Good morning, ladies and gentlemen, to this presentation of the SSAB Q4 report. My name is Per Hillström.

I'm Head of IR at SSAB, and presenting today, we have our President and CEO, Johnny Sjöström, and CFO, Leena Craelius. If we look at the agenda, Johnny will start with an overview of the year and the quarter, then Leena will cover the financials more in detail, and then Johnny at closing with the outlook and the summary.

At the end, we will have good time for questions. By that, floor is yours, Johnny.

Thank you very much, Per, and good morning to all of you. I will start by going through the summary of 2025.

If we look at our safety performance during 2025, we can see that we had, again, an improvement in our lost time injury frequency, we came down to the level of 0.56, which is, according to me, a good achievement. I think also we I want to point out that the total recordable also reduced, and that's also a work that that we've been focusing on for quite some time.

Now going over to the revenues, the revenues were slightly lower than they were last year, if we look at the full-year outcome. Then a bit Then again, the market has been weak, it's understandable.

There's been a lot of turbulence related to the geopolitical situation, tariffs, et cetera, that has created a lot of uncertainties, hence one of the reasons why we ended up on a slightly lower revenue level. Then if you look at the operating result, we came out on 6.1 billion Swedish kronor for the full year.

I think that even though the market has been very very weak, first of all, we have a very strong geographical diversification with significant production in United States as well as Europe. Also I think that our premium strategy, selling unique products, generating unique customer value, is supporting us when times are a little bit tougher than they usually are.

Then, of course, I think that especially the SSAB Europe worked on the cost side, and they were able to improve their financial performance slightly. We also came out The net cash position for the end of the year ended up on 11.6 billion.

I think that's also a good achievement based on the fact that we have a lot of investments ongoing. We have a very strong balance sheet.

I think also I'm very happy with the financing package that that Leena was able to put together that strengthen our situation and our position. Then also the board has proposed that we should have a 2-krona dividend per share that will be decided in the AGM meeting further on this year.

Speaking of premium strategy and direction we're heading, there are a few things that I want to point out. Continuously, we develop new grades for certain applications or environments.

One of the grades that we have developed recently is a grade called Hardox HiAce. It is designed for wear resistance in application where you have sort of a corrosive environment targeting the stainless steel grades.

It comes with a superior hardness, but also a superior wear resistance in aggressive environments, and it's very very cost-competitive because it's much leaner compared to stainless steel. I also want to point out the investment ongoing in Mobile to increase our capacity of unique grades.

Not long ago, we extended the Q&S furnace, giving us more capacity, but we're also currently investing in what we call a tempering loop to be able to produce more of the advanced steel grades. Even though we had some turbulence last year when it comes to tariffs and the challenge to import material from Sweden into United States, we were still on a higher level when it comes to advanced high-strength steel to the automotive segment.

I think we came out pretty much on the same level as 2024. We haven't seen much of the reduction of volumes being sold in the United States so far.

I think also that one of the things that I want to point out is that we have developed tailormade a steel grade for the automotive segment, which is the Docol High Edge, which comes with a high edge ductility. When it's stamped or processed, we have edges which are much much more leaner and not you don't have those kind of shipments you can get for for advanced high-strength steel.

Tailormade for certain applications in the automotive industry, highly appreciated by the market. Then also we launched a new complex phase steel.

It's a cooperation together with Gestamp. I think what's unique in this case is that we're sort of targeting to increase the strength in the chassis, which is quite new, actually.

The chassis will then have a higher strength, and with the higher strength, you can actually reduce the thickness of the sheet material, making the car lighter, but also you consume less material, which is also good for the environment, but also good from a cost perspective. Then last but least not least, I want to point out that we have for our color-coated side produced by SSAB, but then further processed and sold by Ruukki Construction, that we are now, continue to develop our sort of environmental offer to the market.

Here we were able to produce a coating using sort of what we called a rapeseed oil, which is quite unique, and it makes it very very bio, very much environmentally friendly, which is also an area we are continuously working on. Very pleased about that.

There has been a lot of talks about the tariffs and the turbulence we have related to it. It creates a lot of uncertainties on the markets, of course.

Once again, I just want to highlight that we have a significant production in the United States, and we have significant production in Europe, and that makes us less vulnerable to these kind of initiatives. I also want to point out that CBAM was implemented in Europe from the 1st of January.

That will have a positive impact. It increases prices, but also it will change some of the trade flows, because it will be difficult for some of the countries to actually export to Europe.

Then again, we also have on the table of the European Parliament to decide on the safeguards, and that will also what we believe have a positive impact on the European market. I also want to highlight the the transformation projects that we have ongoing.

What you see on the picture to the right is the transformation project in Oxelösund. Here we are replacing old blast furnaces with a new electric arc furnace, and the building you see to the right is actually the electric arc furnace building.

It is developing really well. I think that it's we have done a good job when it comes to project completion, and we have planned a production start-up in the in the beginning of 2027.

Then if you look at the Luleå project, which is a larger project, it is also a way for us to reposition SSAB Europe to produce and sell more of the unique premium steel grades, primarily for the automotive industry. We have done the groundbreaking ceremony.

We got the environmental permit. We also continue with agreements with both customers as well as suppliers.

One thing I want to point out is the sort of the the agreement to get our hands on high-quality scrap, and one of the things that we signed during 2025 is the Volvo Car agreement, which is also seen as a a highlight for both parties, for them more the circularity, but for us, it's more getting our hands on on the premium scrap material. Then going into the divisions, looking at Special Steels, we believe that the shipments, even though they were somewhat lower in Q3, then again, we had a very extensive maintenance outage during Q4 in Special Steels that had a big impact on on our ability to ship out material, but still, I think that we delivered on a higher level than we did Q4 last year, when we have the same situation.

Special Steels can also see some improvements in the activities in on the European market, and I think that's quite positive. A market has been quite on the low side for quite some time, and now gradually we see some positive signals on sort of the European market, and that has been, identified by by Special Steels particularly.

Of course, we have an increasing demand for protection steel because of the market situation. The operating result came in on expected level.

Then again, if you have a maintenance outage, it comes with a cost, and it comes also with higher unabsorption. We this was expected, nothing strange.

We also have to say that prices went down a little bit, but we also have some exchange exchange rate effects on that. Leena will get back to that in her presentation.

Then if we move into SSAB Europe, I think that, first of all, they they the market for SSAB Europe is weaker. They are more sensitive to the spot market and the hot rolled coil prices than than other divisions.

Despite that, I think that they delivered above our expectations when it comes to shipments, and they had higher shipments in Q4 compared to Q3. We were a little bit concerned about their operating result, but they did a lot of measures, first of all, cost-saving measures, but they also improved the capacity utilization, hence giving us, a better performance than we expected.

Looking at SSAB Americas, I think that also they came in We had a maintenance period as well as as American SSAB Americas, and normally the sort of the shipments goes down, but I think that they had a great achievement, especially in December, shipping out a lot of material. They've had a strong order intake, and hence they were able to sort of fulfill the demand and and ship out as much as they could.

A great achievement by the whole team in Q4. They ended up now on a on expected result level.

I think that they have been suffering from a weaker weaker US dollar if we translate this into Swedish kronor. Otherwise, the outcome would have would have been much much better.

Then for our two subsidiaries supporting the business plan for SSAB Europe, we can believe we can see that the shipments for Tibnor were slightly higher than Q3, but still it's a it's still a very weak market, and we also have a very strong seasonality in Tibnor, just like we do in Ruukki Construction. Of course, the operating result came came out on a on a lower end.

We were expecting the volumes to be higher, hence it has a negative impact on the result, and that's exactly the same situation for for Ruukki Construction, where where both the volumes and the volume the lower volumes has a big impact on the operating result, and that's mainly due to the weak market conditions. We have high hopes for 2026, where we hope that the and think that the construction segment is going to improve.

Once again, I want to highlight our strategic direction and also the uniqueness of our grades. This is an application, not a big application, but it shows that our grades are unique.

This this application is for a power booster to charge cars, and if you are on a sort of remote side, on the countryside, where where the sort of power lines are maybe not as strong, you're not able to actually charge the car very very fast. With this power booster, you can actually gradually use the power to transform it into kinetic energy, you have a rotating part inside of this container, and it rotates extremely fast.

With these loads and with this velocity, you need material that has a very good fatigue strength, and that's exactly what our material can offer. Hence, the reason why they choose our material.

I think, in this case, it was pretty much the only material that they could use, otherwise they would have fatigue cracks very very very fast. It but it shows that we are selling into unique applications, but also that our products are unique and creates a lot of unique customer value.

With that, I leave the word over to you, Leena.

Thank you, Leena. From the fascinating product description to fascinating financials.

Let us start by looking at the shipment volumes first. Q4 performance was 1,515 kilotons, and it was actually improvement compared to Q3, as also illustrated by Johnny already.

The improvement was 49 kilotons and 3%. Then comparing to previous year Q4, improvement was even further, 67 kilotons and 5%.

If we reflect against the guidance we gave for Q4, we were actually spot-on with Special Steels and Europe division and even slightly better in SSAB Americas. If we then continue to analyze the revenues, the Q4 revenue performance, 22.1 billion, compared to previous quarter, a reduction of 4%, and compared to previous year Q4, reduction was 6%, and this is indicating that the prices have developed downwards, and I will dive into that more in detail shortly.

EBITDA performance Q4, 1.8 billion, a reduction compared to Q3, which was at 2.9, however, improvement compared to previous year Q4, which was 1.6. In relative terms, this means that the Q4 '25 was 8% improvement compared to previous year level of 7%.

Let us walk through the analysis related to operating result, and this is now comparing Q4 with the previous quarter. Q4 operating result, 756 million, compared to 1.9 billion during previous quarter.

Here illustrated in the graph, we have a negative impact with the price development. On average, prices were 3% lower, and the biggest contribution here coming through Europe division, which just over half a billion negative impact, followed by Americas, 240, and Special Steels, 165.

Tibnor prices were flat, and Ruukki Construction prices slightly lower. As already Johnny mentioned, here we also have a slight impact with the FX and also with the product mix, but that's illustrating rather the seasonality during Q4.

Volumes were 3% higher, and a positive impact, a net 115 million SEK. Europe division, 41 kilotons higher, Americas, 10, and Special Steels volumes were flat quarter-on-quarter.

Variable cost positive impact. Raw material costs were lower.

However, we have offsetting effect here with the maintenance outage cost. Also maintenance outage cost impacting the fixed cost, but to remind that these are also seasonally higher during Q4 compared to previous quarter, which was the vacation period, and also to highlight that yes, we did have saving actions both in Q4 and Q3, perhaps the year-over-year is illustrating better the savings performance.

Here the net effect is 570 million SEK negative impact on EBIT. During Q4, the production activity was higher, and thus the positive impact related to capacity utilization.

This is mainly now related to the Europe division rolling performance. Maybe to remind that during Q3, the maintenance outages were in Raahe, Borlänge, and Luleå, and during Q4, the maintenance took place in Oxelösund, Mobile, and Hämeenlinna, and the cost of the maintenance was quite much higher during the fourth quarter.

Similar comparison, but now year-over-year, Q4 performance '25 over Q4 '24. Performance Q4 '24 was 487 million, and the only negative impact coming through with the prices, while all the other elements having a positive impact.

Prices were 8% lower. Europe division, Special Steels division both contributing over 600 million negative impact, while Americas had a positive impact.

As already mentioned, the FX did have a big, significant negative impact in prices. Total FX impact in this analysis is 840 negative, which, on the other hand, is having a positive impact in the variable cost side, but on a lower level.

Volumes, already mentioned, 5% higher, and here the biggest contribution coming through Special Steels division, 17 kilotons higher volumes, followed by Europe division, 28 kilotons, and Americas, 12 kilotons. All steel divisions performed better year-over-year.

Variable cost positive, 345. Raw material costs were lower, but this partially offset by the maintenance cost, and this year it was slightly higher than the previous year.

Already mentioned the saving actions, and here illustrated well that the fixed cost year-over-year were lower, 430 million. We had the time banks in use and a lot of saving actions throughout the organization, and the outcome illustrated here in this graph.

Production activity was higher, and a positive impact with the capacity utilization, and the re-evaluated balance sheet items also just below 70 million positive impact. Cash flow, if we firstly look at the quarterly performance over previous year Q4, EBITDA, as already described, slightly higher than last year.

Very similar trend when it comes to working capital, a positive impact during both years. Here to remind that we have the seasonal impact.

We have winter stocking taking place during Q4, rather large raw material invoices posted to Q4, which will be paid out in Q1, which will then lead that Q1 will be seasonally negative impact. R&C CapEx, maintenance CapEx slightly higher, but well in line with our guidance, just below 3 billion the full year.

The other line here is related to the CO2 emission allowance transactions. During Q4, it was a positive.

Financial items here, as you can see, during this year, we do have the cost related to Luleå financing, the prepayments and premiums being paid out. This has a cash flow negative impact.

However, we are activating these to the balance sheet, not the same effect in the P&L. Of course, also the cash position is slightly lower compared to previous year, and to remind that the interest rates has also developed lower when it comes to interest rate on cash.

Strategic investments are significantly higher, and here, of course, the driver being the Luleå investment project. On full-year level, to remind that the dividend was during '25 lower, and '25 Q1 we still had the share buyback program ongoing, which we didn't have during '25.

This leads to net cash position 11.6 billion at the end of '25, and this is still very well in line with our financial target when it comes to net debt-equity ratio, plus-minus 20%, as the outcome is minus 17%. If we do a short bridge over previous year end cash position versus the outcome this year, we start from the 17.8 billion, and then we add the cash flow from current operation, 6.5 billion, and then we subtract the strategic investments, 7.2 billion, the dividend 2.6 billion, then we need to take into account the revaluation of US dollar-related items.

As Johnny already mentioned, the Swedish crown has developed during '25 around 20% stronger versus US dollar, so that does have an impact in the net cash position as well. The proposed dividend is 2 crowns per share, and that will be proposed to the AGM and then paid out in Q2 '26.

Market prices have been develop slightly downwards during second half of '25, and that is also illustrated in our savings in variable cost. We don't foresee that the prices would develop upwards, rather remain stable and our consumption cost as well, or slightly even downwards.

When it comes to iron ore, to remind that the lag in the cost impact is one quarter, and with coking coal, it is slightly longer, it is 1 and 1/2 quarter. It's a bit different view with the scrap prices.

They have remained flat during the second half, but have started to increase towards the end of '25, and we have seen that they have continued to increase, they will have an impact in the margins for the Q1. Maintenance cost, this table is illustrating the plan for '26.

The outcome '25 was 1 billion 410 million, and on a similar level planned to be for '26. The difference with the '25 and '26 is the schedule when it comes to US mills.

During '25, we were maintaining Mobile mill, while during '26, the plan is to maintain Montpelier mill. Thus, a bit different spread over the quarters 3 and 4, but on very similar level.

Then CapEx guidance. This we have already presented during our Capital Market Day.

The performance during '25 was just above 10 billion. That was well in line what we have been guiding for this year.

Strategic CapEx landing on a level of 7.2 and maintenance just below 3. Plan is to have similar maintenance CapEx for '26, however, increase the strategic CapEx, which will be 10.5 billion for '26.

If I split this 10.5 to major strategic projects, just below 3 belongs to Oxelösund, around 6 to Luleå, and just below 2 to other strategic projects. Also refer to the emission allowance plans for '26.

Our estimate is that the cash flow impact will be very similar during '26 as it was during '25. The impact during '25 was this 724 million, and around 740, we have estimated to be the impact on '26.

We also want to point out that we have started our digital renewal project to modernize our IT landscape. Of course, this is needed, and also this is supporting the strategic investments, especially Luleå minimill investment.

We started during '25 do the design phase for these digital projects, and now we are progressing with the build phase, and these projects will be followed under the other division, and they will be posted as operating cost. We cannot capitalize all of it.

Our estimate is that on annual level, the increase in the operating cost when it comes to other division is around 200 million SEK. This is the annual estimated impact of this projects.

With this, I give it back to Johnny.

Thank you very much, Leena. I will try to give you a short outlook for 2026, and I will start by going through the customer segments.

I think besides this, I think the largest impact on the European steel industry is going to be the safeguards decision done by European Parliament, as well as, of course, the CBAM, which is already implemented. Besides that, I think for SSAB, we believe that the heavy transport segment is going to sort of remain neutral for us.

We believe that there is some strong upsides in the shipbuilding, not only here in Europe, but also in the United States. That is clearly a sign, but also we see the rail transport in the United States is stable, or maybe a little bit stronger than stable, that's what we see.

Then we have the automotive segment. We know that our advanced high-strength steel sales are increasing, and now when we might need to move some of the sales that we do shipping material from Europe to the United States that might be moved to European customers as well, since we have a limited capacity, we will be able to sell this to European customers.

I'm not so concerned about that because there is an interest for advanced high-strength steel where they are able to make the cars much lighter, there is a sort of a demand for it. Of course, the sort of the red part of it is the uncertainty regarding the tariffs and the turbulence related to the United States and the timing here.

Then we have the construction machinery. We see some improvements in North America.

It's been also very turbulent, and production being moved from Mexico to the United States, and so on. A lot of our customers are a little bit confused, but it's stabilizing right now, and we see sort of an increased demand, and that's also helping us.

I think material handling, which is mainly related to mining, that is a very strong segment, has been strong for quite some time. It is a very important segment for us and also especially for Special Steels, where I think that maybe more than 50% of their sales is related to sort of mining in some one way or another.

It's upgoing. With the gold prices, the silver prices, rare earth metal prices going up, new mines are being opened up everywhere.

Even though it says neutral here, I think it's on a higher level. Then we have the energy segment, where we see a strong demand, especially in the United States.

We see we've never had as much pipe orders as we have right now, mainly related to oil and gas, but we also have energy transmission, which is also very very strong, and here in Europe we have sort of the renewables, wind power, et cetera. The construction segment is on the lower side.

We are carefully thinking that the segment will improve second half of 2026, but right now it's rather low activity. Then the service centers.

They have a low inventory level in the United States. It's likely that they will be restocking, which is the seasonality that we see, the pattern that we see.

To some extent, inventory levels in Europe are somewhat high. I think that a lot of service centers took the opportunity to buy some extra material before the CBAM and potentially also the safeguards.

Of course, those inventories will not last forever. What we're guiding for Q1 2026, and here we have a very strong seasonality, we're quite confident when we look at the shipments.

Same pattern as last year, that the shipments will be significantly higher for Special Steels. It will be higher for SSAB Europe, and then somewhat higher for Americas.

Prices remain stable for Special Steels, but we expect the prices to somewhat increase in Europe for Q1, and then the same thing in Americas. Remember that there are some lead times to order intake price and then when we actually get the invoiced price increase.

Then to conclude, we have a weak market situation. We had for some time, but we are mitigating it with our strategy, where a very clear strategy to develop and sell more premium strategy, more focusing on generating unique customer value.

We also have a geographic diversification that supports us when there are tariffs, let's say, in the United States, and we have done cost measures that resulted in a positive outcome. We've had a strong focus on safety, and that also given results.

We had stable earnings, especially in SSAB Special Steels, that continue to develop even if the market is, sort of, tough. Our strategic investments are according to plan.

Then last but not least, the board are proposing a dividend level of 2 Swedish krona per share. With that, that's my conclusion, my summary, Per, I leave the word over to you.

Thank you, Leena. Thank you, Leena.

We can then prepare for the Q&A. We have a extensive queue, I think, I suggest that we limit the first round to two questions per persons, and then you can come back later on in case there is anything outstanding.

If you have more than one question, please state them one at a time. By that, operator, please present the instructions for the Q&A.

Hi, thank you. First, maybe on your price guidance for Americas.

It was somewhat higher for Q1 despite sort of a significant currency headwinds, given that the dollar continued to weaken this quarter. Can you just clarify, is that based on USD spot prices, meaning does it exclude translation effects?

In the price guidance, we don't speculate with the FX impact, we are discussing in that aspect only the underlying pricing activities. No speculation on FX.

Thank you. That's clear.

On Nucor's call yesterday, they sort of mentioned EAF ramp-up costs totaling around $500 million for '25. I know that's across a few projects, but can you give us any sort of indication of what that figure could look like for Oxelösund?

You mean a specific cost for the ramp-up phase? Is that what you Yes.

refer to? We've been talking about a little bit double manning, but we haven't specified.

We have a clear plan. We know exactly what the costs are going to be, but that's not something that we go out with public.

It's a part of our sort of cost structure, where we will have some double manning, where we run the blast furnace as well as electric arc furnace for a period of time. We have a clear plan for it, and we also know exactly the impact of it, and that was taken into account when we did the budget for 2026.

We haven't really published any numbers related to it, and we prefer not to do it either,

so. That was two questions.

I'll get back in line. Thank you.

Mm.

Yes, hello. Just starting off with a follow-up question on the Oxelösund transition.

Not so much on the cost, but rather the timeline. How long do you expect for it to take to ramp up the electric arc, and how long do you plan to run the two furnaces in parallel?

No, I think the difference between other projects is that we're only replacing sort of the melting part, the primary part of the production. It's the replacing the blast furnace with electric arc furnace.

Hence, the other processes doesn't need to be qualified. As long as the chemistry is right, the qualification period is going to go pretty fast.

Can I say how much time we're planning for, or is that something we can

We can indicate in the reports.

The plan we have is 6 months for the total qualification of the new grades. For the grades that we are producing in Oxelösund, there are not a strict customer qualifications.

It's more what we can promise to the market, it is easier than it normally is to other sort of segments and applications, so. Hence, the reason why we're very confident on the timeframe here.

Understood. That's helpful.

Then another one, more short-term on the Q1 guidance for Europe, where you guide for 0% to 5% higher prices. Just looking at the market indices and factoring in your typical lag effects, it doesn't seem like you're realizing the full uptake on the market price at least in your guidance.

Can you say a few words about why that's the case?

I think what you said as well, it's just the delay and the lag. Normally, when we enter Q1, most of the orders has already been planned for.

We have already agreed with the customers. We have a lot of quarterly pricing, and so on.

Hence, the reason that the effect will be postponed. We will rather see a bigger impact in Q2.

As Johnny mentioned, we have this quarterly contracts and annual contracts, those are not priced according to spot pricing. Not the full spot price development can be impacting the Europe division.

Okay. In that case, that's all for me,

Yes, good morning, and thank you for taking my questions. Back to the Q1 guidance, Johnny, the Special Steel pricing, you're talking about flat Q-on-Q, I guess which reflects also the weakened markets that you've touched on.

Can you give a bit more color on why prices are not following the upward trends in European HRC? Is that a mix effect as we head into Q1?

That's my first question.

I think for the Special Steel pricing, it doesn't really follow the hot rolled coil pattern at all. It's more related to what kind of segments they're planning to sell to, and what kind of geographies they're planning to sell to.

Special Steel is different compared to the other two divisions because they have global sales, and active in a lot more segments. I think that the indications that were given now for Q1 is because we believe that we will be selling in sort of other geographies that we know that the average prices have been somewhat lower.

That gives you some explanation. We believe that we do have some potential to increase prices both in Europe and also United States going forward.

For Q1, we pretty much know what's going to happen,

so. Thank you.

Then my second question is on the Oxelösund start-up as well. I think the wording in your statement is heavily caveating the power connection and the appeal process.

Should we interpret this as suggesting that you are less confident about the start-up date as compared to last quarter, for example?

No, first of all, I would just want to address that the project is following and developing according to our time plan, and we're doing a great job with that. We are dependent on getting the power to the site.

We're depending on the company erecting this power line, which is 72 km long. We can only listen to what that company tells us, and they tell us that it's according to plan, and that's all we know for the time being.

We know also that there has been some appeals for some of the permits, and that's also what we included in the report. The consequences and the effect of that, we cannot really assess at this point.

We thought it was vital information, we added it into our report.

Thank you. That's very clear.

Thank you.

Morning, Johnny and team. Thanks for taking my question.

I just want to go back to your comments around inventories. You mentioned that inventories are somewhat higher.

Can you just give us any details around which specific grades and products you're seeing those elevated inventories in? Then can we also just get a read on what you're seeing in January so far, and whether the inventory build you think has been more CBAM-related or is this maybe some kind of demand anticipation?

Our interpretation at least is that it's probably more CBAM-related, especially in some areas and from some geographies. We can see that there was a massive pick-up of inventory.

One of the areas I want to point out is the color-coated. We saw a significant amount of color-coated material coming in from especially Korea to Europe because they knew that the CBAM would have a negative impact on the prices, and so on.

That's just one example, but we could also see that on hot rolled coil to some extent, cold rolled coil as well, especially in Italy for some of the countries delivering, where they were a little bit concerned about what's around the corner. I guess that's all I can go into right now when it comes to details, otherwise, it's going to be take too much time.

Then, like I said, the inventory will not last forever, this is probably a quarterly effect or a quarterly consequence.

That's fair. Thank you.

Can I just check on construction? You mentioned a neutral outlook.

We have seen some of the leading indicators in the construction industry pick up and, in some cases, quite sharply. Is the neutral 1Q outlook just because of some lag, some delays in that activity coming through?

Can you maybe just give us any sort of read on at least where you see the trajectory of construction activity, maybe as the year goes on?

No, especially for Q1, we have a hard time to see that there's going to be any great improvements for Q1. However, with the German infrastructure project and so on, there are a lot of things ongoing.

There are a lot of things around the corner, and things are about to pick up. When I speak to the CEOs of big construction companies here in Sweden, they are more pointing at that it's very likely that things will start to happen more the second half of this year.

That is also what we are sort of hoping for or seeing as well when we're assessing the market. For the time being, we don't think there's going to be any pick-up in Q1 at least, that's our take on it.

That's very helpful. Thank you so much.

Thanks very much for taking my questions. Both on the US.

The first one just on your raw material cost guidance, and I guess you've guided 0% to 5% higher raw material costs, but we've seen scrap sort of add $50, $60 year-to-date basically. Is that 0% to 5% higher raw material costs already baking in spot scrap prices, or was that set maybe a little bit earlier because I would have seen scrap up at least 10% already?

Yes, sorry, Tom. When it comes to the percentages, that refers to the prices.

When it comes to raw material, our commentary is a bit more loose, and it's not related to these percentages. Just to start there, it can be a little bit deviation from what you see on the price guidance, which is much more stricter.

Okay. Okay.

Still, you're saying costs of raw materials are expected to be somewhat higher compared to prior quarter, and spot scrap is up 13%. I guess my question is, is somewhat higher raw material costs in Americas consistent with what you're seeing in spot scrap markets?

For the quarter, I would say yes. What we do is we look at reports and make a lot of assumptions based on those reports.

Then we have the seasonality. Typically, the scrap prices in United States goes down in Q4 and then it goes up again with the demand in Q1.

The scrap market is very supply and demand sensitive like most of the business in the United States. The demand is now increasing, hence the reason why the prices are going up.

Fair enough. Then just on US pricing and plate pricing.

You flagged a bit of demand now coming back in energy. You flagged low inventories in the US, I guess imports have started to come off in Q4.

The pricing dynamics that we've seen, I guess, kind of makes sense, plate prices coming up. Then it looks like it's mostly just been offsetting these higher scrap prices so far.

Do you see the room for actual plate spread expansion through the next couple quarters? How quickly do you think that can come?

Would you think demand is still just a bit too muted? Thanks.

We have room to increase the spread. I think that when we announced our price increases, we were not aware that the scrap prices are going to go up as they did, I think that we're going to work on pricing going forward.

I think there are room for us to sort of increase our spread. That's what we think at least.

Understood. Thank you.

I'll turn it back.

Thank you, and thank you for the presentation. I just wanted to ask you about Special Steels.

In the Q3 guidance, you indicated that both prices and raw material costs would be somewhat lower, but given that volumes were relatively flat in Q4, margins still declined. Could you please elaborate a little bit around the drivers behind this, and what we should expect going forward?

I think Special Steels is probably the division has the longest sort of lag between purchase price and consumption price. It's extremely long.

It's maybe sometimes it's 6 months, 7 months before we buy raw material and then the consumption price. When we do this kind of guidance, it's looking at sort of the purchase price compared to.

I guess that's where it gets a little bit confusing, but that's really what it's related to.

Thank you. The other question is with regards to the CBAM.

Have there been any impact on volumes, or would you say that import levels remain broadly unchanged compared to before? No,

I think import levels now in the beginning at least have slightly been reduced. There's a lot of confusion on how to do it and also if you're qualified and get also the approval for sort of importing into Europe.

Hence, the reason why the import level has reduced somewhat. Eventually, of course, importers will learn and they will understand how it's done.

We also strongly believe that the import supply chains will change significantly, and there will be some countries that will go down to almost nothing. It's very very likely.

There will be a time now where supply flows will change, also some time for importers to understand how it's done and also how do you pay for it at the end, when do you buy the certificates. A lot of confusion right now, and that's, I guess, beneficial for the European steel producers.

Thank you. That was it.

Yes, hello. Thank you for taking my questions.

Firstly, I wanted to ask just high-level on EU safeguards. If we see the sort of reduction in the magnitude that might be expected, could you share anything in terms of what market share gains you expect to have versus competitors, and also how quickly you can adjust production to sort of capture these volumes?

No,

first of all, SSAB's utilization level has always been quite high. I think European utilization in general has been rather low.

I think it is communicated to be around 60% to 65%. We are way much higher than that, which means that if, let's say, that this decision is made and the safeguards are in place, of course, we will be able to ramp up a little bit, but we already have a high utilization level.

I think the big impact will be the price changes and the supply and demand change. There will be a period of time where the demand will be high, and the supply will be limited because during the last 2, 3 years, blast furnaces has been closed down, capacity has been closed, hence there's going to be a gap between supply and demand in the beginning, and hence the reason why we believe that there's going to have an impact on prices.

That's, of course, is going to be very beneficial for SSAB. I think did I cover all your questions there, or your question?

You did. Thank you.

In the US, Section 232 tariffs, could you share anything on your sort of long-term plan for Docol AHSS exports to US automotive? Will you continue sharing costs with customers, requalify with European OEMs, develop domestic US capacity?

Anything there would be interesting.

We're looking at all of those options, of course. When it comes to this continuous annealing line in Borlänge that we have where we can actually produce these unique products, it has been pretty much fully utilized for the last 4, 5 years.

We have decided to sell this capacity into United States or some of this capacity into the United States because the margins have been higher. It's not like we have to.

There is a demand for it also in Europe. There's a list of potential customers that we are now talking to, and we also been qualified to supply to them.

When there is a sort of lower demand from United States, we will shift it over to supply to European customers instead, and that is sort of in the making as we speak. Then, of course, there is still a demand for our products, and we don't really understand where they're going to get these products from, because you cannot produce it locally.

They either have to downgrade or, I don't know, some other solution. We are, of course, looking at all options, but the volumes are not big enough to do any large initiatives, especially if we can sell this capacity to someone else, then yeah, we're looking into all options and see what we're going to do on that.

Okay. Perfect.

Thank you very much for taking my questions.

Good morning. Thanks for taking my question.

Just two on my side. The first one is on the order books for your plate business in the Americas.

We had Nucor talking about a substantial improvement in their order books. I'd just love comments around what are you actually seeing in your order books there?

Then secondly, it's just a follow-up on how do you think the wider industry is going to adapt to the import quotas? You've been quite clear that you've got higher operating rates versus the industry, and you're going to benefit from the pricing.

If we're going to need an incremental 10 million tons of domestic European production to displace imports over time, where do you think those 10 million tons of production is going to come from? Is Europe in a position where we can ramp up the volumes to meet that need?

Thank you.

If we go back 10 years ago, for sure we had that capacity in Europe, and then some of the factories and some of the blast furnaces have been idled. I honestly don't know if they can be restarted again.

It's likely they could, but I'm thinking that there will be a delay, there will be a gap. It's going to be hard to fill, that you still need to import some volumes into Europe.

I'm not so sure that we will be able to ever fill the full gap because of the time that we've had with limited prices or margins to support sort of some of the production in Europe that we have had. To answer that question.

I think your first question was related to US order book. US order book.

Okay. For SSAB, and maybe I'm revealing something that wasn't in the quarterly report, but we have been fully utilized in United States in our two factories, and our utilization levels are extremely high.

Of course, we are continuously working with operation excellence. We're working with AI to optimize our output, and we have been quite successful during last year, enormously successful, I have to say, to get more material out from the factory that we are using.

I think the difference between us and Nucor is that they have a new factory where they have sort of a lower utilization. For them, this will sort of make a difference.

I think again, back to what I said about Europe, I think what is the main driver for us is the price increase that we will see around the corner.

Thank you.

Hello. First question is on cold weather conditions in the US.

I was wondering what kind of impact it could have on your shipments and your scrap procurement in Q1, if all of that was already incorporated in your guidance.

No, I think that we learned a little bit last year, where we had some impact from extreme weather that had an impact on transport of scrap to Montpelier. The consequence was only for a few days, but since we have sort of this lean concept and try to keep the inventory levels as low as possible, I think we learned from that and we built up a slabbing inventory that was much much much higher than usually is, and that was a safeguard, just to be on the safe side just in case something happened.

To answer your question, we are more prepared for it this year than we were sort of last year.

Fair. Second question is on the defense business.

If we take stock of 2025, how are volumes compared to 2024? Are you perhaps going to increase transparency on volumes the same way as you do on auto for this business because there's a lot of market expectations on this topic?

Just related to your recent Rheinmetall contract, yeah, are you facing any limitations in terms of quality due to the use of green steel? That would be my second question.

We haven't decided yet whether we're going to reveal the volumes and be that transparent on it, and we also need to be a little bit cautious because we don't want to say to potential terrorists or whatever where we produce and how much we produce, it might have a negative impact. However, we know that companies like Rheinmetall, KNDS, we also have Patria in Finland and Hägglunds in Sweden, they have tripled their capacity just to be able to supply what the market needs, and even if they've done that, they still have a very long lead times.

This will have a positive impact on us going forward, but the delay and the lag here is much longer than you might think. It takes years until we actually start supplying to these kind of projects because they want to secure that they have cabling, semiconductors, computers, all of that before they start ordering the steel plates.

I think they've had some challenges in the past. I think it's been resolved a little bit right now, but if you ask me in 2 years, the situation is going to look much much better when it comes to deliveries and a major increase, I guess, in protection steel compared to now.

Even though it's better than 2024, we believe it's going to be much better in a couple of years.

Thank you.

Operator, just reminding of the time. We have time for one more question.

Good morning, all, and thanks for squeezing me in and take my questions. Just maybe a quick one on Specialties, just from the demand you see and the customer conversations you have, would you be confident enough to say that 2026 will be the year when you will get back on the growth track you are aiming for the business, or is it just too early to say?

That would be my first question.

No, I've learned after Russia attacking Ukraine and after the pandemic and after the tariffs, I've learned that it's really really hard to predict what's going to happen in the future. If there aren't any geopolitical issues or topics, then I'm very optimistic that we will have a growth.

This growth can come fast. It's just a stability on the markets, then the growth will come fast.

Great. Thanks for that, Johnny.

Then one more question on the FX side, where we've seen a significant volatility, and maybe one for Leena, but from the presentation, it seems like we have not seen much of the FX in your results yet, but from the sensitivities you provide, I guess this could be more than a 1 billion impact given that it's mostly a dollar market, and there would obviously be some impact from translation. Could you please help us to understand how far you are hedged short-term and how we shall expect the FX to flow through your numbers?

Maybe also, can you help us to understand how your commercial approach works, particularly in the business like the Specialty Steels business, where you're obviously doing a lot of, I guess, overseas business? Which percentage of your invoicing here is actually in dollars and euros versus kronas?

That would be very helpful. Thank you.

I don't have the percentage to give you, but you're absolutely right that Special Steels sales currencies are sort of in US dollars, euros, and also other exotic currencies, and we do hedge the net cash position with accounts payable and receivable, we are hedging. We don't do, for example, equity hedging.

As already mentioned, the benefit with the prices or the negative impact of FX in prices is, to some extent, then offset by the positive or negative impact in raw materials, because we are purchasing significant amount of raw materials in US dollars. The combination of all this then is sort of the hedging policy that we have.

What is roughly the duration in these hedges? Is this 6 months, is it a 12-month rolling, or No, we do it on ongoing basis.

How long,

for example, we have that, obviously, roughly an 8% move in the currency in the course of the fourth quarter, how long would it typically take then until we see this coming through via the translation effect?

I don't have that kind of answer to give.

I think what Leena also said in her statement is that I think the biggest impact comes from the natural hedging, which is that we purchase so much in US dollar. We purchase in US dollar for the European production, if you talk about iron ore or coal or whatever it is, all of that is purchased in US dollar.

Then for Europe, we're selling in euro, we have a very strong natural hedging.

Yes. Yeah.

The fact that you're guiding for stable input factor prices are I guess dollarized, in SEK terms for iron ore and coal, obviously, has been down 16% to 24%. Are you fully hedging the raw materials as well?

No.

You're not.

No. We have very small portion of commodity hedging, but that's very very limited, I wouldn't even mention it.

A hedging comes at a cost as well,

so. Then why are you guiding for flat costs in Q1?

Because most of it we have already purchased, and agreed on.

Yes. It is the consumption cost that we have, or the inventory.

Exactly, Bastian, it's the estimated consumption cost. You can say slab cost now looking into Q1.

Mm.

All right, sounds good. Thanks so much for the help.

Thank you. That concludes then today's conference.

Thank you, Johnny. Thank you, Leena.

Thank you, the participants, and we wish you a nice day.