Business news from Ukraine

UKRAINE BOOSTS PIPE EXPORT, MAJOR MARKETS – UNITED STATES, ITALY, TURKEY

Ukraine in January-August 2018 increased steel pipe exports by 7.3% compared to the same period in 2017, to 434,600 tonnes, of which 70.2% accounted for seamless, 29.8% for welded pipes, according to a Monday press release of the state-owned Enterprise Derzhzovnishinform. At the same time, foreign exchange earnings from pipe exports increased by 39.6% to $484.6 million (82.2% – seamless and 17.8% – welded pipes).
According to the results of the eight months ending August 2018, the export of semi-finished products was 4.512 million tonnes, which is 16.5% more compared to the same period last year. In monetary terms, the growth in exports of semi-finished products amounted to 47.3%, to $2.167 billion.
The volume of export of finished rolled products decreased by 2.8% to 5.498 million tonnes, however, due to the general increase in prices in the global market in the segment of finished rolled products, revenues from its exports increased by 18.6%, to $3.248 billion.
The volume of exports of raw materials for metallurgy (goods from group 72) increased by 31%, to 3.04 million tonnes in January-August 2018, while foreign exchange earnings increased by 25.2%, to $ 1.534 billion.
A significant upward dynamics is demonstrated by the export of pig iron, which increased by 45.8%, to 2.113 million tonnes. The main sales markets for Ukrainian iron are the United States, Italy and Turkey.
Exports of ferroalloys in January-August increased by 2.5% to 622,700 tonnes, scrap metal exports increased by 17% to 300,300 tonnes. Proceeds from the export of ferroalloys for the period fell 2.9%, to $696.9 million, but increased from scrap exports by 69.8%, to $98.2 million.
Import of rolled metal to Ukraine in the first eight months of this year in kind increased 11.7%, to 883,500 tonnes, and in monetary terms – by 22.2%, to $711.7 million.
Imports of flat steel increased 0.6% to 192,500 0 tonnes, but imports of flat rolled products with coating decreased by 7.8%, to 311,100 tonnes. At the same time, the foreign exchange costs for the import of rolled products amounted to $711.7 million.

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INTERPIPE PIPE AND WHEEL COMPANY PRESENTS PLAN FOR RESTRUCTURING $1.25 BLN LIABILITIES

Interpipe pipe and wheel company (Dnipro) at a meeting with the creditors in London on July 17 presented a preliminary plan for restructuring its liabilities worth $1.25 billion, Concorde Capital investment company has reported, with reference to a report by Reorg Research. The debtor, in particular, proposes to convert this debt into six-year eurobonds for $310 million with a coupon of 9.35% per annum, as well as two credit tranches of $45 million to Ukrainian banks and $45 million to international ones. The rest of the debt will be written off.
Eurobond holders and international banks will also receive securities, payments on which will be tied to Interpipe’s EBITDA. Ukrainian banks will not receive the relevant securities, at the same time they will have less debt forgiveness.
The terms of restructuring also imply imposing a $40 million fine on Interpipe if it allows non-payment under new eurobonds or loans to international banks.
Interpipe intends to pay creditors a substantial commission fee if the restructuring plan for liabilities is approved.
The adviser to the debtor is Stephenson Harwood (the UK), to the creditors Alvarez & Marsal and Allen & Overy (the UK).

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UKRAINE BOOSTS PIPE OUTPUT BY 10%

The major pipe enterprises of Ukraine in January-May 2018 boosted production of pipes by 10% compared to the same period last year, to 448,000 tonnes, including in May they manufactured 91,000 tonnes. The Ukrtruboprom association told Interfax-Ukraine that enterprises, which are members of the association, boosted production by 23.5% year-over-year, to 336,000 tonnes, including 72,000 tonnes made in May.
Khartsyzsk Pipe Plant (Donetsk region), located in the government uncontrolled zone, remained idle in January-May 2018, while it made 3,400 tonnes of pipes in January-May 2017.
Pipe production at Interpipe Nyzhniodniprovsky Pipe Rolling Plant in the period rose by 28.4% compared to January-May 2017, to 124,000 tonnes (26,400 tonnes in May 2018 alone), Interpipe Novomoskovsk Pipe Plant increased output by 16.7%, to 44,100 tonnes (10,400 tonnes in May), while Interpipe Niko Tube raised production by 30%, to 147,400 tonnes (30,900 tonnes in May).
Dnipropetrovsk Pipe decreased pipe production by 7.9%, to 9,300 tonnes, making 2,100 tonnes in May. Production at Centravis grew by 10.5%, being 8,400 tonnes of stainless pipes (1,800 tonnes in May).
Pipe production at Trubostal rose by 8.3% in the first five months, to 1,300 tonnes of pipes (200 tonnes in May 2018).
Mariupol Illich Steel Works, which is not a member of the association, reduced pipe production by 14.8%, to 50,500 tonnes (6,800 tonnes in May), while Kominmet saw an 18.8% decrease, to 61,700 tonnes (12,100 tonnes).
Luhansk Pipe Rolling Plant, created on the basis of Luhansk Pipe Plant, remained idle according to unofficial information.
As was reported, major pipe producers of Ukraine in 2017 boosted pipe production from ferrous metals by 23.5% from 2016, to 1,047,800 tonnes. Ukrtruboprom’s enterprises alone saw a 27.8% rise in output, to 705,500 tonnes.