Outokumpu's Annual Accounts 2009 - exceptional ...

PRESS RELEASE
February 3, 2010 at 9.10 am EET


Year 2009 highlights

- Operating loss EUR 438 million, underlying operational result some EUR -340
million
- Delivery volumes down 28%, cost savings totalled EUR 185 million
- Operative cash flow EUR 198 million
- Dividend proposal EUR 0.35 per share (2008: EUR 0.50)

Fourth quarter highlights

- Operating loss EUR 29 million
- Recovery of prices and deliveries



 Group key figures, EUR million           IV/09 IV/08  2009  2008
------------------------------------------------------------------


 Sales                                      728   966 2 611 5 474

 Operating profit                           -29  -271  -438   -63

 Profit before taxes                        -36  -298  -474  -134

 Net profit for the
 period                                      -6  -233  -336  -189

 Earnings per share,
 EUR                                      -0,04 -1,30 -1,86 -1,05

 Net cash generated from operating
 activities 1)                             -108   205   198   664



 Stainless steel deliveries, 1000 tons      277   261 1 030 1 423

 Stainless steel base price, EUR/t 2)     1 297 1 045 1 161 1 185

 Stainless steel transaction price, EUR/t
 3)                                       2 346 2 338 2 036 2 801



 1) Cash flow presented for continuing operations

 2)  CRU: German base price (2mm cold rolled 304 sheet)

 3)  CRU: German transaction price (2mm cold rolled 304 sheet)



2009 was a historically difficult year for the stainless steel producers. The
global recession had a significant impact on the industry, especially in Europe.
During the first part of 2009, demand was extremely weak and markets were
characterized by heavy reduction of inventories in the whole value chain. Some
recovery occurred in the summer but markets softened again towards the end of
the year.

To adjust to the weak demand, Outokumpu implemented heavy production cuts, the
average capacity utilization was very low at about 60% in 2009. Stainless steel
deliveries totalled 1.03 million tons, 28% down from 2008. Average reference
base prices were slightly down but transaction prices, which also include raw
material costs dropped 27%. The average nickel price went down by 31% and the
ferrochrome price by 52%. Due to heavy decline in both volumes and prices,
Outokumpu's sales totalled only EUR 2.6 billion, down 52%.

Outokumpu's cost-saving actions during the year delivered good results with
about EUR 185 million of savings. The negative impact from the historically low
delivery volumes was, however, clearly bigger, resulting in heavy losses for
2009. Operating loss totalled EUR 438 million. The underlying operational
result, which excludes raw material-related inventory losses and non-recurring
costs, was negative at EUR 340 million. In 2008 the operating loss was clearly
smaller at EUR 63 million though heavily burdened by massive raw-material
related inventory losses and higher non-recurring costs. The underlying
operational result was still positive at EUR 305 million in 2008.

In the fourth quarter of 2009, Outokumpu recorded the first profit improvement
compared with the previous year. Operating loss was EUR 29 million compared with
a loss of EUR 271 million in the fourth quarter of 2008. The underlying
operational loss improved to EUR 29 million from the EUR 69 million in the
fourth quarter of 2008. The 2008 underlying loss excludes EUR 185 million of
raw-material related inventory losses. Deliveries were 6% higher at 277 000 tons
but due to poorer product-mix, sales declined to EUR 728 million.

Despite the losses, Outokumpu continued to generate positive cash flow in 2009.
Cash flow from operations totalled EUR 198 million as working capital was
reduced as a result of lower inventory levels and metal prices. The company's
balance sheet remained relatively healthy with gearing at 48%. The Board of
Directors proposes a dividend of EUR 0.35 per share for 2009 (2008: EUR 0.50).

No major improvement in the underlying demand for stainless steel is yet
visible. Steel distributors' cautious buying behaviour continued over the
year-end. During the past few weeks, order intake has however been more
encouraging. Outokumpu's underlying operational result in the first quarter of
2010 is expected to be at the same level or somewhat weaker than in the fourth
quarter of 2009.

CEO Juha Rantanen:

"Year 2009 was a very difficult one for the stainless steel industry. Dramatic
drop of end demand, representing an estimated 26% decline in Europe, had a major
negative impact on Outokumpu. We were successful in reducing our costs, however,
this effort was not sufficient to compensate for the volume decline. In spite of
external uncertainties, we stay firm with our plans. Priorities for 2010 are
clear; restoring profitability, continued safety improvement, strategy
implementation and delivering of the Excellence Programmes. These longer term
initiatives build the foundation for our future results."

This press release is a summary of Outokumpu's official annual accounts bulletin
2009.

For further information, please contact:

Päivi Lindqvist, SVP - Communications and IR
tel. [phone], mobile [phone]
[e-mail]

Ingela Ulfves, VP - Investor Relations and Financial Communications
tel. [phone], mobile [phone]
[e-mail]

Esa Lager, CFO
tel [phone]
[e-mail]

OUTOKUMPU OYJ




Outokumpu is a global leader in stainless steel. Our vision is to be the
undisputed number one in stainless, with success based on operational
excellence. Customers in a wide range of industries use our stainless steel and
services worldwide. Being fully recyclable, maintenance-free, as well as very
strong and durable material, stainless steel is one of the key building blocks
for sustainable future. Outokumpu operates in some 30 countries and employs some
8 000 people. The Group's head office is located in Espoo, Finland. Outokumpu
has been listed on the NASDAQ OMX Helsinki since 1988.
www.outokumpu.com


[HUG#1379822]





    ENG Media release Annual Accounts 2009: 

http://hugin.info/3010/R/1379822/339689.pdf