Profitable growth Håkan Folin CFO

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Roadmap toward industry-leading profitability

Pre-2014

Ruukki merger

Synergies and cost savings of SEK >3bn

Rights issue

Extension of debt maturities

SEK 10bn reduction in net debt by year-end 2017

Growth in Special Steels

Growth in automotive and other premium steels

Growth in service and after market activities

Home market leadership

EBITDA margin > industry peers

Net gearing of <30%

Resume dividend payments at 50% of net profit

Developed the high-strength steel market and entered US plate

Consolidated Nordic home

market presence 2014–2016

Focus on cash-flow and strengthening balance sheet

Profitable growth in selected

market areas

Industry- leading

profitability

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Financial targets

* ArcelorMittal, AK Steel, Nucor, Salzgitter, Tata Steel Europe, ThyssenKrupp, US Steel

Profitability

SSAB aims for an industry-leading profitability measured

as EBITDA-margin among comparable peers*

The Group’s operations are cyclical. The objective is a long-term net debt/equity ratio of

30%

Capital Structure

Dividends are adapted to the average earnings level over a

business cycle and, in the long term, constitute ~50% of profit

after tax, taking into consideration the net debt/equity ratio

Dividends

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Profitability

SSAB aims for an industry-leading profitability measured as EBITDA-margin among comparable peers

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Strong trend in profitability improvement

►Significant improvement in earnings: − Synergies from Rautaruukki

− Cost savings

− Better mix

− Improved market conditions

►Breakdown in Oxelösund and margin pressure in SSAB Americas weighed on earnings in Q4 2016 and Q1 2017

-1,500

-1,000

-500

0

500

1,000

1,500

2,000

2,500

2012 2013 2014 2015 2016 2017*

*2017 refers to 2017 Q1 rolling 12 month

MSEK Operating profit, EBIT

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EBITDA-margin vs. peer group

Adjusted for major non-recurrring items

2015 2016

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-4.4%

2.0%

4.8%

5.4%

5.5%

6.4%

8.2%

11.1%

US Steel

Tata Steel Europe

AK Steel

ThysenKrupp

Salzgitter

SSAB

ArcelorMittal

Nucor

US Steel 3.3%

4.0%

5.5%

6.3%

7.9%

9.1%

12.1%

12.6%

US Steel

Tata Steel Europe

Salzgitter

ThyssenKrupp

AK Steel

SSAB

ArcelorMittal

Nucor

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2020 - Targets

Grow Special Steels 1.35 MTON

2016 Target

1.35

1.0

Enhance premium mix in SSE

Develop SSAB Services

Wearparts members

Leader North American plate

30%

Market share (over time)

Automotive premium 750 KTON

2016 Target

KTON

1 2 3 4 5

442

750 MTON

Share of Premium products

40%

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2016 Target

265

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Industry-leading profitability

Growth in Special Steels

► Higher margin per tonne

► Higher revenue

► Higher margin per tonne

► Further improvement in revenue and earnings – less volatility

► Higher revenue

► Operating leverage from volume

► Product and channel upgrade lifts margin per tonne

Strategic focus P&L impact

Strengthen home market position – local producer close to customer

Growth in services

Mix improvement

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Mix improvement drives profitability – examples

Q&T

Automotive premium Tubular

Standard hot-rolled coil/plate

CTL/slit

Profitability(index)

100

120

140

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Operational leverage – cost structure

SSAB Special Steels

Variable Fixed

SSAB Europe

Variable Fixed

SSAB Americas

Variable Fixed

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Continuous improvements – cost efficiency

Monthly follow-up of KPIs

Continuous improvement in daily work

Improvement projects

Driven by the employees

Large number of efficiency actions across all divisions

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Capital Structure

The Group’s operations are cyclical

The objective is a long-term net debt/equity ratio of 30%

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0

10

20

30

40

50

60

2012 2013 2014 2015 2016 Q1/2017

0

5

10

15

20

25

30

Net interest bearing debt, SEKm Net gearing ratio, %

Stronger balance sheet

►Reduced net debt and lower gearing: − Lower interest cost

− Ability to invest for growth

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Net debt and gearing ratio % MSEK %

Net debt reduction according to plan SEK 10 bn. between the end of Q1/16 and the end of 2017

SEK bn

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10.0

4.9

7.7

Target Remaining in 2017

2.3

2.8

Realized so far Rights issue (net) Net cash flow Q2/16-Q1/17

Reduce working capital to sales

Key focus area in 2017 for all divisions

Large number of actions identified and being

implemented

2017

22%

23%

24%

25%

26%

27%

dec jan feb mar apr may jun jul aug sep oct nov dec jan feb mar

2016 2015

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R12 Working capital / R12 Sales

Investments

► Installed capacity sufficient to reach growth targets for SSAB Special Steels

► Investments kept below depreciation: − SSAB and Ruukki merger

− Major strategic investments in 2010-2012

− Blast furnaces recently relined

►Areas for strategic capex 2017 and going forward: − Automotive premium

− Service expansion

0

500

1,000

1,500

2,000

2,500

3,000

2014 2015 2016 2017 andonwards

Strategic

Maintenance

MSEK

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Investments

Cash flow trend

-0.7

2.2

3.9

1.1

0.5

2.8

2.3

3.1

2010 2011 2012 2013 2014 2015 2016 2017*

Refers to cash flow from current operations in SEK bn.

*2017 refers to 2017 Q1 rolling 12 month

►Strong potential to improve profitability

► Well-invested

►Reduction of working capital/sales

►Lower interest cost

►Tax rate ~20%

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Cash flow from current operations

Dividends

►Dividends are adapted to the average earnings level over a business cycle and, in the long term, constitute ~50% of profit after tax, taking into consideration the net debt/equity ratio.

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Dividend

-3.00

-2.50

-2.00

-1.50

-1.00

-0.50

0.00

0.50

1.00

1.50

2012 2013 2014 2015 2016

Earnings per share Dividend per share

SEK

Target to resume dividend

Weak market conditions

Rights issue

Focus on net debt reduction

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Earnings and dividend per share

Summary

►Top-line growth driven by high-strength steels

►Home market leadership, growth and mix improvement will support Group profitability

►Well-invested to achieve targets

►Several initiatives to improve operational performance

►Reduction of net debt according to plan

►Towards industry-leading profitability

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