Iron ore pellet maker Ferrexpo Plc warned on Wednesday that slower demand from steelmakers would hit sales in 2008 and said its chief executive had resigned, sending its shares as much as 24 percent lower, according to Reuters.
The Swiss-based group said a number of its export contract customers had asked it to defer some deliveries planned for the fourth quarter of 2008 into 2009, due to significantly reduced steel demand and output.
London-listed Ferrexpo, which mines iron ore in Ukraine and turns it into pellets for sale to steel producers, said the deferrals would result in a significant increase in unallocated production in the current year.
"The group estimates this slowdown in demand will have a negative impact of around 5 percent to 10 percent of its expected sales for the full year in 2008," the company said in a trading statement.
In a separate statement, Ferrexpo said Chief Executive Mike Oppenheimer and business development director Dennis McShane were resigning because they felt their roles had changed following a decision to put the company`s expansion strategy on hold.
The group said Ukrainian business tycoon Kostyantin Zhevago, who controls Ferrexpo`s majority shareholder Fevamotinico S.a.r.l., would take over as chief executive.
The company said it expected to face a more challenging environment in the coming months.
"As a result, the board has resolved to hold all strategic initiatives in abeyance in the medium term and refocus the group`s activities on ensuring the continuing strength of its existing operations in Ukraine."
Shares in Ferrexpo were 17 percent lower at 44 pence by 1051 GMT having earlier fallen as low as 40.15 pence.