Interim report for January-March 2010: Demand i...

Rautaruukki Corporation Interim report 22 April 2010 at 9.00


Summary of results for first quarter of 2010 (reference figure for Q1/2009)

  * Consolidated net sales EUR 505 million (506)
  * Consolidated negative operating profit -EUR 36 million (-113)
  * Result before taxes -EUR 44 million (-122)
  * Gearing ratio was 29.6 per cent (7.4)
  * Net cash flow before financing activities -EUR 87 million (30)
  * Return on capital employed (rolling 12 months) -11.5 per cent (14.5)
  * Earnings per share -EUR 0.24 (-0.65)
  * Ruukki keeps its guidance unchanged. The company estimates a 15-20 per cent
    year-on-year growth in net sales in 2010. Profitability is expected to
    improve significantly compared to the previous year and the full-year result
    before income tax is estimated to be positive.



KEY FIGURES
--------------------------------------------------------------------------------
                                                             Q1/10  Q1/09   2009
--------------------------------------------------------------------------------
Net sales, EUR m                                               505    506  1 950

Operating profit, EUR m                                        -36   -113   -323

Operating profit, excluding non-recurring items, EUR m         -36   -113   -306

Operating profit as % of net sales                            -7.2  -22.2  -16.6

Operating profit as % of net sales, excluding non-recurring
items                                                         -7.2  -22.2  -15.7

Result before income tax, EUR m                                -44   -122   -359

Net cash flow before financing activities,
EUR m                                                          -87     30     30

Earnings per share, EUR                                      -0.24  -0.65  -1.98

Return on capital employed (rolling 12
mths), %                                                     -11.5   14.5  -14.2

Gearing ratio, %                                              29.6    7.4   22.3

Personnel, average                                          11 525 13 460 12 664
--------------------------------------------------------------------------------


First quarter of 2010 in brief:

  * Cautious recovery of the global economy continued, but with large regional
    differences in economic development.
  * Due to a severe winter, delivery volumes were low in commercial and
    industrial construction and in residential roofing products. Demand
    continued to be brisk in road and railway construction in the Nordic
    countries.
  * In the engineering business, delivery volumes were much lower year on year.
    Work continued on reorganising operations and it was decided to discontinue
    until further notice operations at the under-performing unit in Norway.
    In the steel business, gradual recovery continued and delivery volumes of
    steel products increased clearly during the first quarter compared to the
    exceptionally weak reference period a year earlier.
  * Order intake during the first quarter was EUR 507 million, which is about
    20 per cent higher year on year.
  * The operational excellence programme, Boost, is progressing faster than
    originally planned.
  * The group's financial position remained strong.



President & CEO Sakari Tamminen comments on the first quarter:
"During the first months of the year, the economy showed signs of recovery in
our main market areas in Europe. However, there was continued caution in
construction investment decisions. This, on top of an exceptionally severe
winter, weakened demand for our commercial and industrial construction solutions
and residential roofing products. On the other hand, we further strengthened our
strong position in Nordic infrastructure construction, net sales of which were
up by around 45 per cent compared to last year.

In the engineering business, demand was at the same level as at the end of
2009, but clearly down compared to the first quarter of last year. We continued
strengthening our cabin business in Central Eastern Europe. Among other things,
we have improved our production network to enable us to deliver fully-assembled
cabins from our plant in Slovakia to customers in Central and Eastern Europe.

In the steel business, demand was brisker than a year earlier. Sales of special
steel products improved more than other product groups. We supported sales of
special steel products by expanding our distribution network in China, Turkey
and Brazil, for example. Selling prices of steel products were clearly lower
year on year and were at about the same level as in the fourth quarter of 2009.
Even though selling prices started to rise towards the end of the report period,
this did not yet have a material impact on net sales in the steel business
during the first quarter.

During the first quarter, we secured new orders totalling over EUR 500 million
and our order intake in March was at its highest since October 2008. Our order
backlog at the end of the report period was about 45 per cent higher than a year
ago.

This year our main focus is on strengthening sales and marketing. The economic
outlook in our main market areas has gradually improved and a number of
indicators point to continued economic recovery in the coming months. Thanks to
actions to improve efficiency, our cost competitiveness is now much better than
in previous years. This year, we will continue actions to further improve our
cost efficiency.

We estimate a 15-20 per cent year-on-year growth in net sales in 2010.
Profitability is expected to improve significantly compared to the previous year
and the full-year result before income tax is estimated to be positive."


For further information, please contact:
Sakari Tamminen, President & CEO, tel. [phone]
Mikko Hietanen, CFO, tel. [phone]


A press conference, in English, for analysts and the media will be held on
Thursday 22 April 2010 at 10.30am at Ruukki, Suolakivenkatu 1, 00810 Helsinki.

A live webcast of the conference and presentation by the company's President &
CEO Sakari Tamminen may be followed online on the company website at
www.ruukki.com/investors <

http://www.ruukki.com/investors> starting at 10.30.
The event can also be attended through a conference call. To attend the
conference call, please call the number below 5-10 minutes before the scheduled
start time:
[phone], password: Rautaruukki

A replay of the webcast can be viewed on the company website from approximately
16:00. An encore replay of the conference call will be available until 27 April
2010 at: [phone], access code: 862840
RautaruukkiCorporation
Anne Pirilä
SVP, Communications and Investor Relations

Rautaruukki supplies metal-based components, systems and integrated systems to
the construction and engineering industries. The company has a wide selection of
metal products and services. Rautaruukki has operations in 27 countries and
employs 11,500 people. Net sales in 2009 totalled EUR 2.0 billion. The company's
share is quoted on NASDAQ OMX Helsinki (Rautaruukki Oyj: RTRKS). The Corporation
uses the marketing name Ruukki.

DISTRIBUTION:
NASDAQ OMX Helsinki
Main media
www.ruukki <

http://www.ruukki/>.


Rautaruukki Corporation Interim report for January-March 2010

Business environment

Cautious recovery of the global economy continued during the early part of the
year. This was supported especially by growing demand in the emerging economies.
However, there were regional differences in recovery and growth was slower in
Europe than in the rest of the world. Economic recovery in Finland has been
slower than in most other European countries because the Finnish economy is
rather dependent on export demand for capital goods. Nevertheless, economic
recovery is being supported against a background of improving economic
development in Finland's main export markets. Consumer confidence has remained
strong and this in particular also indicates a gradual improvement in domestic
demand.

Normalisation of the financial markets continued even though the rapid
indebtedness of certain states triggered, to some extent, renewed uncertainty.
Strong growth in the Asian and other emerging economies supported the recovery
of industrial production. However, abundant unused capacity meant
investment-driven demand continued to be rather sluggish in the private sector.

In construction, a particularly severe winter affected demand in Ruukki's market
areas. This was reflected in both commercial and industrial construction and in
residential construction. The start of new projects was pushed back and the
throughput of projects under way was slowed. Demand for residential roofing
products declined sharply during the winter months. Nordic road and railway
construction continued to be at a good level.

In the engineering industry, the order flows of Ruukki's main customers have
stabilised at a fairly low level compared to previous years. The pick-up in
demand continued in the manufacture of equipment in the mining and forest
industries and cautious positive development was discernible also in demand for
heavy cargo handling equipment. In the wind power industry, the funding
difficulties faced by new wind farm projects have temporarily weakened demand.
Market conditions remained weak in shipbuilding.

In the steel industry, the gradual recovery in demand, beginning in the latter
part of 2009, continued in Europe. In Finland, recovery of domestic demand was
slowed because capital goods account for a large share of overall steel
consumption. During January-March 2010, crude steel production in the EU-27
region remained at the same level as during the last months of 2009, but was 37
per cent higher year on year. Stock levels of steel wholesalers were normal in
relation to sales. Prices of steel products started to rise towards the end of
the first quarter fuelled by speculation about price hikes in the main raw
materials of steel production - iron ore and coal.


Order intake and order backlog

The volume of new orders in the construction business during the report period
was slightly down year on year and fell far short of the level of previous
years. A severe winter impacted particularly on order volumes for residential
roofing products. Order flow in commercial and industrial construction picked up
during the report period, but was still low. As in previous quarters, order flow
in infrastructure construction continued to be good. The order backlog in the
construction business at the end of the report period was somewhat higher than a
year earlier.

Order flow in the engineering business during the report period was lower year
on year, but noticeably better than for the fourth quarter of 2009. New orders
were secured particularly from customers in the mining and forest machine
sectors. Business activity also began to pick up in the transportation equipment
sector, but this was still not clearly reflected in order intake. There were
very few orders from customers in the shipbuilding industry. Likewise, there
were few orders from equipment manufacturers in the energy industry. The order
backlog in the engineering business at the end of the report period was much
lower than a year earlier.

In the steel business, there was a clear increase in order intake during the
report period both year on year and quarter on quarter. The order flow in
special steel products grew and orders from new markets - China, Turkey and
Brazil - showed good development. The order backlog in the steel business at the
end of the report period was more than double that a year earlier.

The group's order intake during the report period was EUR 507 million, which is
about 20 per cent higher year on year and also higher than for the fourth
quarter of 2009. At a monthly level, the order flow in March was at its highest
since October 2008. The group's order backlog at the end of the report period
was about 45 per cent higher than the exceptionally low backlog last year and
more than 20 per cent bigger than at the end of 2009.


First quarter net sales

Unless otherwise stated, the figures in brackets refer to the same period a year
earlier.

Consolidated net sales for the first quarter of 2010 were EUR 505 million (506).

Ruukki Construction's net sales for the first quarter of 2010 were EUR 109
million (132). Ruukki Engineering's net sales were EUR 47 million (125) and net
sales excluding the Mo i Rana unit in Norway, which is to discontinue operations
until further notice, were EUR 42 million (100). Ruukki Metals' net sales were
EUR 348 million (249). The solutions businesses - Ruukki Construction and Ruukki
Engineering - accounted for 31 per cent (51) of consolidated net sales in the
report period.

Finland accounted for 28 per cent (32) of consolidated net sales, the other
Nordic countries for 32 per cent (33) and Central Eastern Europe, Russia and
Ukraine for 14 per cent (15). The rest of Europe accounted for 20 per cent (14)
of consolidated net sales and other countries for 6 per cent (5).

Ruukki Construction's net sales development during the report period was
affected by a particularly severe winter, which weakened demand, among other
things, for residential roofing products. Delivery volumes of these products
remained low especially in Central Eastern Europe and the Baltic states. Weather
conditions pushed back and slowed also new commercial and industrial
construction projects. Caution in investment decisions continued in this
segment. Consequently, demand remained low and net sales were down year on year
in all market areas. Delivery volumes in Russia decreased noticeably less than
in other market areas. In infrastructure construction, net sales were up 45 per
cent year on year on the back of continued brisk activity in Nordic road and
railway construction projects. Ruukki successfully grew its share of Nordic
bridge projects.

Ruukki Engineering's delivery volumes were down clearly compared to the first
quarter of 2009, except for the manufacture of equipment for the mining and
forest industries. Delivery volumes decreased particularly sharply in the
manufacture of equipment for the wind power industry and in shipbuilding.
Selling prices during the report period were noticeably lower than a year
earlier.

The gradual recovery in demand, beginning in the latter part of 2009, in Ruukki
Metals' business continued and there was a clear rise in delivery volumes of
steel products compared to the exceptionally low level a year earlier.
Deliveries to subcontractors in the automotive industry in Sweden were brisker
than to other customer sectors. Sales of special steel products improved
somewhat better than other product groups owing to a slight pick-up in the
activity of key customer industries using special steel products. Expansion of
the distribution network also helped to improve sales of special steel products,
which accounted for 20 per cent (18) of Ruukki Metals' first-quarter net sales.

Prices of steel products were noticeably lower during the report period than a
year earlier and were roughly at the same level as during the fourth quarter of
2009. Even though prices rose to a certain extent towards the end of the first
quarter of 2010, this as yet had no material impact on net sales in the report
period.


First quarter operating profit

Consolidated negative operating profit for the report period was -EUR 36 million
(-113), equating to -7 per cent of net sales (-22).

Ruukki Construction posted a negative operating profit of -EUR 21 million (-13).
Ruukki Engineering's negative operating profit was -EUR 8 million (5) and
operating profit excluding the Mo i Rana unit was -EUR 5 million (9). Ruukki
Metals posted a negative operating profit of -EUR 4 million (-102), which is a
significant improvement year on year.

Ruukki Construction's operating profit was down year on year due to lower sales
volumes and selling prices. Selling prices during the report period remained
mostly at the same level as during the fourth quarter of 2009. Thanks to cost
savings from permanent improvements in operational efficiency and temporary
adjustment measures, operating profit remained at the same level as for the
previous quarter despite a clear fall in net sales.

Ruukki Engineering's operating loss was mainly due to the low capacity
utilisation rate and to small delivery volumes. Also lower selling prices
weakened operating profit year on year.

Ruukki Metals' operating profit improved year on year as a result of higher
delivery volumes, lower raw material prices, cost savings implemented and a high
capacity utilisation rate in steel production. Operating profit for the report
period was below that for the fourth quarter of 2009. Emissions allowances were
sold for EUR 4 million during the first quarter of 2010, compared to EUR 31
million during the fourth quarter of 2009.


First quarter financial items and result

Net finance costs and exchange rate differences relating to finance totalled EUR
8 million (9). Net interest costs totalled EUR 7 million (5).

Group taxes were -EUR 11 million (-32), which includes a decrease of EUR 12
million (31) in deferred tax.

The result for the period was -EUR 33 million (-90).

Earnings per share were -EUR 0.24 (-0.65).


Balance sheet, cash flow and financing

Total assets at 31 March 2010 were EUR 2,527 million (2,941). Equity was EUR
1,422 million (1,658), equating to EUR 10.24 per share (11.94).

The equity ratio at 31 March 2010 was 56.9 per cent (56.7) and the gearing ratio
was 29.6 per cent (7.4). Net interest-bearing financial liabilities at 31 March
2010 were EUR 422 million (122).

Return on equity during the past twelve months was -14.1 per cent (11.3) and
return on capital employed was -11.5 per cent (14.5).

Net cash flow from operating activities during the first quarter of 2010 was
-EUR 55 million (76) and net cash flow before financing activities was -EUR 87
million (30). EUR 19 million was tied up (EUR 114 million freed) in net working
capital during the report period.

At 31 March 2010, the group had liquid assets of EUR 129 million and undrawn
committed revolving credit facilities of EUR 350 million.


Actions to improve operational efficiency and adjust operations

In October 2008, Ruukki initiated its corporate-wide Boost programme, which aims
at operational efficiency and at permanently improving the company's competitive
edge and profitability. Boost aims at an annualised improvement of EUR 150
million in the company's operating profit. The programme has progressed faster
than originally planned and, between inception and the end of March 2010, had an
impact of EUR 97 million on group profitability. The annualised impact of
actions initiated is estimated to be EUR 142 million. Under the original plan,
it was estimated the benefits sought by the programme would be achieved by the
end of 2011. However, it is currently estimated that the programme could
possibly achieve its aim already in the early part of 2011.

The largest single benefits have been achieved from the centralisation of steel
service centre operations in the Nordic countries, improved supply chain
efficiency and from efficiency programmes in the construction business.

During the report period, work continued on improving operational efficiency and
adjusting operations in the construction business in Finland by streamlining the
organisation and operating model and by improving production efficiency at the
plants in Vimpeli, Alajärvi and Peräseinäjoki. Centralising product manufacture
on increasingly larger units continued by transferring steel structure
production at the Holic unit in Slovakia to Ruukki's other units in Central
Eastern Europe. In future, the Holic plant will make cabins for Ruukki's
engineering customers.

The efficiency of engineering business operations was improved during the first
quarter by, among other things, transferring the manufacture of components at
Peräseinäjoki in Finland to Ruukki's other units. In addition, a decision was
made to discontinue until further notice the operations of the Mo i Rana unit in
Norway, which makes shipbuilding profiles and flange profiles for windmill
towers. It is planned to discontinue operations in Mo i Rana by mid-May 2010.


Personnel

The group employed an average of 11,525 persons (13,460) during the first
quarter of 2010. At 31 March 2010, the headcount was 11,476 (13,253), which was
spread as follows: 6,096 in Finland, 901 in the other Nordic countries, 2,057 in
Central Eastern Europe, 2,088 in Russia and other CIS countries, 79 in Western
Europe and 255 in other countries.

Safety measured in terms of accidents per million hours worked was 8 (7), the
same level as during the previous year.


Capital expenditure

Net cash used in investing activities during the first quarter of 2010 was -EUR
32 million (-46).

Capital expenditure on tangible and intangible assets during the report period
was EUR 34 million (40), of which maintenance investments accounted for EUR 18
million (17). Cash inflows from investing activities amounted to EUR 2 million
(3).

Depreciation during the report period was EUR 37 million (35).

Blast furnace 1 at the Raahe Steel Works in Finland will be modernised during
2010. The company is planning to modernise blast furnace 2 in 2011. Blast
furnace modernisation is a necessary maintenance investment. A start was made on
the modernisation of blast furnace 1 in April. In connection with blast furnace
modernisation, the company will switch over to using iron ore pellets instead of
sinter as the sole raw material in the iron-making process. The sinter plant
currently in use will be closed down by the end of 2011. Environmental
investments will also be made in connection with blast furnace modernisation.

The investments planned for 2009-2011 to modernise the blast furnaces and to
change the feedstock base total around EUR 220 million, in addition to which
some EUR 60 million will be spent on environmental investments. EUR 46 million
of the investments were made by the end of 2009. Some EUR 125 million of
investments are expected to be scheduled for 2010 and EUR 110 million for 2011.

Group capital expenditure on tangible and intangible assets in 2010 is expected
to be in the region of EUR 180 million.


Annual General Meeting 2010

Rautaruukki Corporation's Annual General Meeting was held in Helsinki on 23
March 2010.

The Annual General Meeting resolved that a dividend of EUR 0.45 per share be
paid for 2009. The total dividend payout of EUR 62.5 million was paid on 8 April
2010. In addition, the Annual General Meeting resolved to authorise the Board of
Directors to donate a maximum of EUR 900,000 of the company's distributable
capital to support the activities of colleges and universities.

The Annual General Meeting confirmed that the Board of Directors is to have
seven members. Reino Hanhinen, Maarit Aarni-Sirviö, Liisa Leino and Hannu
Ryöppönen were re-elected to the Board. Pertti Korhonen, President & CEO,
Outotec Oyj; Matti Lievonen, President & CEO, Neste Oil Corporation and Jaana
Tuominen, CEO and Managing Director, Paulig Ltd were elected to the Board as new
members. Reino Hanhinen was re-elected as chairman of the Board and Hannu
Ryöppönen was elected as deputy chairman.

The Annual General Meeting resolved to abolish the Supervisory Board and to
amend the company's Articles of Association accordingly. The term of office of
the Supervisory Board elected at the Annual General Meeting ends when the
resolution to abolish the Supervisory Board has been entered in the Trade
Register. The Annual General Meeting confirmed that the Supervisory Board is to
have five members. Marjo Matikainen-Kallström was re-elected chairwoman of the
Supervisory Board and Inkeri Kerola as deputy chairwoman. Turo Bergman, Jouko
Skinnari and Tapani Tölli were also re-elected to the Supervisory Board.

The Annual General Meeting re-appointed KHT audit firm KPMG Oy Ab as the
company's auditor, which appointed KHT Pekka Pajamo to act as the principal
auditor.

The Annual General Meeting resolved to amend Article 11 of the company's
Articles of Association so that notice of the Annual General Meeting must be
given no later than three weeks before the Meeting and at least nine days before
the Annual General Meeting record date as referred to in the Finnish Limited
Liability Companies Act.

The Annual General Meeting granted the Board of Directors the authority to
acquire a maximum of 12,000,000 of the company's own shares. The authority is
valid until the close of the following Annual General Meeting and supersedes the
authority to acquire a maximum of 12,000,000 shares granted by the Annual
General Meeting of 24 March 2009.

The Annual General Meeting resolved to establish a Nomination Committee to
prepare proposals for the following Annual General Meeting regarding the
composition of the Board of Directors and directors' fees.

At its organisation meeting on 23 March 2010, the Board of Directors elected
members to its committees from among its members. Hannu Ryöppönen was elected as
chairman and Liisa Leino, Matti Lievonen and Jaana Tuominen as members of the
Audit Committee. Reino Hanhinen was elected as chairman and Maarit Aarni-Sirviö
and Pertti Korhonen as members of the Remuneration Committee.

Shares and share capital

During the first quarter of the year, 58,086 thousand (68,936) Rautaruukki Oyj
shares (RTRKS) were traded on NASDAQ OMX Helsinki for a total of EUR 887 million
(945). The highest price quoted was EUR 17.44 in January and the lowest was EUR
13.43 in February. The volume weighted average price during the first quarter
was EUR 15.27. The share closed at EUR 16.00 (12.06) at 31 March 2010 and the
company had a market capitalisation of EUR 2,245 million (1,692).

Rautaruukki's share is also traded on multilateral trading facilities (MTF).
According to information received by the company, a total of 8,892 thousand
shares were traded on multilateral trading facilities during the report period
for a total of EUR 135 million.

The company's registered share capital at 31 March 2010 was EUR 238.5 million
and there were 140,285,425 shares issued.

At 31 March 2010, the company held 1,421,575 treasury shares, which had a market
capitalisation of EUR 22.7 million and an accountable par value of EUR 2.4
million. Treasury shares accounted for 1.01 per cent of the total number of
shares and votes.

The 2009 Annual General Meeting granted the Board of Directors the authority to
decide on a share issue, which includes the right to issue new shares or to
transfer treasury shares held by the company. This authority applies to a
maximum of 15,000,000 shares in total. The Board of Directors has the right to
disapply the pre-emption right of existing shareholders. The authority also
includes the right to decide on a bonus issue. The authority is valid until the
close of the 2011 Annual General Meeting. The Board of Directors had not
exercised this authority by the end of the first quarter of 2010.

The 2010 Annual General Meeting granted the Board of Directors the authority to
acquire a maximum of 12,000,000 of the company's own shares. The authority is
valid until the close of the following Annual General Meeting. The Board of
Directors did not exercise this authority during the first quarter of 2010.

At the end of the report period, the Board of Directors had no valid authority
to issue options or other special rights providing entitlement to shares.


Flagging notifications

On 14 January 2010, the company received a disclosure notification from Capital
and Research Management Company (CRMC) under Chapter 2, Section 9 of the Finnish
Securities Markets Act that the aggregate holding in Rautaruukki shares for the
funds it manages had, as at 12 January 2010, increased to above five (5) per
cent. The number of Rautaruukki Oyj shares notified by CRMC was 7,297,852
shares, which equated to 5.20 per cent of Rautaruukki's share capital and votes.


Energy and the environment

Environmental matters at Ruukki are managed under certified ISO 14001:2004
environmental management systems. In March, Ruukki's steel service centre in St
Petersburg, Russia was a new unit to join the certified environmental management
system.

More information about environmental matters can be found in the company's
Annual Report for 2009, the environmental reports for the Raahe and Hämeenlinna
works and on the company's website.


Litigation and other pending legal actions
The European Commission continued investigations during the report period into
suspected price collusion relating to the manufacture of prestressing steel
between 1996 and 2001 by Ruukki's former subsidiary, Fundia. A decision is
expected to be reached during spring 2010. The Commission was investigating
dozens of European companies and Fundia's comparatively minor prestressing steel
business was not at the centre of the investigation.

Judgment was reached on 15 January 2010 in proceedings instigated in Sweden in a
case concerning safety at work as a result of a serious accident in 2008 at the
Kista Galleria construction site. All the prosecutor's claims against the
company's employee and Ruukki Sverige AB were dismissed. Settlement of the loss
and costs attributable to the accident are still going on between the parties
and insurance companies are still completing the claims processing.


Rise in cost of raw materials used in steel production and possible change in
pricing mechanism

No new price agreements in respect of coal and iron ore - the main raw materials
in steel production - have yet been made, but a clear rise in prices is
expected. The rise in the cost of raw materials will be offset by increasing
selling prices and by improving cost-efficiency. The scale and timing of price
rises will vary from one product and market area to another.

If it is agreed with raw material suppliers to continue pricing on an annual
basis, new prices for iron ore (both concentrate and pellets) will enter into
force retrospectively from the start of the year and the new price for coal from
the start of April.

The market is currently showing signs of a shift from annual pricing, a practice
used for decades, to one of quarterly or even spot pricing. Any aforementioned
change in the pricing mechanism would increase fluctuation in the company's raw
material costs in steel production and probably lead to a change in agreement
practices between Ruukki and its customers.


Other events

Under a decision taken by the Board of Directors of Rautaruukki's Pension
Foundation, management of the Foundation's statutory pensions liability under
the Finnish Employees Pensions Act (TyEL) was transferred to Varma Mutual
Pension Insurance Company on 31 December 2009. The pension liabilities
transferred by Rautaruukki's Pension Foundation at year-end 2009 totalled around
EUR 485 million. Transferring management of the Pension Foundation to Varma
gives Ruukki greater flexibility to arrange funding. The surplus, i.e. the part
of the funds to cover pension liability that exceeds the amount of pension and
other liabilities, accrued by the Foundation was refunded to the company in
conjunction with the transfer. According to current estimates the surplus is
around EUR 49 million. A refund of around EUR 27 million of the surplus was paid
in December 2009 and around EUR 22 million in March 2010. The transfer had no
material impact through profit and loss.


Risks and risk management

Risk management at Rautaruukki is guided by the operating principles and process
of corporate risk management defined in the risk management policy approved by
the company's Board of Directors. Risk management is an integrated part of the
management system. The company has described business risks and risk management
in detail in its annual report 2009. Except for the factors of uncertainty
presented under the heading "Rise in cost of raw materials used in steel
production and possible change in pricing mechanism" above, the company does not
consider any material changes to have taken place during the report period in
the risks and factors of uncertainty presented in the annual report 2009.


Near-term outlook

The economic outlook in Ruukki's main market areas has gradually improved and a
number of indicators suggest a continuation of economic recovery in the coming
months. Increased economic activity and improved financial conditions also
support investment-driven demand. However, slower economic recovery in Europe
compared to the rest of the world might limit an improvement in demand in the
company's main market areas.

It is thought the worst of the construction market downturn is now over.
Construction activity in the Nordic countries and in several countries in
Central Eastern Europe is expected to stabilise, but to further decline in the
Baltic states and Hungary. It is believed residential construction will grow in
the Nordic countries and Russia. Difficult market conditions persist in
commercial and industrial construction in nearly all market areas.
Infrastructure construction activity in the Nordic countries is expected to
continue to be good.

In the engineering business, market conditions are still challenging and no
significant change is yet expected during the second quarter of the year.
Overall demand in lifting, handling and transportation machinery and equipment
has stabilised at a low level, even though order intake volumes in mining and
forest machines have begun to rise. Minor positive development is discernible
also in the demand for heavy cargo handling equipment. The long-term market
outlook in equipment for the energy industry is good and demand is expected to
recover from its present level during the course of this year. Demand in
shipbuilding is expected to decline compared to the previous year.

It is believed that delivery volumes and selling prices in the steel business
will continue rising. Worldsteel forecasts growth of around 14 per cent in
apparent steel use in the EU-27 region in 2010 compared to 2009. Demand is
expected to improve in the heavy engineering industry and to continue to be good
in the automotive industry. As demand picks up in these industries, it is
estimated that delivery volumes of special steel products will increase compared
to the previous year. An expansion of the company's distribution network in
China and Turkey and into Brazil, for example, will also support sales of
special steel products. Prices of the main raw materials used in steel
production have yet to be agreed, but a clear rise in prices is expected. The
gradual recovery of demand and rise in raw material costs support the pricing of
steel products.

Modernisation of blast furnace 1 begun in April 2010 reduces the capacity
utilisation rate in steel production. The low utilisation rate during blast
furnace maintenance is expected to have a cost impact of around EUR 20 million
for the second quarter.

Thanks to actions initiated under the Boost programme to permanently improve
operational efficiency, the company's cost competitiveness is significantly
better than in previous years. Actions initiated since the start of the
programme are estimated to have an annualised impact on the company's
profitability of EUR 142 million. It is currently forecast that the aim of an
annualised improvement of EUR 150 million could possibly be achieved already in
the early part of 2011.

Based on the above factors, the company estimates a 15-20 per cent year-on-year
growth in net sales in 2010. Profitability is expected to improve significantly
compared to the previous year and the full-year result before income tax is
estimated to be positive.



This interim report is unaudited.

Helsinki, 22 April 2010

Rautaruukki Corporation

Board of Directors

BUSINESS AREAS

Ruukki Construction

----------------------------------------------------
EUR million       Q1/09 Q2/09 Q3/09 Q4/09 2009 Q1/10
----------------------------------------------------
Net sales           132   145   164   147  589   109

Operating profit    -13    -9    -4   -22  -49   -21

as % of net sales   -10    -6    -3   -15   -8   -19
----------------------------------------------------


Order intake and order backlog

The number of new orders in the construction business during the report period
was slightly down year on year and fell far short of the level of previous
years. A severe winter impacted particularly on order volumes for residential
roofing products. Order flow in commercial and industrial construction picked up
during the report period, but was still low. As in previous quarters, order flow
in infrastructure construction continued to be good. The order backlog in the
construction business at the end of the report period was somewhat higher than a
year earlier.


Net sales

Ruukki Construction's net sales for the first quarter of 2010 were down 17 per
cent year on year at EUR 109 million (132). The construction business accounted
for 22 per cent (26) of consolidated net sales in the report period.

A severe winter particularly affected demand for residential roofing products
and delivery volumes of these products remained low especially in Central
Eastern Europe and the Baltic states. Residential roofing products accounted for
10 per cent (12) of Ruukki Construction's net sales in the report period.

Weather conditions pushed back also the start of new commercial and industrial
construction projects and slowed the throughput of projects already under way.
The impact of this was seen especially in Central Eastern Europe. Caution in
investment-driven decisions continued in this segment and demand remained low.
Net sales of commercial and industrial construction were down year on year in
all market areas. Delivery volumes in Russia decreased noticeably less than in
other market areas. In Russia, deliveries for construction projects in the
energy industry and to publicly funded projects such as the construction of
agricultural buildings continued to be brisker than those for other industrial
sectors.

In infrastructure construction, net sales were up 45 per cent year on year on
the back of continued brisk activity in road and railway construction projects
in the Nordic countries. Ruukki successfully grew its share of Nordic bridge
projects. Thanks to a pick up in residential construction, demand for piles used
in housing construction also recovered year on year. Infrastructure construction
products accounted for 23 per cent (13) of Ruukki Construction's net sales in
the report period.


Operating profit

Ruukki Construction posted a negative operating profit of -EUR 21 million (-13)
for the first quarter of 2010. Operating profit was down year on year as a
result of lower sales volumes and selling prices. Selling prices during the
report period remained more or less at the same level as during the fourth
quarter of 2009.

Thanks to cost savings from permanent improvements in operational efficiency and
temporary adjustment measures, operating profit remained at the same level as
the previous quarter despite a clear fall in net sales.


Major orders

During the first quarter of the year, Ruukki Construction signed delivery
contracts for two extensive construction projects in Norway. Ruukki is
responsible for the design, manufacture, installation and fire protection of the
steel frame for the new head office of financial services group DnB NOR to be
built in the Norwegian capital of Oslo. Ruukki is also to be responsible for the
manufacture, fabrication design, installation and fire protection of the steel
frame in a construction project to build a new concert hall in Stavanger.
Deliveries will begin in May 2010 for the head office project and in April 2010
for the concert hall project. The contracts are worth a total of around EUR 8
million.


Improved operational efficiency

In December 2009, a decision was made to further improve operational efficiency
and adjust operations in Finland by streamlining the organisation and operating
model and by improving production efficiency at the plants in Vimpeli, Alajärvi
and Peräseinäjoki. Employer-employee negotiations initiated due to these actions
ended in January 2010 and resulted in the loss of 52 jobs.

In the construction business, centralising product manufacture on increasingly
larger units continued by transferring steel structure production at the Holic
unit in Slovakia to Ruukki's other units in Central Eastern Europe. In future,
the Holic plant will make cabins for Ruukki's engineering customers.


Ruukki Engineering

------------------------------------------------------
EUR million         Q1/09 Q2/09 Q3/09 Q4/09 2009 Q1/10
------------------------------------------------------
Net sales             125    75    63    49  312    47

Operating profit *      5    -2    -7   -11  -16    -8

as % of net sales *     4    -3   -12   -23   -5   -16
------------------------------------------------------
* Excluding non-recurring items.


Order intake and order backlog

Order flow in the engineering business during the report period was lower year
on year, but noticeably better than for the fourth quarter of 2009. New orders
were secured particularly from customers in the mining and forest machine
sectors. Business activity also began to pick up in the transportation equipment
sector, but this was still not clearly reflected in orders received. There were
very few orders from customers in the shipbuilding industry. Likewise, there
were few orders from equipment manufacturers in the energy industry. The order
backlog in the engineering business at the end of the report period was much
lower than a year earlier.


Net sales

Ruukki Engineering's net sales for the first quarter of 2010 were down clearly
year on year at EUR 47 million (125). The engineering business accounted for 9
per cent (25) of consolidated net sales.

Net sales excluding the Mo i Rana unit in Norway were EUR 42 million (100).
Operations at the Mo i Rana unit will be discontinued by mid-May 2010 until
further notice. The quarterly net sales and operating profit of the Mo i Rana
unit since 2009 are presented at the end of the tables section.

Delivery volumes were down clearly compared to the first quarter of 2009. Except
for the manufacture of equipment for the mining and forest industries, delivery
volumes decreased in all main customer segments, especially in the manufacture
of equipment for the wind power industry and in shipbuilding.

There was no major change in delivery volumes compared to the fourth quarter of
2009. However, the slight rise in the manufacture of equipment for the mining
and forest industries continued. Likewise, small positive development was also
discernible in deliveries to manufacturers of heavy cargo handling equipment.
Delivery volumes to equipment manufacturers in the energy industry continued
falling. Funding difficulties faced by new wind farm projects have temporarily
weakened demand. Deliveries to other sectors in the energy industry remained at
the same level as during the previous quarter.

Selling prices during the report period were much lower than in the same period
a year earlier, but remained mostly at the same level as during the fourth
quarter of 2009.

Manufacturers of lifting, handling and transportation equipment accounted for
60 per cent (38) of the net sales of the engineering business in the report
period and equipment manufacturers in the energy industry for 16 per cent (34).


Operating profit

Ruukki Engineering posted a negative operating profit for the first quarter of
2010 of -EUR 8 million (5) and operating profit excluding the Mo i Rana unit was
-EUR 5 million (9). The operating loss was mainly due to the low capacity
utilisation rate at units and to small delivery volumes. Also lower selling
prices weakened operating profit year on year.


Major orders

During the report period, Ruukki signed a major contract to deliver plates for
an Antarctic supply and research vessel to be built at a shipyard in Rauma,
Finland. The plate deliveries total 6,000 tonnes and will begin in August this
year.


Capital expenditure, business and product development

Ruukki is strengthening its cabin business in Central Eastern Europe and during
the course of the second quarter will begin to make fully-assembled cabins also
at its plant in Holic, Slovakia. Deliveries from Holic will be mostly destined
for the Central and Eastern European markets. The Kurikka unit in Finland is to
become a centre of excellence focusing on cabin product development and tool
design. The Kurikka unit also continues making cabins especially for the Nordic
markets. Cabin manufacture is also being increased at the Shanghai unit in
China.

A decision was taken during the first quarter of the year to invest in a new
paint shop and packaging dispatch department at the Jaszbereny plant in Hungary.
When completed, the new paint shop will be one of the most modern in Europe that
is capable of processing large components. The paint shop will come on stream by
the end of the year. The cost of the total investment is around EUR 5 million.


Improved operational efficiency

In February, a decision was announced to discontinue operations until further
notice at the Mo i Rana unit in Norway, which makes shipbuilding profiles and
flange profiles for windmill towers. The plan is to close operations at the
plant by mid-May. Due to subdued demand in the shipbuilding industry,
profitability of the Mo i Rana unit has been weak. In addition, there has been a
noticeable decline in delivery volumes for the manufacture of equipment for the
wind power industry. Discontinuation of operations will lead to the loss of 110
jobs.

In December 2009, plans were announced to transfer the manufacture of
engineering components at the Peräseinäjoki in Finland unit to Ruukki's other
units. Employer-employee negotiations initiated in this context ended in January
2010 and the manufacture of components was transferred to Kalajoki in Finland
during the first quarter of 2010.


Ruukki Metals

-----------------------------------------------------
EUR million       Q1/09 Q2/09 Q3/09 Q4/09  2009 Q1/10
-----------------------------------------------------
Net sales           249   218   257   325 1 050   348

Operating profit   -102   -97   -39    10  -228    -4

as % of net sales   -41   -44   -15     3   -22    -1
-----------------------------------------------------


Order intake and order backlog

In the steel business, there was a marked increase in order intake during the
report period both year on year and compared to the previous quarter. The order
flow in special steel products grew and orders from new markets - China, Turkey
and Brazil - showed good development. The order backlog in the steel business at
the end of the report period was more than double that a year earlier.


Net sales

Ruukki Metals' net sales for the first quarter of 2010 were up 40 per cent year
on year at EUR 348 million (249). The steel business accounted for 69 per cent
(49) of consolidated net sales.

The gradual recovery in demand beginning in the second half of 2009 continued
and delivery volumes of steel products increased clearly in the first quarter of
2010 compared to the exceptionally low level a year earlier. Deliveries to
subcontractors in the automotive industry in Sweden were brisker than to other
customer sectors. Demand for cold-rolled and galvanised strip has recovered
faster than that for other products. A severe winter meant that delivery volumes
for construction remained quite low in all market areas. Consequently, there was
little change in overall delivery volumes compared to the fourth quarter of
2009.

Prices of steel products were clearly lower during the report period than a year
earlier and were roughly at the same level as during the fourth quarter of
2009. Even though prices rose to a certain extent towards the end of the first
quarter of 2010, this had no material impact on net sales in the report period.

Sales of special steel products improved somewhat better than other product
groups owing to a slight pick-up in the activity of key customer industries -
such as heavy engineering and truck-making - using special steel products.
Expansion of the distribution network also helped to improve sales of special
steel products, which accounted for 20 per cent (18) of Ruukki Metals'
first-quarter net sales. Net sales of stainless steel and aluminium sold as
trading products remained at the same level year on year at EUR 28 million (28).


Operating profit

Ruukki Metals posted a negative operating profit for the first quarter of 2010
of -EUR 4 million (-102), which is a significant improvement year on year.
Operating profit improved year on year as a result of higher delivery volumes,
lower raw material prices, cost savings implemented and a high capacity
utilisation rate in steel production.

Operating profit for the report period was below that for the fourth quarter of
2009. Emission allowances were sold for EUR 4 million during the first quarter
of 2010, whereas emission allowances were sold for EUR 31 million during the
fourth quarter of 2009. Operating profit on stainless steel and aluminium was up
year on year at EUR 1 million (-3).


Steel production

----------------------------------------------------
1000 tonnes      Q1/09 Q2/09 Q3/09 Q4/09  2009 Q1/10
----------------------------------------------------
Steel production   269   392   604   628 1 892   611
----------------------------------------------------


The company's steel production during the first quarter of 2010 was 611 thousand
tonnes (269). The capacity utilisation rate in steel production was at a good
level during the report period, whereas it was less than 50 per cent a year
earlier, when one of the two blast furnaces at the Raahe Steel Works in Finland
was idle.

At the start of April, after the report period, one of the two blast furnaces at
the Raahe Steel Works was shut down for modernisation. The blast furnace will
remain idle for around two months and it is expected to take between four and
six weeks from start-up before it returns to normal production levels.


Major orders

In January, Ruukki announced a delivery to the Netherlands, where Ruukki is
delivering prefabricated components for seven steel oil storage tanks to be
built in the Port of Rotterdam. The steel plates will be made and prefabricated
at Ruukki's Raahe Steel Works in Finland and be delivered to the customer as
ready-to-install steel components. Deliveries will be complete in August this
year. The order is worth almost EUR 6 million.


Capital expenditure

Blast furnace 1 at the Raahe Steel Works in Finland will undergo modernisation
in 2010. The company is planning to modernise blast furnace 2 in 2011. Blast
furnace modernisation is a necessary maintenance investment. Modernisation of
blast furnace 1 began in April, after the report period. In connection with
blast furnace modernisation, the company will switch over to using iron ore
pellets instead of sinter as the sole raw material in the iron-making process.
The sinter plant currently in use will be closed down by the end of 2011.
Environmental investments will also be made in connection with blast furnace
modernisation.

The investments planned for 2009-2011 to modernise the blast furnaces and to
change the feedstock base total around EUR 220 million, in addition to which
some EUR 60 million will be spent on environmental investments. EUR 46 million
of the investments were made by the end of 2009. Some EUR 125 million of
investments are expected to be scheduled for 2010 and EUR 110 million for 2011.


Distribution network expansion and product development

Expansion of the distribution network for special steel products is one of the
main focus areas in the steel business during the current year. During the
report period, the company strengthened its distribution network by signing
agreements on distribution cooperation in Brazil. Likewise, the sales network in
China and Turkey was further expanded in the early part of the year through new
agreements on distribution cooperation.

The first quarter of 2010 saw Ruukki launch a new high-strength,
weather-resistant structural steel, Optim 960 QCW. The new steel grade is ideal
for applications where the steel is subject to mechanical stress and at the same
time exposed to weather conditions. Such applications include containers, cranes
and booms. Optim 960 QCW steel is made using a direct quenching process
developed by Ruukki.

In April, after the report period, Ruukki announced Optim 700 MC Plus, an
improved high-strength structural steel with excellent cold-forming properties.
These properties can be utilised in, for example, the manufacture of cranes,
bodies for trucks and other mobile machines, goods handling equipment,
earthmoving, mining and waste handling equipment.

TABLES

This interim report has been prepared in accordance with IAS 34 Interim
Financial Reporting and is in conformity with the accounting policies published
in the 2009 financial statements.

The consolidated financial statements are affected by the following IFRS
standards and interpretations thereof entering into force on 1 January 2010:

  * Revised IFRS 3 Business Combinations
  * Amended IAS 27 Consolidated and Separate Financial Statements


The revised and amended standards referred to above had no impact on this
interim report.

Use of estimates
The preparation of interim reports in conformity with IFRS requires management
to make estimates and assumptions that affect the reported amounts of assets and
liabilities, the reporting of contingent assets and liabilities and the reported
amounts of income and expense. Even though these estimates are based on
management's best judgment at the time, actual results may ultimately differ
from these estimates.


Individual figures and totals appearing in the tables have been rounded to the
nearest full million of euros.

The figures are unaudited.

CONSOLIDATED INCOME STATEMENT
-----------------------------------------------------------------
EUR million                                     Q1/10 Q1/09  2009
-----------------------------------------------------------------
Net sales                                         505   506 1 950

Cost of sales                                     485   554 2 027
-----------------------------------------------------------------
Gross profit                                       20   -47   -77



Other operating income                              4     7    20

Selling and marketing expenses                     23    30   113

Administrative expenses                            37    41   151

Other operating expenses                            0     1     2
-----------------------------------------------------------------
Operating profit                                  -36  -113  -323



Finance income                                     22    45    81

Finance costs                                      30    54   117
-----------------------------------------------------------------
Net finance costs                                  -8    -9   -36



Share of profit of equity-accounted investees       0     0     0
-----------------------------------------------------------------
Result before income tax                          -44  -122  -359

Income tax expense                                 11    32    84
-----------------------------------------------------------------
Result for the period                             -33   -90  -275



Attributable to:

Owners of the company                             -33   -90  -275

Non-controlling interest                            0     0     0



Earnings per share, diluted, EUR                -0.24 -0.65 -1.98

Earnings per share, basic, EUR                  -0.24 -0.65 -1.98

Operating profit as % of net sales               -7.2 -22.2 -16.6
-----------------------------------------------------------------


CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
--------------------------------------------------------------------------------
EUR million                                                     Q1/10 Q1/09 2009
--------------------------------------------------------------------------------
Result for the period                                             -33   -90 -275

Other comprehensive income:

Effective portion of changes in fair value of cash flow hedges     -7     1   51

Translation differences                                            16   -22   -5

Defined benefit plan actuarial gains and losses                    -2     0  -15

Tax on other comprehensive income                                   2    -1   -9
--------------------------------------------------------------------------------
Other comprehensive income for the period, net of tax              10   -21   22
--------------------------------------------------------------------------------
Total comprehensive income for the period                         -23  -111 -253



Attributable to:

Owners of the company                                             -23  -111 -253

Non-controlling interest                                            0     0    0
--------------------------------------------------------------------------------


SUMMARY CONSOLIDATED STATEMENT OF FINANCIAL POSITION
--------------------------------------------------------------------------------
EUR million                                  31 Mar 2010 31 Mar 2009 31 Dec 2009
--------------------------------------------------------------------------------
ASSETS

Non-current assets                                 1 418       1 411       1 404

Deferred tax assets                                   45          30          39

Current assets

 Inventories                                         533         625         492

 Trade and other receivables                         402         415         335

 Cash and cash equivalents                           129         459         261
--------------------------------------------------------------------------------
Total assets                                       2 527       2 941       2 532



EQUITY AND LIABILITIES

Equity

 Equity attributable to owners of the
company                                            1 422       1 658       1 507

 Non-controlling interest                              2           2           2

Non-current liabilities

 Loans and borrowings                                377         394         387

 Non-interest bearing liabilities                     63          61          61

Deferred tax liabilities                              29          71          37

Current liabilities

 Loans and borrowings                                174         188         209

 Trade payables and other non-interest
bearing liabilities                                  461         568         328
--------------------------------------------------------------------------------
Total equity and liabilities                       2 527       2 941       2 532
--------------------------------------------------------------------------------


SUMMARY CONSOLIDATED STATEMENT OF CASH FLOWS
--------------------------------------------------------------
EUR million                                   Q1/10 Q1/09 2009
--------------------------------------------------------------
Result for the period                           -33   -90 -275

Adjustments                                      15    50  178
--------------------------------------------------------------
Cash flow before change in working capital      -18   -40  -97

Change in working capital                       -19   114  317

Financing items and taxes                       -18     2  -38
--------------------------------------------------------------
Net cash flow from operating activities         -55    76  182

Cash inflow from investing activities             2     3   17

Cash outflow from investing activities          -34   -49 -170
--------------------------------------------------------------
Net cash used in investing activities           -32   -46 -153
--------------------------------------------------------------
Net cash flow before financing activities       -87    30   30

Dividends paid                                            -188

Proceeds from loans and borrowings                3   283  434

Repayments of loans and borrowings              -12  -164 -330

Change in current liabilities                   -35    54   76

Other net cash flow from financing activities    -2     4  -18

Translation differences                           2    -2    1
--------------------------------------------------------------
Change in cash and cash equivalents            -132   205    7
--------------------------------------------------------------


KEY FIGURES
--------------------------------------------------------------------------------
                                                   Q1/10       Q1/09        2009
--------------------------------------------------------------------------------
Net sales, EUR m                                     505         506       1 950

Operating profit, EUR m                              -36        -113        -323

as % of net sales                                   -7.2       -22.2       -16.6

Result before income tax, EUR m                      -44        -122        -359

as % of net sales                                   -8.7       -24.0       -18.4

Result for the period, EUR m                         -33         -90        -275

as % of net sales                                   -6.5       -17.8       -14.1

Return on capital employed (rolling 12
mths), %                                           -11.5        14.5       -14.2

Return on equity (rolling 12 mths), %              -14.1        11.3       -15.9

Equity ratio, %                                     56.9        56.7        59.9

Gearing ratio, %                                    29.6         7.4        22.3

Net interest-bearing liabilities, EUR m              422         122         336

Equity per share, EUR                              10.24       11.94       10.85

Personnel on average                              11 525      13 460      12 664

Number of shares                             140 285 425 140 264 945 140 285 425

 - excluding treasury shares                 138 863 850 138 845 063 138 863 850

 - diluted, average                          138 863 850 138 818 458 138 846 063
--------------------------------------------------------------------------------


CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
--------------------------------------------------------------------------------
                   Equity attributable to owners of the company
                 -------------------------------------------------
                                       Fair                          Non-
                                      value  Trans-           Re-   cont-
                                  and other  lation  Trea- tained rolling
                    Share   Share       re-   diff-   sury  earn-  inter-  Total
EUR million       capital premium    serves erences shares   ings     est equity
--------------------------------------------------------------------------------
EQUITY 1 Jan 2009     238     220       -37     -36     -6  1 568       2  1 950

 Result for the
period                                                        -90       0    -90

 Other
comprehensive
income                                    1     -22                          -21
--------------------------------------------------------------------------------
Total
comprehensive
income for the
period                                    1     -22           -90       0   -111

Share issue             0                                                      0

Dividend
distribution                                                 -187           -187

Share-based
payments                                                 0                     0

Transfers between
retained earnings
and comprehensive
income                                           16            -7              9
--------------------------------------------------------------------------------
EQUITY 31 Mar
2009                  238     220       -36     -42     -6  1 283       2  1 660



EQUITY 1 Jan 2010     238     220         2     -41     -6  1 095       2  1 509

 Result for the
period                                                        -33            -33

 Other
comprehensive
income                                   -5      16            -1             10
--------------------------------------------------------------------------------
Total
comprehensive
income for the
period                                   -5      16           -34            -23

Dividend
distribution                                                  -62            -62

Share-based
payments                                                 0      0              0

EQUITY 31 Mar
2010                  238     220        -3     -26     -6    998       2  1 424
--------------------------------------------------------------------------------


NET SALES BY REGION
------------------------------------------------------------
As % of net sales                           Q1/10 Q1/09 2009
------------------------------------------------------------
Finland                                        28    32   30

Other Nordic countries                         32    33   31

Central Eastern Europe, Russia and Ukraine     14    15   19

Rest of Europe                                 20    14   14

Other countries                                 6     5    6
------------------------------------------------------------


CONTINGENT LIABILITIES
------------------------------------------------------
EUR million                           Q1/10 Q1/09 2009
------------------------------------------------------
Mortgaged real estate                    64    73   64

Pledged assets                                  1

Other guarantees given                   40    39   43

Collateral given on behalf of others            4

Rental liabilities                      104   127  114
------------------------------------------------------


DERIVATIVE CONTRACTS
--------------------------------------------------------------------------------
CASH FLOW HEDGES QUALIFYING FOR HEDGE ACCOUNTING

                          31 Mar 2010             31 Mar 2009
                              Nominal 31 Mar 2010     Nominal        31 Mar 2009
EUR million                    amount  Fair value      amount         Fair value
--------------------------------------------------------------------------------
Zinc derivatives

 Forward contracts,
tonnes                         24 000           8      36 000                -26

Electricity derivatives

 Forward contracts, GWh         1 815         -13       1 886                -24



FAIR VALUE HEDGES QUALIFYING FOR HEDGE ACCOUNTING

                          31 Mar 2010             31 Mar 2009
                              Nominal 31 Mar 2010     Nominal        31 Mar 2009
EUR million                    amount  Fair value      amount         Fair value
--------------------------------------------------------------------------------
Interest rate derivatives          75           1



DERIVATIVES NOT QUALIFYING FOR HEDGE ACCOUNTING

                          31 Mar 2010             31 Mar 2009
                              Nominal 31 Mar 2010     Nominal        31 Mar 2009
EUR million                    amount  Fair value      amount         Fair value
--------------------------------------------------------------------------------
Zinc derivatives

Forward contracts, tonnes           0           0           2                  0

Foreign currency
derivatives

 Forward contracts                416          -4         811                 14

 Options

  Bought                          425           1          65                  7

  Sold                            143           1          68                  1
--------------------------------------------------------------------------------


The unrealised movements in the fair value of cash flow hedges are recognised in
other comprehensive income items to the extent the hedge is effective. Other
movements in fair value are recorded through profit and loss.


CHANGES IN PROPERTY, PLANT AND EQUIPMENT
------------------------------------------------------------
EUR million                                Q1/10 Q1/09  2009
------------------------------------------------------------
Carrying amount at the beginning of period 1 159 1 124 1 124

Additions                                     32    37   167

Additions through acquisitions                       3     5

Disposals                                     -1    -2   -11

Depreciation and impairment                  -31   -32  -125

Translation differences                       12   -10    -1
------------------------------------------------------------
Carrying amount at the end of period       1 171 1 119 1 159
------------------------------------------------------------


TRANSACTIONS WITH RELATED
PARTIES
--------------------------------------------------------------------------------
EUR million                                        Q1/10       Q1/09        2009
--------------------------------------------------------------------------------
Sales to equity-accounted investees                   10           6          24

Purchases from equity-accounted investees              2           1           6

Transactions with Rautaruukki Pension
Foundation                                             0           2           6



                                             31 Mar 2010 31 Mar 2009 31 Dec 2009
--------------------------------------------------------------------------------
Trade and other receivables from related
parties                                                6           3           3

Trade and other payables to related parties            1           0           1
--------------------------------------------------------------------------------


INVESTMENT
COMMITMENTS
--------------------------------------------------------------------------------
                                      After 31 Mar   After 31 Mar   After 31 Dec
EUR million                                   2010           2009           2009
--------------------------------------------------------------------------------
Maintenance investments                         51            106            100

Development investments and
investments in special steel
products                                        58             82             77
--------------------------------------------------------------------------------
Total                                          109            188            177
--------------------------------------------------------------------------------


SEGMENT INFORMATION
--------------------------------------------------------------------------------
EUR million                                        Q1/10       Q1/09        2009
--------------------------------------------------------------------------------
External net sales

 Ruukki Construction                                 109         132         589

 Ruukki Engineering                                   47         125         312

 Ruukki Metals                                       348         249       1 050

 Corporate management                                  0           0           0
--------------------------------------------------------------------------------
Consolidated net sales                               505         506       1 950



Operating profit

 Ruukki Construction                                 -21         -13         -49

 Ruukki Engineering                                   -8           5         -33

 Ruukki Metals                                        -4        -102        -228

 Corporate management                                 -4          -3         -13
--------------------------------------------------------------------------------
Consolidated operating profit                        -36        -113        -323



Net finance costs                                     -8          -9         -36

Share of profit of equity-accounted
investees                                              0           0           0
--------------------------------------------------------------------------------
Result before income tax                             -44        -122        -359

Income tax expense                                    11          32          84
--------------------------------------------------------------------------------
Result for the period                                -33         -90        -275



EUR million                                  31 Mar 2010 31 Mar 2009 31 Dec 2009
--------------------------------------------------------------------------------
Segment assets

 Ruukki Construction                                 661         710         718

 Ruukki Engineering                                  252         471         253

 Ruukki Metals                                     1 260       1 018       1 085

 Corporate management                                 30          42          31

 Undistributed assets                                324         700         445
--------------------------------------------------------------------------------
Total assets                                       2 527       2 941       2 532
--------------------------------------------------------------------------------


QUARTERLY SEGMENT INFORMATION, EXCLUDING NON-RECURRING ITEMS
--------------------------------------------------------------------------------
EUR million                                  Q1/09 Q2/09 Q3/09 Q4/09  2009 Q1/10
--------------------------------------------------------------------------------
External net sales

 Ruukki Construction                           132   145   164   147   589   109

 Ruukki Engineering                            125    75    63    49   312    47

 Ruukki Metals                                 249   218   257   325 1 050   348

 Corporate management                            0     0     0     0     0     0
--------------------------------------------------------------------------------
Consolidated net sales                         506   438   485   521 1 950   505



Operating profit

 Ruukki Construction                           -13    -9    -4   -22   -49   -21

 Ruukki Engineering                              5    -2    -7   -11   -16    -8

 Ruukki Metals                                -102   -97   -39    10  -228    -4

 Corporate management                           -3    -4    -3    -3   -13    -4
--------------------------------------------------------------------------------
Consolidated operating profit                 -113  -112   -54   -27  -306   -36



Net finance costs                               -9   -10   -10    -7   -36    -8

Share of profit of equity-accounted
investees                                        0     0     0     0     0     0
--------------------------------------------------------------------------------
Result before income tax                      -122  -123   -64   -34  -342   -44

Income tax expense                              32    33    19     0    84    11
--------------------------------------------------------------------------------
Result for the period                          -90   -89   -45   -34  -258   -33
--------------------------------------------------------------------------------


RUUKKI ENGINEERING: MO I RANA UNIT
-----------------------------------------------------
EUR million        Q1/09 Q2/09 Q3/09 Q4/09 2009 Q1/10
-----------------------------------------------------
Net sales             25     8    10     6   49     5

Operating profit *    -3    -6    -4    -3  -17    -2
-----------------------------------------------------
* Excluding non-recurring items.


Formulas for the calculation of key figures:
Return on capital           result before income tax + finance costs -
employed, %                 exchange rate gains (rolling 12 months)
                          = ---------------------------------------         x100

                            total equity + loans and borrowings
                            (average at beginning and end of period)



Return on equity, %         result before income tax - income tax expense
                                (rolling 12 months)
                          = ---------------------------------------         x100

                            total equity (average at beginning and end of
                            period)



Equity ratio, %             total equity
                          = ---------------------------------------         x100

                            total assets - advances received



Gearing ratio, %            net interest-bearing financial liabilities
                          = ---------------------------------------         x100

                            total equity



Net interest-bearing      = loans and borrowings - financial assets and
financial liabilities       cash and cash equivalents



Earnings per share (EPS)    result for the period attributable to equity
                            holders of the parent company
                          = ---------------------------------------

                            weighted average number of shares outstanding
                            during the period



Earnings per share (EPS),   result for the period attributable to equity
diluted                     holders of the parent
                          = ---------------------------------------

                            weighted average diluted number of shares
                            outstanding during the period



Equity per share            equity attributable to owners of the parent
                            company
                          = ---------------------------------------

                            basic number of shares outstanding at the end
                            of period



Volume weighted average     total EUR trading of shares
price                     = ---------------------------------------

                            total number of shares traded



Market capitalisation     = basic number of shares at the end of period x
                            closing price at the end of period



Personnel on average      = total number of personnel at the end of each
                            month divided by the number of months






[HUG#1406667]





    Interim_report_Q1_2010: 

http://hugin.info/3013/R/1406667/360154.pdf