Ferrexpo plc, a mining company with its main assets in Ukraine, delivered 60% of its iron ore raw materials (IORM) by sea in January-June 2025, 35% by rail, and 5% by river barges.
According to the company’s interim report on Wednesday, the group continued to take advantage of its access to Ukrainian Black Sea ports to export products by sea to Asia, the Middle East, and North Africa, as well as Europe, which prefer sea transport over rail or river barges. A total of 60% of sales were exported by sea during this period, compared with 53% in the previous six months and 47% in the same period of 2024.
It is reported that a total of 16 vessels were loaded with Ferrexpo products from Ukrainian ports during the half-year. Of the total sales, 50% went to Asian customers, 38% to European customers, and the remaining 12% to customers in the Middle East and North Africa.
Overall, seaborne sales remained stable at 2.1 million tons. Sales volumes increased compared to previous half-years, although they remained unchanged compared to the same period in 2024.
However, the Fe (65%) iron ore index declined by 10% during this period, resulting in revenue of $453 million, up 18% compared to the previous six months and down 17% compared to the same period last year ($549 million), when iron ore prices were significantly higher.
Total sales volume amounted to 3.8 million tons, including pellets and concentrate, which is 28% more than in the second half of 2024, but 1% less than in the first half of 2024.
During the reporting period, the Group reduced its production cost by 2.2% under C1 to $77.1/tonne (in the first half of 2024 – $78.8/tonne) due to reduced mining activities, lower fuel prices, lower maintenance costs, and lower personnel expenses. The main factors affecting C1 costs are electricity, natural gas, and diesel fuel prices. The Group continued to experience sharp increases in electricity prices due to the existing weakness of electricity generation and distribution capacities in Ukraine as a result of ongoing Russian attacks.
It should be noted that the Group’s business is energy-intensive, and the main components of C1 expenses are electricity, gas, and diesel fuel, which together account for 49% (45% in the first half of 2024) of total expenses. In particular, in January-June 2025, the share of electricity costs in C1 costs increased to 34% (first half of 2024 – 27%), and the share of natural gas – to 9% (first half of 2024 – 7%).
The price of iron ore with a 65% benchmark declined during the first half of 2025, closing $11 lower at $104/ton. In July, iron ore prices recovered slightly, with the average price for 65% Fe at $116/tonne in the last week of July, 12% higher than at the beginning of the month.
During the first half of the year, the group operated two of its four pelletizing lines in the first quarter and one line in the second quarter, as well as a specialized concentrate line.
Commenting on the group’s performance, interim CEO Lucio Genovese noted that from January to April 2025, the company was denied VAT refunds of $31.1 million, and by the end of June, this amount had reached $38.3 million.
With the exception of lease obligations, the group has no outstanding loans or borrowings bearing interest, so no interest expenses were incurred on financial lines. The group has minimal financial debt of $2 million.
Ferrexpo owns 100% of Yeristovsky GOK LLC, 99.9% of Bilanovsky GOK LLC, and 100% of Poltava GOK PJSC.
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.
Mining company Ferrexpo plc, with its main assets in Ukraine, ended January-June this year with a net loss of $196.004 million, compared with a net profit of $55.490 million in the same period last year.
According to the company’s interim report on Wednesday, the pre-tax loss for the period was $186.899 million, compared with a pre-tax profit of $75.671 million in January-June 2024.
Revenue in the first half of 2025 decreased by 17.5% to $452.607 million. At the same time, EBITDA amounted to $3.890 million compared to $79.043 million at the end of June 2024 and $69.310 million at the end of 2024.
Cash and cash equivalents at the end of June 2025 amounted to $52.262 million, at the end of June 2024 – $115.131 million, and at the end of 2024 – $105.919 million.
The report states that the group’s underlying EBITDA remained positive at around $4 million for the first half of 2025, despite losses for the period, although this is significantly lower than for the same period in 2024. The sharp decline was mainly due to lower operating profit as a result of an adjusted lower production plan following the refusal to refund VAT in Ukraine and lower realized prices, which could not be offset by the effects of lower C1 production costs and further cost-cutting measures initiated by the group during the second quarter of 2025.
Commenting on the group’s performance, interim CEO Lucio Genovese noted that the company started the year on a strong footing, with its best quarterly production since the full-scale invasion of Ukraine in February 2022. However, this momentum was significantly curtailed in the second quarter as the group was forced to reduce its activities due to the decision by the Ukrainian tax authorities to suspend VAT refunds to its subsidiaries. This is reflected in a 40% drop in production in the second quarter compared to the first quarter.
“We quickly took steps to reduce our costs. We have now had to reduce working hours or send approximately 40% of our employees on leave. We have also implemented programs to optimize the speed of disclosure, repair, and maintenance, and have reduced non-essential expenses across the business. These actions were necessary and mitigated the serious negative impact of the suspension of VAT refunds. We have managed to reduce our costs as much as possible to remain competitive in the face of low iron ore prices,” Genovese said.
He added that since the full-scale invasion of Ukraine in February 2022, Ferrexpo has continued to operate and export its products despite the enormous challenges caused by the war.
As reported, Ferrexpo posted a net loss of $50.03 million in 2024, down 41% from $84.753 million in 2023. Revenue for 2024 amounted to $933.263 million, compared to $651.795 million in 2023 (an increase of 43.2%). EBITDA amounted to $69.310 million, compared to $98.871 million adjusted for 2023. Cash and cash equivalents at the end of 2024 amounted to $100.835 million, compared to $108.293 million at the end of 2023, $106.397 million in 2022, and $117 million at the end of 2021.
Ferrexpo ended 2023 with a net loss of $84.753 million compared to a net profit of $219.997 million in 2022, which is four times lower than the profit in pre-war 2021 ($870.993 million). Revenue for 2023 amounted to $651.795 million, compared to $1 billion 248.490 million in 2022 (a decrease of 47.8%). At the same time, EBITDA fell by 83% to $130.242 million compared to $765.113 million in 2022.
Ferrexpo owns 100% of Yeristovsky GOK LLC, 99.9% of Bilanovsky GOK LLC, and 100% of Poltava GOK PJSC.
Ferrexpo plc, a mining company with its main assets in Ukraine, produced 2,169,631 tons of pellets in January-June this year, which is 34.2% less than in January-June last year (3,297,441 tons).
According to the company’s press release on Monday, total production of commercial products (pellets and iron ore concentrate) in the first half of 2025 decreased by 9% compared to the first half of 2024, to 3 million 393,135 thousand tons. In particular, the output of marketable concentrate amounted to 1 million 223.504 thousand tons against 429.865 thousand tons, respectively. The company also produced 81,787 thousand tons of DR pellets (in the first half of 2024 – 162,645 thousand tons) and 2 million 87,844 thousand tons of premium pellets (a decrease of 33.4%).
The press release notes that from January to April 2025, the amount of VAT refunds denied amounted to $31 million. Due to the current suspension of VAT refunds and the associated decline in financial liquidity, the group was forced to reduce production from two to one pelletizing line and also to reduce the production of high-quality concentrate. As a result, total commercial production for the second quarter amounted to 1.3 million tons, down 40% from 2.1 million tons in the first quarter.
However, the group demonstrated flexibility and agility by continuing to benefit from strong demand for its concentrate from customers in China, which accounted for more than a third of its product mix in the first two quarters of 2025, the statement said.
Among other things, it has made efforts to reduce its costs in order to remain financially viable. This includes reducing working hours for employees, cutting purchases of goods and services, and suspending all non-essential capital expenditures, overhead costs, and corporate social responsibility expenses.
Commenting on the group’s performance, interim CEO Lucio Genovese noted that the strong momentum at the beginning of the year, which reflects, in particular, increased quarterly production since the full-scale invasion in February 2022, was significantly limited in the second quarter as the company began to feel the impact of tax authorities’ decisions to suspend VAT refunds. As a result, production fell to 1.3 million tons in Q2 2025.
“Despite the weaker iron ore pellet market, we were able to significantly change our production portfolio and take advantage of strong demand in China for our high-quality low-alumina iron ore concentrates. During the first six months of 2025, concentrate sales accounted for 36% of our production portfolio, three times more than in the same period a year ago. In a challenging operating and market environment for iron ore, it is encouraging that we have been able to be so flexible and take advantage of the demand for high-quality concentrates,” said the top manager.
At the same time, he pointed out that lower iron ore prices and reduced production had a negative impact on profitability. The situation was exacerbated by higher prices for raw materials such as gas and electricity. During the second quarter, the group worked hard to reduce its costs in order to remain financially viable.
“This includes reducing working hours or leave for approximately 37% of employees, reducing purchases of goods and services, and suspending all non-essential capital expenditures, CSR, and humanitarian expenditures. At the same time, every effort is being made and measures are being taken with the relevant authorities and government agencies in Ukraine and internationally to try to resolve the issue of the suspension of VAT refunds,” Genovese added.
As reported, Ferrexpo produced 1 million 347,749 thousand tons of pellets in Q1-2025, which is 26% lower than in January-March last year (1 million 813,973 thousand tons). At the same time, total production of commercial products (pellets and iron ore concentrate) in Q1 2025 increased by 3% compared to Q1 2024, to 2 million 125.467 thousand tons. In particular, the output of marketable concentrate amounted to 777,718 thousand tons, compared to 240,516 thousand tons in Q1-2024. The company also produced 81,879 thousand tons of DR pellets (not produced in Q1-2024), 1 million 105.049 thousand tons of premium-grade pellets (a decrease of 36%) and 160.913 thousand tons of other pellets (an increase of 95%).
In 2024, Ferrexpo increased its production of pellets by 58% compared to 2023, to 6 million 70.541 thousand tons from 3 million 845.325 thousand tons. In the fourth quarter of 2024, it produced 1 million 503.373 thousand tons of pellets, which is 18% higher than in the previous quarter (1 million 269.727 thousand tons).
At the same time, total production of marketable products (pellets and iron ore concentrate) in 2024 increased by 66% compared to 2023, to 6 million 889.879 thousand tons from 4 million 152.028 thousand tons. In particular, the output of marketable concentrate reached 819,338 thousand tons compared to 306,703 thousand tons in 2023. The company also produced 489,720 thousand tons of DR pellets, 4 million 984,990 thousand tons of premium pellets, and 595,831 thousand tons of other pellets.
In 2023, Ferrexpo produced 3.845 million tons of pellets, which is 36.5% less than in 2022.
Ferrexpo owns 100% of Yeristovsky GOK LLC, 99.9% of Bilanivsky GOK LLC, and 100% of Poltavsky GOK PJSC.
In 2024, Ferrexpo, a mining company with assets in Ukraine, increased its total sales of iron ore products by 64% year-on-year to 6.8 million tons, and by 26% to Europe, to 5.3 million tons.
According to the company’s annual report, sales grew mainly due to the reopening of Ukrainian Black Sea ports, which enabled the group to increase sales to customers in the Middle East and Asia using larger vessels, as well as to switch some sales to European customers from more expensive rail and barges to lower-cost sea routes.
It is also noted that last year, the company’s relations with premium European customers deepened with the signing of several memorandums of understanding to explore the sale of DR pellets (direct reduced iron), improve the quality of pellets and study the decarbonization of logistics routes. Memorandums of understanding were also signed with customers in Asia and MENA.
In 2025, the company intends to continue exporting its products from Ukrainian Black Sea ports as long as it is safe and economically viable, meaning that while Europe remains the main regional market, the group will also continue to sell to China and other Asian countries, as well as to its growing customer base in MENA.
According to the report, despite numerous logistical challenges, including the transportation of goods in the Odesa region, the company managed to ensure a stable transportation process during 2024. 84% of all domestic rail transportation was carried out by the group’s own railcar fleet, and 16% was carried out by third-party operators.
According to Viktor Lotous, Chairman of the Board of Poltava Mining and Head of Ferrexpo’s operations in Ukraine, our own repair facilities played an important role in ensuring uninterrupted transportation. The company’s existing facilities fully cover the needs for maintenance, repair and re-equipment of railcars, which reduces dependence on third-party contractors and ensures a high level of rolling stock availability.
An important factor that may affect future costs is the initiative of UZ to index tariffs, which is likely to increase transportation costs. Ferrexpo is closely analyzing the potential impact of this decision, considering ways to minimize costs, Lotous emphasized in the report.
He also informed that mining operations at Bilanivsky GOK were suspended due to the expiration of the license on December 20, 2024, but due to the extension of martial law in Ukraine, the validity of the Special Permit No. 3572 for Bilanivsky deposit was automatically extended until the end of martial law (May 9, 2025). It is assumed that another six months will be available to apply for an extension.
According to him, in early 2024, the reserves estimate of the Belanivske field was updated, and the results were approved by the State Commission on Mineral Resources. According to the results of the license revaluation, the area of the Belanivske deposit was reduced from 989 to 716 hectares, the area of the Belanivske contour of the deposit was reduced, poor ores were written off, and the balance sheet mineral reserves were reduced from 1706 million tons to 614 million tons. In February 2025, the company received an updated special permit No. 3572 for the Belanivske deposit.
The company continues to cooperate with government agencies to extend the license for the Belanivske field due to the extension of martial law and amendments to the Subsoil Code of Ukraine to ensure the possibility of extending the special permit.
The CEO also said that programs to increase ore production and decarbonization remain long-term goals. The initial first wave program to increase production capacity by 3 million tons per year is currently under review.
“Desktop work, including optimization studies, is ongoing. However, wherever possible, investments have been postponed. Nevertheless, despite the ongoing war, various capital expenditure projects are aimed at improving product quality and efficiency. For example, the company has introduced a pelletizing technology at the pelletizing plant to strengthen finished pellets, while increasing productivity and reducing iron losses to save costs and reduce emissions,” Lotus stated.
As reported earlier, Ferrexpo lost a case in the Supreme Court to reinstate one of its licenses for exploration of the Galeshchyna (Kremenchuk) ferruginous quartzite deposit after Bilanivsky GOK was sanctioned.
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 GOK.
Ferrexpo plc, a mining company with major assets in Ukraine, produced 1 million 347.749 thousand tons of pellets in January-March this year, down 26% year-on-year (1 million 813.973 thousand tons).
According to the company’s press release on Monday, the total production of marketable products (pellets and iron ore concentrate) in 1Q2025 increased by 3% compared to 1Q2024 to 2 million 125.467 thousand tons. In particular, the production of iron ore concentrate amounted to 777,718 thousand tons compared to 240,516 thousand tons in 1Q2024. The company also produced 81,879 thousand tons of DR pellets (not produced in Q1-2014), 1 million 105,049 thousand tons of premium pellets (down 36%) and 160,913 thousand tons of other pellets (up 95%).
The press release notes that during the quarter, the group operated two pelletizing lines (out of four) in addition to producing commercial concentrate, however, due to the recently announced suspension of VAT refunds, operations were reduced to one line.
Commenting on the group’s performance, Lucio Genovese, interim CEO, stated that in the first quarter of 2025, total commercial production was the highest quarterly figure since the start of the full-scale invasion in February 2022. This is due to increased production of high-grade concentrates sold to customers in Asia, combined with stable production of premium products. We
“The increase in production, however, did not translate into improved earnings due to persistently high production costs, in particular imported electricity, and deteriorating premiums and prices for iron ore pellets. The environment in which we operate is becoming increasingly challenging. In March, the Ukrainian tax authorities announced their decision to suspend VAT refunds for January 2025 to our two main operating subsidiaries, PGOK and Yenakiieve Iron Ore Enrichment, in the total amount of UAH 512.9 million (approximately $12.5 million). This suspension of VAT refunds, which is significant, resulted in a decrease in available liquidity to finance operations. This has forced us to immediately reduce our operations to one pellet production line and implement significant cost-cutting measures across the business, impacting labor, mining and processing, repair and maintenance, capital expenditures, and humanitarian and social funding,” Genovese emphasized.
According to him, this will have a broader impact on the economic and social fabric of the 50,000-strong city of Horishni Plavni, where the company is the main employer, and the Poltava region and the 3,000 small and local businesses that depend on Ferrexpo. It will also have an impact on the national economy through reduced taxes and fees, payments to suppliers, including energy suppliers, UZ and ports.
“We continue to appeal to the Ukrainian government and other stakeholders to restore VAT refunds so that we can maintain our business at higher operating levels, support our workforce and the integrity of our operations,” the top manager emphasized.
As reported earlier, Ferrexpo increased pellet production by 58% in 2024 compared to 2023, up to 6 million 70.541 thousand tons from 3 million 845.325 thousand tons. In the fourth quarter of 2024, the company produced 1 million 503.373 thousand tons of pellets, up 18% quarter-on-quarter (1 million 269.727 thousand tons).
At the same time, the total production of marketable products (pellets and iron ore concentrate) in 2024 increased by 66% compared to 2023, to 6 million 889.879 thousand tons from 4 million 152.028 thousand tons. In particular, the production of salable concentrate amounted to 819,338 thousand tons compared to 306,703 thousand tons in 2023. The company also produced 489,720 thousand tons of DR pellets, 4 million 984,990 thousand tons of premium pellets and 595,831 thousand tons of other pellets.
In 2023, Ferrexpo produced 3.845 million tons of pellets, which is 36.5% less than in 2022.
Ferrexpo owns a 100% stake in Yeristovo Mining, 99.9% in Bilanivsky GOK and 100% in Poltava Mining.
