HELSINKI (AFP) - Finnish stainless steel manufacturer Outokumpu issued a profit warning Tuesday, saying it expected its underlying fourth-quarter operating results to be negative instead of breaking even.

The company said in a statement it blamed continued economic uncertainty and lower-than-expected delivery volumes and prices.

"Additionally, Outokumpu's actions to reduce inventories have resulted in cost increases, which have had a negative impact on profitability," it said.

In October, company CEO Juha Rantanen said he foresaw fourth-quarter results improving to the break-even point compared to a disappointing third quarter, when the company posted a loss of 56 million euros (78.2 million dollars).

Now the company says that it expects its operating profit to be clearly negative in the fourth quarter as well.

However, the company sees some optimism for the beginning of 2011.

"Currently, prices have stabilised and there is potential to increase prices for deliveries in the first quarter 2011," it said.