Spanish steelmaker Acerinox said Tuesday it is optimistic in terms of activity, prices and margins for the fourth quarter after reporting a drop in output and profits in the third quarter.
"The third quarter behaved as we forecast in July, and the reversal of the trend we announced then has occurred too ," the company said.
The company reported melting shop output of 614,600 mt in Q3, down 3% year on year but up 2% from the previous quarter.
Meanwhile, hot-rolled production totaled 542,400 mt in Q3, down 5% year on the year but up 1% on the quarter while cold-rolled production was 426,800 mt, down 1% year on year and down 2% on the quarter.
Output of long products was 54,300 mt, up 1% year on year but down 5% from Q2, Acerinox said.
The company's net profit was Eur7 million ($8 million) in the quarter --its lowest since the loss-making Q1 2016.
In the summer, Acerinox said it expected output and prices to be negatively affected by a fall in the ferrochrome price, but that the stabilization of alloy surcharges from September, allied with stronger demand and reduced inventories might mean a pick-up in the market after the summer.
Indeed, the company said that the situation has normalized in Q4 and that it expects the 2017 financial year to "end with results which reflect the recovery of the market and improved margins." In terms of production, the company officially opened its new manufacturing lines at its North American Stainless plant in Kentucky earlier this week.
The new bright annealing line and the new cold-rolling mill will enable the plant to increase its production capacity by 10% and expand the range of products, Acerinox said.
The increase should push overall production at the plant to more than 1.5 million mt per year.
Bernardo Velazquez, CEO of the Group said Sunday, that the new lines would "create products of higher added value, increase the steelworks and hot rolling capacity and improve competitiveness of the plant."
