Bloomberg reported that Outokumpu Oyj the Finnish maker of stainless steel, fell the most in 10 months in Helsinki trading after scaling back forecasts that profit will improve.
The stock declined as much as 11%, the biggest intraday slump since September 24. The Espoo based company said underlying earnings before interest and taxes would weaken in the third quarter from the three months ended June, after earlier this year predicting an improvement in the second half.
Outokumpu completed a EUR 2.7 billion (USD 3.6 billion) purchase of ThyssenKrupp AG’s Inoxum stainless-steel unit in December. Waning demand from Europe’s automakers and construction companies has eroded margins, and Outokumpu said in April it plans to cut as many as 2,500 jobs by 2017.
Mr Mika Seitovirta CEO said that “We are only six months into operations of new Outokumpu and the headwinds of the market are not making it easier to execute the transformation of the company. Our ongoing strategic restructuring and growth initiatives will bear fruit in the coming 18 months.”
Outokumpu will continue talks with “several interested parties” on selling its steel mill in Terni, Italy. It expects to complete the divestment, required by the European Commission as a condition for approving the Inoxum transaction, during the second half of the year.
