Ferrexpo plc, a mining company with its main assets in Ukraine, reduced capital investments by 49.1% in January-June this year compared to the same period last year, from $55 million to $28 million.
According to the company’s interim report on Wednesday, of the total amount spent in the first half of 2025, capital expenditures for maintenance and modernization amounted to $15 million (in the first half of 2024 – $19 million), covering the activities of all the group’s main business units.
It is also reported that investments in strategic development projects in the reporting period amounted to $13 million (in the first half of 2024 – $36 million).
In total, 55% of capital investments were directed to supporting projects and 45% to development.
It is specified that the largest strategic capital investments included additional funds for a new press filtration complex and a new concentrate conveyor line, which amounted to $5 million and $3 million, respectively.
The aim of these projects is to increase the production of high-quality iron ore products so that the business can make its production portfolio more flexible and adapt to short-term changes in demand for various products.
The Group also funded $2 million for development work for future production and $1 million for the development and exploration of the Belanivsky deposit.
Given the decline in cash flow generation, no ordinary dividends were declared or paid during the first half of fiscal years 2025 and 2024.
The group has a shareholder return policy that sets out the group’s intention to pay up to 30% of free cash flow as dividends for a given year. The group’s ability to pay dividends also depends on developments in ongoing litigation in Ukraine, the report said.
As reported, Ferrexpo maintained its capital investments in 2024 at the previous year’s level of $101.688 million (in 2023 – $101.247 million, in 2022 – $161.010 million, and $361 million in 2021). In particular, capital expenditures for maintenance and modernization in 2024 amounted to $37 million (in 2023 – $31 million, in 2022 – $57 million, and in 2021 – $113 million). At the same time, the group reviewed the timing of investments in strategic development projects, resulting in expenditures of $65 million compared to $70 million in 2023.
Some of the larger capital expenditures included additional funds for a new press filtration complex and a new concentrate conveyor line along the production circuit, which amounted to $24 million and $2 million, respectively. These investments will enable the group to increase production of high-quality products in the near term when production returns to full capacity and to produce iron ore concentrate and pellets simultaneously.
In addition, the group spent $9 million in 2024 (2023: $22 million) on stripping work for future production growth and $18 million on a concentrator and pelletizer project (2023: $22 million) as part of the first wave (Wave 1) of the production expansion program.
The group also spent $3 million on the development and exploration of the Belanivskoye deposit (2023: $3 million) and $1 million on a hydrolysis plant (2023: $1 million) to test the use of hydrogen as fuel in the group’s granulator.
Ferrexpo is an iron ore company with assets in Ukraine. Ferrexpo owns 100% of Poltava Mining, 100% of Yeristovo Mining, and 99.9% of Bilanivsky Mining.
