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STOCKHOLM, July 20 (Reuters) - Swedish steelmaker SSAB missed second-quarter operating earnings expectations on Friday due to a smaller-than-expected boost from soaring U.S steel prices.
The company is one of the largest steel plate producers in the United States, while it still generates the majority of its profits in Europe.
Steel prices in the United States have jumped this year, with U.S. NYMEX hot rolled coil futures up by roughly 40 percent, fuelled by steel import tariffs.
Local production accounts for around 90 percent of SSAB’s shipment volumes in the United States.
“Contract prices and lead times mean a certain delay before these higher prices are reflected in SSAB Americas’ earnings,” the company said.
It reported a rise in quarterly operating profit to 1.63 billion Swedish crowns ($108.8 million) from 1.21 billion a year earlier, but missed the 1.82 billion crowns expected by analysts in a poll.
“Despite the political turbulence surrounding trade barriers, we expect the outlook to remain good for the second half of 2018”, SSAB said.
SSAB shares are down 0.9 percent this year, outperforming a 10 percent drop in the Thomson Reuters Europe Steel Index .
The company expected higher realised prices during the third quarter for SSAB Americas and its Special Steels unit, but forecast little change in prices for SSAB Europe.
It forecast strong heavy plate demand in North America in the third quarter, while a seasonal slowdown was expected for Europe. (Reporting by Johannes Hellstrom; editing by Niklas Pollard and Jason Neely)
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