Consolidated revenue of Metinvest B.V. (the Netherlands), the parent company of the international vertically integrated mining and metallurgical group Metinvest, in January-March this year increased by 43% compared to the same period last year, to $3.624 billion.
According to the published preliminary unaudited consolidated results of the company’s financial statements, adjusted EBITDA for the first quarter was $1.462 million, which is 3.92 times higher than in the same period last year ($373 million). The margin was 40% (15% in Q1, 2020).
It is noted that Metinvest’s consolidated revenues rose by 43% which is driven primarily by higher selling prices of steel and iron ore products in line with global benchmarks. In addition, the Group increased sales volumes of flat products by 6% y-o-y, as a result of a recovery in demand in several strategic markets for the Group, as well as recently implemented investments.
Metinvest also boosted pellet shipments by 34% y-o-y, amid higher pellet premiums globally.
During the reporting period, revenues in Ukraine increased by 30% y-o-y, to $947 million. This was mainly due to higher average selling prices of steel and iron ore products, as well as higher sales volumes of iron ore products (up 17%) and coke (up 18%). The share of Ukraine in consolidated revenues edged down by 3 percentage points (p.p.) y-o-y, to 26%.
Sales to other markets increased by 48% y-o-y, to $2.677 million in the first quarter of 2021, accounting for 74% of total revenues. Sales to Europe surged by 54% y-o-y, primarily amid higher steel and iron ore selling prices. In addition, sales volumes of cast iron, flat products and pellets rose by 32%, 28% and 51%, respectively. As a result, the region’s share in overall revenues increased by 3 p.p. y-o-y, to 35%.
Revenues from the Middle East and North Africa (MENA) region rose by 48% y-o-y, mainly amid higher steel selling prices, as well as greater shipments of pig iron (up 29%), slabs (up 73%) and flat products (up 4%). The region’s share in consolidated revenues remained unchanged at 18%.
Sales to Southeast Asia increased by 9% y-o-y, amid higher iron ore selling prices despite practically no shipments of semi-finished and finished steel products to the region. Southeast Asia’s share in consolidated revenues declined by 2 p.p. y-o-y, to 8%.
Revenues from the CIS rose by 20% y-o-y, primarily as a result of higher selling prices for flat products. Meanwhile, the region’s share in consolidated revenues declined by 1 p.p. y-o-y, to 5%.
In the first quarter of this year, consolidated EBITDA was $1.462 billion, which is 3.9 times higher compared to the same period last year. This was primarily driven by an increase in the Mining segment’s contribution of $676 million and in the Metallurgical segment’s contribution of $494 million. In addition, corporate overheads decreased by $2 million, while eliminations increased by $83 million.
The increase in consolidated EBITDA was primarily attributable to higher average selling prices for steel and iron ore products, the effect of which on sales of Metinvest’s goods totaled $778 million. Higher prices also improved earnings from resales (up by $23 million) and the contribution of both joint ventures (up by $216 million).
In the first quarter of this year, the Group’s consolidated EBITDA margin increased by 25 p.p. y-o-y, to 40%. The Metallurgical segment’s EBITDA margin rose by 16 p.p. y-o-y, to 24%, while that of the Mining segment climbed by 38 p.p. y-o-y, to 75%.
Metinvest B.V. (the Netherlands), the parent company of the Metinvest mining and metallurgical group, in January-September 2020 reduced capital investments by 40% compared to the same period in 2019 – to $460 million.
Investment cuts were planned, according to Thursday’s preliminary unaudited interim financial results for the nine months of 2020.
“In line with the Group’s 2020 CAPEX priorities for critical asset maintenance and the completion of ongoing strategic investment projects, investments in maintenance and repairs decreased by 39%, while investments in strategic projects were reduced by 43%, which brought their share in the total volume of capital investments to 67% and 33%, respectively, in January-September 2020 (65% and 35% in the nine months of 2019),” the report says.
At the same time, it is noted that Metinvest has made progress in the following key strategic projects: modernization of the 1700 mill at the Mariupol-based Illich Iron and Steel Works (equipment tests are ongoing; a new coiler was installed and the production of the first coils was carried out in November 2020); construction of an air separation unit at the Illich plant; modernization of concentrating equipment at Central Mining and Processing Plant (MPP) (completed in March 2020); construction of a cyclic-flow technology at the Northern MPP (the second stage for transporting rocks) and Inhulets Mining (InGOK, Kryvyi Rih, Dnipropetrovsk region) (Skhidny tract); and completion of the first stage of modernization of the OK-306 roasting machine at Pivnichny MPP.
“A special priority in 2020 is given to the environmental agenda, in which the main current project is the reconstruction of the sinter plant at the Illich plant, which is expected to be completed next year. Many other initiatives have also advanced this year, including the reconstruction of the gas treatment facilities of the casting yard and the bunker rack of blast furnaces. No. 3 at the Illich plant (completed in March 2020) and converters No. 1 and No. 2 at the Azovstal Iron and Steel Works (basic and detailed engineering and technical documentation is being developed),” the document says.
The revenues of Metinvest B.V. (the Netherlands), the parent company of Metinvest mining and metallurgical group, in February 2018 decreased by 9.4%, or by $95 million, compared to the previous month, to $914 million from $1.009 billion. According to the preliminary unaudited consolidated monthly financial results of the company, EBITDA for February was $196 million, which is 14% ($32 million) less compared to January ($228 million).
According to the report, the adjusted EBITDA of the metallurgical division of the group in February 2018 was $120 million (in January some $140 million), including $12 million from participation in the joint venture ($11 million), while that of the mining division was $113 million (in January $110 million), in particular from JV some $18 million ($14 million). The management company’s expenses amounted to $7 million.
Total revenues in February 2018 consisted of the income of the metallurgical division in the amount of $778 million ($866 million in January), the mining division in the amount of $322 million ($255 million), while intra-group sales stood at “minus” $186 million (“minus” $112 million). The company’s total debt in February fell by $53 million compared to January, to $3.042 billion from $3.095 billion, while the amount of cash increased by $9 million, to $282 million from $273 million.
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