Structural changes in focus

Business area Sweden & Poland accounted for 52 percent (49) of BE Group’s net sales in 2024. The business area includes the Group’s operations in Sweden, the joint venture ArcelorMittal BE Group SSC AB and the Polish operation BE Group Poland Sp.z.o.o., which is under closure. The operations in Sweden consist of production and warehouse facilities in Norrköping and sales offices in eight cities.

In the fourth quarter, the decision was made to close the Polish unit and to move the operations to Sweden and Finland. In 2024, the Polish unit accounted for just over 1 percent of the Group’s total sales. The closure, which involves about 80 people, will be implemented in the first half of 2025 and is expected to have positive effect with a payback period of less than one year. Non-recurring costs are estimated to amount to approximately SEK -28 M and has been charged to the operating result.

The company has roughly 2,000 customers in the Swedish market and the ten largest customers account for 35 percent of the business area’s sales. Local presence, a high level of service and good understanding of customers are prerequisites for meeting the market needs. The competitors in the market include SSAB-owned Tibnor as well as Stena Stål, which is a part of the Stena Group.

Sales and business performance

Net sales for the year decreased by -8 percent compared to last year, and amounted to SEK 2,423 M (2,641). The decrease is explained by negative price and mix effects of -6 percent and negative organic tonnage growth of -2 percent. The decrease in tonnage is mainly explained by lower demand for rebar. Excluding rebar, tonnage increased by 5 percent.

The operating result amounted to SEK -32 M (-24). Adjusted for inventory losses of SEK -48 M (-59) and items affecting comparability of SEK -28 M (-4), the underlying operating result increased to SEK 44 M (39). The low underlying result is mainly explained by declining steel prices in a weak market and a pressured gross margin.

BE Group owns 50 percent of the company ArcelorMittal BE Group SSC AB in Karlstad. The company is a modern steel service center where thin sheets and coils are cut and slit, with a turnover of SEK 897 M (1,044) during 2024. The company is reported in accordance with the equity method and the participation in earnings for the year amounted to SEK 18 M (23).

Continued development

In 2024, focus was on continuing to meet our customers demands in a professional manner, strengthening cash flow and implementing the strategic and structural work to improve results in a weak market. The geopolitical situation remains uncertain, the market situation is tough and the recovery within the automotive industry and the construction sector is expected to progress slowly in 2025. The strategic work with enhancing growth, strengthen margins and to streamline operations will continue in 2025. The closure of the Polish unit is expected to lead to significant cost savings and a decreased carbon footprint. Given the strategic and structural changes initiated and implemented in 2024, provided that no other major changes occur, 2025 is expected to be a better year.