Outokumpu's first quarter 2009 - significant op...

PRESS RELEASE
April 23, 2009 at 9.10 am

Highlights

Operating profit EUR -249 million, underlying operational result some
EUR -134 million
Low deliveries and prices due to very weak demand for stainless steel
Very strong operating cash flow EUR 301 million, gearing 32%


Group key figures, EUR million               I/09  I/08  IV/08

Sales                                        679   1 689 966
Operating profit                             -249  100   -271
Profit before taxes                          -252  80    -298
Net profit for the period                    -187  63    -233
Earnings per share, EUR                      -1.04 0.35  -1.30
Net cash generated from operating activities 301   107   205

Stainless steel deliveries, 1000 tons        247   449   261
Stainless steel base price, EUR/t 1)         925   1 243 1 045
Stainless steel transaction price, EUR/t     1 818 2 945 2 338

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



During the first quarter of 2009 Outokumpu continued to suffer
severely from the global economic downturn. Low investment and
construction activity and cautious consumer spending have weakened
the underlying demand for stainless steel. The distributors and
end-users of stainless as well as the entire value chain reduced
their inventories heavily. Stainless markets remained oversupplied
and all producers continued to cut production.

Outokumpu's deliveries of stainless steel declined by 45% to 247 000
tons in the first quarter compared to the rather normal first quarter
of 2008. Prices were under pressure during the whole quarter. Base
prices declined on average by 26% and transaction prices, which also
include raw material costs, dropped by 38%. All raw material prices
were significantly below their year-ago levels, nickel by 64% and
ferrochrome by 25% for example. As a result, Outokumpu's sales fell
by a remarkable 60% to EUR 679 million in the first quarter.

Due to the very low delivery volumes and low base prices, Outokumpu's
underlying operational result was negative at EUR 134 million.
Additionally, there were raw material related inventory losses of
some EUR 110 million resulting in an operating loss of EUR 249
million. Due to the efficient decrease in inventory levels throughout
Outokumpu's whole supply chain and due to lower metal prices, net
working capital declined by EUR 555 million. Consequently, operating
cash flow was very strong at EUR 301 million and despite heavy
losses, gearing improved further to 32%.

Outokumpu's cost saving programmes are proceeding according to plan.
Including also the latest actions Outokumpu estimates that total
fixed cost savings will be in excess of EUR 100 million in 2009.

Visibility concerning the stainless steel market continues to be
short. Outokumpu expects its second-quarter underlying operational
loss to be at the same level or slightly smaller than in the first
quarter.

CEO Juha Rantanen:

"The stainless markets were exceptionally weak and this is reflected
in our loss-making first quarter. This market weakness is a result of
both lower end-user demand and heavy de-stocking in the long value
chain to end consumers. The de-stocking will certainly come to an end
at some point.

In management, our main focus is now on maximizing cash flow by
generating profitable sales, by cutting costs, limiting capital
expenditure as well as reducing working capital. It is encouraging
that these efforts resulted in strong cash flow generation during the
first quarter. As the potential for further reductions in working
capital is rather limited, increased effort is going into identifying
additional cost-saving actions on top of those already being
implemented."

This press release is a summary of Outokumpu's official first quarter
2009 report.

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]

News conference and live webcast today at 12.00 pm

The Outokumpu Group will publish the first-quarter 2009 financial
results on
Thursday April 23, 2009 at 9.00 am Finnish time.

A combined news conference, conference call and live webcast
concerning the first-quarter 2009 results will be held on April 23,
2009 at 12.00 pm Finnish time (11.00 am CET, 5.00 am US EST, 10.00 am
UK time) at Hotel Kämp, conference room Akseli Gallen-Kallela,
Pohjoisesplanadi 29, 00100 Helsinki, Finland.

To participate via a conference call, please dial in 5-10 minutes
before the beginning of the event:

UK [phone]
US & Canada [phone]
Sweden [phone]
Password Outokumpu

The news conference can be viewed live via Internet at
www.outokumpu.com.
Stock exchange release and presentation material will be available
before the news
conference at www.outokumpu.com/Investors.

An on-demand webcast of the news conference will be available at
www.outokumpu.com as of April 23, 2009 at around 6.00 pm.

OUTOKUMPU OYJ
Corporate Management

Ingela Ulfves
Vice President - Investor Relations & Financial Communications
tel. + 358 9 421 2438, mobile [phone]
[e-mail]
www.outokumpu.com


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