March 6, 2014 / 7:05 AM / 4 years ago

UPDATE 1-Germany's Kloeckner sees return to profit this year

* Kloeckner sees 2014 net profit, aims to pay dividend

* Earnings to be bolstered by restructuring, Riedo deal

* 2013 net loss 85 mln euros vs 200 mln year before

* Sees Q1 EBITDA growing to 40-50 mln euros vs 29 mln (Recasts, adds 2013 net loss, analyst estimates for 2014, background)

By Maria Sheahan

BERLIN, March 6 (Reuters) - German steel distributor Kloeckner & Co said it was on track to return to profit this year and pay its shareholders their first dividend in four years as it slashes costs.

Like other companies in the sector, Kloeckner was hit by a slump in demand for steel in Europe as government spending cuts and tight credit conditions hurt demand for cars, buildings and household appliances.

It is cutting more than 2,200 jobs and shutting a quarter of its sites around the world to slash costs, which it has said means going down to “bare bones” in some areas.

Kloeckner said on Thursday its net loss narrowed to 85 million euros from 200 million last year and said it should turn to profit this year, thanks to cost cuts and the acquisition of Swiss reinforcing steel specialist Riedo Bau + Stahl, announced earlier this week.

That should allow the company to pay a dividend for 2014, Kloeckner said. Analysts expect Kloeckner to post a 2014 net profit of 27 million euros ($37.1 million) and pay a dividend of 0.10 euros.

“Likewise we are optimistic for the years beyond,” Kloeckner aid.

In the current quarter through March, it said it saw its earnings before interest, tax, depreciation and amortisation improving to between 40 million euros and 50 million from 29 million a year earlier, but did not provide guidance for its quarterly net result.

$1 = 0.7278 euros Editing by Christoph Steitz and David Holmes

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