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November, 24th 2017

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NOV 09
14:11

Higher prices to partially offset shipment decline: MMK

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MMK says higher average sales prices will partially offset reduced shipments to the domestic market in the fourth quarter amid a seasonal slowdown of business.

The Russian steelmaker’s consolidated revenue rose 4.5% on-quarter in the third quarter to $2.01 billion due to increased shipments and a recovery in domestic sales. Ebitda increased 17.1% to $533 million. This was in line with the firm’s expectations (see Kallanish 16 October). The Russian and Turkish segments, with 19.5% and 77.8% Ebitda growth respectively, drove the Q3 Ebitda improvement.

Consolidated profit for the period, however, fell -7.1% to $276m. This was due to a high base effect in the previous quarter, which had been positively influenced by profit from recovery of provision for construction in progress and for recultivation, according to MMK.

The Russian segment’s revenue rose 4.7% in Q3 to $1.91 billion due to an 11.2% increase in shipments against the backdrop of a stronger rouble. Ebitda grew to $497m due to increased higher value-added product sales and lower production costs.

Consolidated revenue in the nine months through September increased 37.2% on-year to $5.6 billion. Ebitda shrunk -4% to $1.44 billion and net profit fell -9.9% to $814m.

Nine-month finished steel sales inched up 0.7% on-year to 8.55 million tonnes (see Kallanish passim).