Stainless Steel Me

 Spanish stainless steelmaker Acerinox  posted a 10.5 million euro ($13.4 million) net loss in 2008 as demand crumbled and it wrote down 128 million euros for the lost value of raw-material inventories.

The Spanish company was expected to report net profit of 20.1 million euros after writedowns, from a 312 million euro profit a year ago. It had already made a 51 million euro provision in the third quarter.

Highlights

* 2008 net loss 10.5 mln euros

* 128 mln euro writedown on raw material inventories

* Revenue down 26.8 pct to 5.05 bln euros 

The global economic crisis has drained demand in recent months, and lower prices for nickel, a key steel ingredient, have hit book values of inventories.

On outlook, Acerinox, one of the world’s top three stainless steel makers, said only that it was optimistic that in the medium and long term demand would return to historic annual growth rates of close to 6 percent.

Recent results from stainless steel producers Outokumpu , ThyssenKrupp  and ArcelorMittal CELR.PA have already shown demand is weak and that market conditions are likely to worsen further before they improve.

Revenue fell 26.8 percent to 5.05 billion euros, missing a forecast of 5.16 billion, while core earnings dropped 60 percent to 300 million.

Acerinox, which has cut output by roughly half at its factories in Spain, South Africa and the United States, said new cost saving measures in a 2009-10 plan would save the company 133 million euros.

Steel production for last year fell 11.5 percent to 2.04 million tonnes, it said.