Steel maker Klöckner & Co (KCO) Wednesday reported a wider loss for the first quarter, amid weak demand, and said achieving full year Earnings Before Interest, Tax, Depreciation and Amortization, or EBITDA target is increasingly unrealistic.
Net loss for the quarter widened to 16 million euros from 12 million euros in the prior-year period. Basic loss per share was 0.16 euros compared with 0.11 euros in the prior-year quarter.
EBITDA dropped 35 percent to 29 million euros, due to shortfall in gross profit, despite a 26 million euros cost reduction.
Turnover dropped 11.4 percent to 1.6 million tons from 1.9 million tons, and sales declined 16.5 percent to 1.6 billion euros, amid weak demand and portfolio streamlining in Europe as well as less working days in Europe and the US and lower price level.
The company said its restructuring program is largely completed following withdrawal from Eastern Europe.
The company expects a slight upturn in demand in the second quarter, based primarily on the seasonal improvement in weather conditions and less on a general recovery in underlying demand.
For the second quarter, the company expects EBITDA between 35 million euros and 45 million euros.
Further, the company said it currently sees no signs of what was originally a widely anticipated pick-up in steel demand in the second half of the year. Thus the full-year guidance for EBITDA of 200 million euros in 2013 is looking increasingly unrealistic, it added.
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