 million euros in green financing, completing the funding package for its planned fossil-free steel mill in Luleå, Sweden.
Swedish steelmaker SSAB is postponing the start of its new fossil-free steel mill in Luleå by one year, citing delays in reinforcing the local power grid.