Metinvest, the largest Ukrainian mining and metallurgical holding, in January-June this year increased crude steel production by 10% compared to the same period last year, to 4.358 million tonnes, cast iron – by 8%, to 4.405 million tonnes, but reduced total coke production by 0.2%, to 2.368 million tonnes.
According to a press release of parent company Metinvest B.V. on the results of operation in H1 2021 published on Wednesday, In 2Q 2021, Metinvest’s hot metal output climbed by 5% q-o-q to 2.254 million tonnes. This was driven by growth in Azovstal’s production of 107,000 tonnes following brief maintenance and repair work on blast furnaces in March because of the planned overhaul of basic oxygen furnace (BOF) No. 1 that month.
In 2Q 2021, the Group’s crude steel output rose by 5% q-o-q to 2.229 million tonnes because of an increase in Azovstal’s volumes of 130,000 tonnes amid greater hot metal production at the plant. Meanwhile, Illich Steel’s output decreased by 30,000 tonnes because of the scheduled overhaul of BOF no. 3 in May.
In H1 2021 hot metal and steel output grew thanks to an increase in production at the two Mariupol-based works.
In 2Q 2021, the Group’s output of merchant semi-finished products dropped by 10% q-o-q to 687,000 tonnes. Merchant slab production fell by 91,000 tonnes because of the allocation of slabs to make more flat products. Meanwhile, pig iron output edged up by 13,000 tonnes.
In 1H 2021, Metinvest’s production of merchant semi-finished products decreased by 4% y-o-y to 1.452 million tonnes. Merchant slab production declined by 131,000 tonnes because of the redistribution of slabs to flat product rolling. Pig iron production rose by 66,000 tonnes, mainly because of an increase in hot metal output.
In 2Q 2021, the Group’s output of finished products climbed by 9% q-o-q to 1.819 million tonnes.
In 1H 2021, Metinvest’s production of finished products surged by 22% y-o-y to 3.481 million tonnes.
In 2Q 2021, the Group’s coke output totalled 1.198 million tonnes, up 2% q-o-q, mainly because of an increase in production at Avdiivka Coke following the overhaul of coke oven battery No. 6 in the beginning of this year. In 1H 2021, coke output remained flat y-o-y at 2.368 million tonnes. The effect of the consolidation of production volumes of Dnipro Coke since April 2020 (124,000 tonnes) was almost completely offset by decreases in production at Avdiivka Coke of 81,000 tonnes and Azovstal of 46,000 tonnes.
The revenue of Metinvest B.V. (the Netherlands), the parent company of Metinvest mining and metallurgical group, in May this year increased by 0.9%, or $ 14 million, compared to the previous month, to $ 1.569 billion from $ 1.555 billion.
According to the unaudited consolidated monthly results of the company’s financial statements, total EBITDA in May was $ 752 million, which is $ 102 million, or 15.7%, more than in April ($ 650 million). At the same time, EBITDA from participation in the joint venture amounted to $ 147 million (in April – $ 101 million).
According to the report, the adjusted EBITDA of the metallurgical division of the group for May 2021 amounted to “plus” $ 367 million, including $ 46 million from participation in the joint venture; EBITDA of the mining division – $ 460 million, including from the joint venture – $ 101 million. The management company spent $ 5 million.
Total revenue in May consisted of $ 1.244 billion of the metallurgical division and $ 583 million of the mining division. Intragroup sales were $ 258 million.
The total debt of Metinvest in May decreased by $ 247 million compared to April, to $ 2.925 billion from $ 3.172 billion. At the same time, the volume of funds increased by $ 35 million, to $ 1.239 billion from $ 1.204 billion.
Funds used in investment activities amounted to $ 43 million, in financial activities – $ 251 million.
In May, the group sold 1.474 million tonnes of iron ore for $ 308 million, 59,000 tonnes of coal concentrate for $ 8 million.
The main shareholders of Metinvest are SCM Group (71.24%) and Smart Holding (23.76%), which jointly manage it.
Metinvest Holding LLC is the management company of Metinvest Group.
Metinvest Mining and Metallurgical Group through PrJSC Dniprovsky Coke and Chemical Plant (DKHZ, Kamianske, Dnipropetrovsk region), part of the group, will acquire an integral property complex of Dniprovsky Integrated Iron & Steel Works (DMK, Kamianske, Dnipropetrovsk region) for UAH 9.17 billion with a starting price of UAH 8.395 billion.
According to the information on the ProZorro.Sales platform, bids were accepted until July 25 inclusive, the auction was scheduled for July 26, but since one bid was submitted for the competition, the winner was determined without bidding.
Earlier, Interfax-Ukraine was informed that Metinvest would acquire DMK through its company, DKHZ.
DMK was undergoing reorganization as part of the bankruptcy proceedings of the enterprise.
Revenue of Metinvest B.V. (the Netherlands), the parent company of an international vertically integrated group of steel and mining companies Metinvest, in April this year increased by 12.9%, or $178 million, compared to the previous month, to $1.555 billion from $1.377 billion. According to the published preliminary unaudited consolidated monthly results of the company’s financial statements on Wednesday, total EBITDA in April was $650 million, which is $69 million, or 11.9% more than in March ($581 million). At the same time, EBITDA from participation in the joint venture amounted to $101 million (in March – $95 million).
According to the report, adjusted EBITDA of the metallurgical division of the group for April 2021 amounted to “plus” $313 million (in March – “plus” $233 million), including $34 million from participation in the joint venture ($13 million); EBITDA of the mining division – $399 million ($402 million), including from the joint venture – $66 million ($82 million). The management company spent $7 million ($7 million).
The total revenue in April consisted of the revenue of the metallurgical division in the amount of $1.189 billion (in March – $1.045 billion), and the mining division – $563 million ($513 million). Intragroup sales were $197 million ($182 million).
The total debt of Metinvest in April decreased by $101 million compared to March, to $3.172 billion from $3.273 billion, whiles cash and cash equivalents increased by $234 million, to $1.204 billion from $970 million.
Net cash used in investing activities amounted to $60 million, and in financing activities – $156 million.
Metinvest received $46 million from the resale of square billets produced by (Dniprovsky Iron and Steel Works of ISD Corporation) in April in the amount of 75,000 tonnes. In addition, $218 million were received from the resale of 272,000 tonnes of flat-rolled products, 80,000 tonnes of long products – $58 million, and 115,000 tonnes of cast iron – $70 million.
In general, the company in April sold 440,000 tonnes of semi-finished products for $277 million, 967,000 tonnes of finished metal products for $786 million, and 183,000 tonnes of coke for $58 million.
In April, the group sold 1.779 million tonnes of iron ore for $333 million, and 178,000 tonnes of coal concentrate for $22 million.
The main shareholders of Metinvest are SCM Group (71.24%) and Smart-Holding (23.76%), jointly managing the company.
Metinvest Holding LLC is the management company of Metinvest Group.
Metinvest, an international vertically integrated group of mining and metals companies, signed a memorandum of cooperation with K1-MET, a leading Austrian research center in metallurgy, to implement joint projects aimed at reducing greenhouse gas emissions in the steel industry in line with the European Green Deal.
As part of its long-term vision to develop emissions-free steelmaking, Metinvest plans to increase the sustainability of its production facilities and is interested in gaining experience of leading technologies aimed at reducing environmental footprint. Meanwhile, К1-МЕТ has profound experience and expertise regarding the implementation of research and development projects focusing on energy efficiency, the circular economy, carbon capture, storage and usage, climate-neutral metal production and other related areas in collaboration with leading industrial players, research organizations and institutes.
Yuriy Ryzhenkov, CEO of Metinvest, pointed to the group’s awareness of the urgent need to reduce the negative impact of metallurgical production on the environment.
“Metinvest is constantly looking at various technological solutions to reduce its emissions today and in the future. The partnership with K1-MET represents an important part of a comprehensive approach to decarbonizing the steel industry in the long run, and we will continue to actively explore this and other areas,” he said.
In turn, Thomas Buergler, CEO of K1-MET, said that the decision of the 2015 climate conference in Paris to limit the global temperature increase to 1.5 degrees Celsius by 2100 compared with the pre-industrial period, and the EU Green Deal 2019, which aims to make Europe a carbon-neutral continent in 2050, highlight great challenges for resource-intensive industry.
“The focus of the research and development programme at the K1-MET metallurgical competence centre is aligned with the climate targets, sustainable development goals and needs of our industrial partners,” the General Director said.
The projects combine carbon-neutral technologies, the circular economy and digitalization for sustainable steelmaking. Strategic research will also be increasingly considered to gain a deeper understanding of process flows. At K1-MET, the interaction of industrial and scientific partners helps to ensure that results from applied research can be transferred to industrial applications. The partnership with Metinvest based on the memorandum signed sets the course for this.
K1-MET (Austria) is one of the leading and internationally renowned metallurgical competence centres for ferrous and nonferrous metallurgy. It cooperates with established national and international partners from the sector to cover issues such as energy efficiency, the circular economy and carbon-neutral metal production. K1-MET and its partners are working on process solutions to advance the transformation of the European metallurgical industry.
AUSTRIAN RESEARCH CENTER, CARBON FOOTPRINT, COOPERATION, METINVEST
Metinvest, an international vertically integrated mining and metallurgical group of companies, will act as the general partner of the international forum “Decarbonization of the Steel Industry: a Challenge for Ukraine,” which will be held in Kyiv on July 14, 2021.
According to the company’s press release, an event on the topic that has been discussed by the entire international community in recent years will be held in Ukraine for the first time.
As noted, for many years of operation, Metinvest has been striving to reduce the negative impact of production on the environment. Over the past 10 years, the group has allocated more than $ 3.4 billion for environmental initiatives and is committed to further reducing its carbon footprint to combat climate change.
Meanwhile, achieving carbon neutrality will be a big challenge for Ukrainian companies, as it involves a complete change in production processes and supply chains. In addition, the necessary technologies that will make the country’s economy carbon-free are only at the research stage. To develop a detailed roadmap for the transition to a “green” industry requires interaction between manufacturers, engineering companies, consumers, suppliers and the government.
Yuriy Ryzhenkov, the director general of Metinvest, stressed that the industry is facing a serious task that will affect the life of the entire country.
“Decarbonization can completely change both production and technologies. The sooner business and the state develop a unified approach to achieving carbon neutrality, the easier this process will be for the Ukrainian economy,” the top manager stated.
The forum is organized by GMK Center, an information-analytical and consulting company working in the field of metallurgy and industry. At the forum it is planned to discuss issues related to decarbonization of steel production, existing and promising technologies, plans of companies to reduce CO2 emissions and interaction with the state in this direction. The event will be attended by the representatives of mining and metallurgical companies, international engineering, consulting and R&D companies, as well as government officials, business associations and industry experts.
