President & CEO Roeland Baan
“In 2019, the European steel industry continued to suffer from the surge of imports and unprecedented price pressure caused by the US steel tariffs. It is evident that the EU needs to implement stronger safeguards and other trade defense measures to ensure a level playing field for all market participants.
In this harsh market environment, we kept our focus on enhancing our operational efficiency and securing our competitiveness. Our ongoing operational excellence efforts delivered a 4% productivity improvement in 2019. Furthermore, we were able to release almost EUR 220 million from net working capital, and most importantly we reduced our net debt to EUR 1,155 million.
I am also very proud of our constantly improving safety performance and organizational health. The latter is now only a notch away from the international top benchmark. Our latest customer survey tells a similar story: 72% of our customers are highly satisfied with our products and services which confirms our leading market position.
Outokumpu’s full-year adjusted EBITDA amounted to EUR 263 million, strongly affected by exceptionally low deliveries across all business areas. In the fourth quarter, profitability was positively impacted by improved raw material efficiency. Deliveries were low mainly due to distributor destocking in the US, high import penetration in Europe and low activity in the global automotive industry. These effects were further exacerbated by low prices in Europe. Given these challenging market conditions, business area Europe delivered a fair result demonstrating the resilience of our business model. In the Americas, underlying performance continued to improve, supported by commercial efforts and better product mix. The investment in ferritics production in Calvert is on track and expected to start production in the fourth quarter of 2020.
The dynamics in the stainless steel market have shifted as a result of trade wars and intensified Asian competition. Furthermore, there is an increased demand for organizations to reduce their carbon footprint and contribute to climate change mitigation. These are key targets also for Outokumpu. The high recycled content of 90% in our stainless steel production, continuous energy efficiency improvements and decreasing CO2 emissions support our position as a frontrunner in sustainable stainless steel manufacturing. We are confident that through pursuing our must-win battles with a highlighted focus on sustainability, customer orientation and efficiency, 2020 will be another year of continuing progress for Outokumpu.”