Strengthened financial position leads to flexibility and opportunities in an uncertain market

In the second quarter, net sales fell by 18% to SEK 1,045 M (1,272), which is mainly attributable to tough market conditions, lower prices and continued challenges in the Finnish operations following the transition to a new business system in early March. All in all, this means that the underlying result amounted to SEK -36 M (18). Items affecting comparability, primarily impairment of goodwill but also write-down of capitalized expenses for the new business system and restructuring of business area Sweden & Poland, negatively impact earnings by SEK -463 M, of which impairment of goodwill amounts to SEK -409 M. The goodwill items are related to historical acquisitions in the Swedish and Finnish operations and do not reflect the current situation and business environment.

The transfer of the Polish operations to Sweden and Finland and the transfer of production from Arvika to Norrköping are essentially concluded. Both will have a positive impact on earnings.

Updated loan agreement and secured rights issue

A new long-term loan agreement has been signed with SEB. The agreement entails an obligation for BE Group to carry out a rights issue comprising of approximately SEK 143 M, which the Board of Directors has approved. The issue, secured by the company’s two principal shareholders, AB Traction and Svedulf Fastighets AB, is aimed at strengthening the balance sheet and thereby providing better stability and financial flexibility.

Outlook

In the second quarter of 2025, the steel market in the Nordic region and Europe continued to be characterized by uncertainty, low demand and increasing import pressure, which led to falling steel prices for both flat and long products. After a brief increase in April, prices fell back in May and June. The drop in prices is attributable to weak demand in both construction and industry, high inventories and increased imports from non-EU countries. Despite increased production costs, especially for energy, steel producers have been unable to maintain price levels. A possible stabilisation is expected in the autumn, as trade policy measures within the EU have an impact. Demand in construction has continuously improved from very low levels and is expected to continue improving although slowly. Demand from industry is expected to remain under pressure but is supported by some major customers who have indicated increased demand in the second half of the year.

Our focus

The most important thing at the moment is to implement the developed action plan in Finland focusing on increased efficiency, improved delivery capacity and increased customer satisfaction to regain lost tonnage while continuing to implement the group-wide savings program announced earlier. As I usually say, a lot of steel is used even in bad times and it is important to maintain a high level of market activity and to ensure a good margin in every single transaction.

An important message to the market in the second half of the year is the launch of BELOW which is BE Group’s new brand for low carbon steel. An example of this is that we have lowered our emissions on long products with approximately 40% by actively choosing suppliers with very low CO₂ emissions. As a part of BELOW we have also launched a climate calculator where the customer is able to track its climate impact in the e-commerce solution and generate a climate report.

Peter Andersson
President and CEO