PJSC Magnitogorsk Iron and Steel Works

  • ISIN: US5591892048
  • Land: Russland

Nachricht vom 17.04.2018 | 08:02

PJSC Magnitogorsk Iron and Steel Works: MMK Group Trading Update for Q1 2018

PJSC Magnitogorsk Iron and Steel Works (MMK)

17-Apr-2018 / 08:02 CET/CEST
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MMK Group Trading Update for Q1 2018

ММК Group: Consolidated results

(thousand tonnes)

 

Q1 2018

Q4 2017

%

Q1 2018

Q1 2017

%

Finished product sales, of which:

2,828

2,827

0.0%

2,828

2,560

10.5%

Slabs and billets

0

2

-

0

0

-

Long products

284

342

-17.0%

284

316

-10.1%

Flat hot-rolled products

1,199

1,219

-1.6%

1,199

1,025

17.0%

Thick plate (mill 5000)

192

208

-7.7%

192

230

-16.4%

Flat cold-rolled products

338

294

15.0%

338

317

6.6%

Downstream products, of which:

815

762

6.9%

815

671

21.5%

Tin plate

36

19

89.4%

36

35

2.9%

Galvanised steel

435

389

11.8%

435

355

22.5%

Polymer-coated steel

152

157

-3.2%

152

111

36.9%

Band

37

38

-2.6%

37

27

37.0%

Formed section

35

36

-2.8%

35

21

66.7%

Pipes

11

8

37.5%

11

17

-35.3%

Metalware

95

95

0.1%

95

91

4.4%

Other metal products

14

20

-30.0%

14

13

7.7%

HVA products

1,345

1,264

6.4%

1,345

1,219

10.3%

Share of HVA products

47.6%

44.7%

 

47.6%

47.6%

 

Coal concentrate production

666

760

-12.4%

666

609

9.4%

Iron ore production

761

844

-9.8%

761

691

10.1%

Q1 2018 highlights vs. Q4 2017 and Q1 2017

       MMK Group's total steel product sales in Q1 2018 totalled 2,828 thousand tonnes. Flat quarter-on-quarter (q-o-q) but up 10.5% year-on-year (y-o-y).

       MMK Group's HVA steel product sales in Q1 2018 totalled 1,345 thousand tonnes (up 6.4% q-o-q and up 10.3% y-o-y). The share of HVA products in total sales amounted to 47.6%.

       MMK Coal's coal concentrate production in Q1 2018 totalled 666 thousand tonnes (down 12.4% q-o-q but up 9.4% y-o-y).

 

 

 


MMK Group highlights by key segments

PSJC MMK

(thousand tonnes)

 

Q1 2018

Q4 2017

%

Q1 2018

Q1 2017

%

Pig iron

2,404

2,654

-9.4%

2,404

2,372

1.3%

Crude steel

3,147

3,291

-4.4%

3,147

3,066

2.7%

Finished products output, of which:

2,830

2,787

1.6%

2,830

2,675

5.8%

Slabs and billets

0

2

-

0

0

-

Long products

427

419

2.0%

427

439

 -2.7%

Flat hot-rolled products

1,277

1,346

-5.1%

1,277

1,196

6.8%

HVA products, of which:

1,126

1,020

10.4%

1,126

1,039

8.4%

Thick plate (mill 5000)

198

210

-5.8%

198

231

-14.3%

Flat cold-rolled products

377

308

22.4%

377

353

6.8%

Downstream products, of which:

551

502

9.9%

551

455

21.1%

Tin plate

37

19

96.0%

37

37

-0.5%

Galvanised steel

330

298

10.7%

330

260

26.9%

Polymer-coated steel

91

100

-9.6%

91

89

2.4%

Band

39

36

8.6%

39

27

44.7%

Formed section

40

40

1.9%

40

24

68.6%

Pipes

14

9

60.6%

14

18

-22.8%

Shipments by market:

 

 

 

 

 

 

Russia + CIS

2,225

2,055

8.3%

2,225

1,911

16.5%

Export

605

732

-17.3%

605

764

-20.7%

(USD / tonne)

 

Q1 2018

Q4 2017

%

Q1 2018

Q1 2017

%

 Average price per tonne:

647

616

5.0%

647

573

12.9%

Long products

566

547

3.5%

566

469

20.7%

Flat hot-rolled products

582

544

7.0%

582

494

17.8%

HVA products, of which:

753

739

1.9%

753

708

6.4%

Thick plate (mill 5000)

843

807

4.5%

843

708

19.1%

Flat hot-rolled products

628

620

1.3%

628

585

7.4%

Downstream products, of which:

805

783

2.8%

805

803

0.2%

Tin plate

833

834

-0.1%

833

889

-6.3%

Galvanised steel

771

741

4.0%

771

762

1.2%

Polymer-coated steel

965

928

4.0%

965

971

-0.6%

Band

684

698

-2.0%

684

686

-0.3%

Formed section

851

800

6.4%

851

776

9.7%

Pipes

687

700

-1.9%

687

610

12.6%

       Pig iron output in Q1 2018 decreased by 9.4% q-o-q. This was due to the launch of scheduled maintenance work on blast furnace No. 1 in February 2018.

       Lower pig iron production during the blast furnace maintenance made it possible to complete scheduled repairs to the oxygen converter while avoiding losses in production. As a result, crude steel output in Q1 2018 amounted to 3,147 thousand tonnes, down only 4.4% q-o-q.

       In Q1 2018, shipments of finished products totalled 2,830 thousand tonnes, up 1.6% q-o-q. This growth in shipments (amid lower steel production) was due to reducing warehouse stocks and recovery in demand for steel on key markets of the Company.

       In Q1 2018, the Company managed to increase its domestic market shipments by 8.3% q-o-q. As a result, the share of domestic sales in the overall sales structure amounted to 78.6% (up from 73.7% in Q4 2017).

       In Q1 2018, shipments of long products increased by 2.0% q-o-q to 427 thousand tonnes. This growth was due to the increase in orders from metal traders and higher shipments to MMK-Metiz.

       The 5.1% decrease in shipments of hot-rolled products q-o-q in Q1 2018 was mainly due to changes in sales mix towards more high-margin products (with higher share of domestic sales) and scheduled maintenance of rolling mills.

       Shipments of HVA products in Q1 2018 grew 10.4% q-o-q and totalled 1,126 thousand tones. This growth was mainly due to higher sales of cold-rolled products and downstream products.

       Increase in sales of cold-rolled products in Q1 2018 (up 22.4% q-o-q) was due to higher demand from semi-integrated works and shipments of semi-finished rolled stocks to Lysvensky metallurgical plant.

       In Q1 2018, the Mill 5000's capacity utilisation rate remained at 100%. Decrease in shipments of the Mill's products by 5.8% q-o-q to 198 thousand tonnes was due to change in sales product mix supplied to pipe producers in favour of high margin but less productive steel plate.

       In Q1 2018, galvanised steel shipments increased by 10.7% q-o-q to 330 thousand tonnes mainly due to steel processing plants starting to restock amid anticipated higher prices and seasonally higher demand for steel products on the domestic market. This growth was delivered by the Company's expanded capacity to produce coated steel following the launch of a new galvanising line in mid-2017.

       Lower shipments of polymer-coated metal were due to higher shipments of galvanised steel and end of tolling transactions with Lysvensky metallurgical plant following its acquisition in late 2017.

       Sales of tin plate in Q1 2018 grew nearly two-fold q-o-q to 37 thousand tonnes due to higher demand from the food industry.

       The average sales price in US dollars in Q1 2018 increased by 5.0% q-o-q to USD 647 per tonne. This growth was due to improved sales mix, recovery of the share of domestic sales and a continued growth in rouble prices on the domestic market during the quarter.

 

 

 

 

 

 


Steel segment (Turkey)

(thousand tonnes)

 

Q1 2018

Q4 2017

%

Q1 2018

Q1 2017

%

ММК Metalurji finished products, of which:

231

213

8.1%

231

210

10.0%

Flat hot-rolled products

27

37

-27.5%

27

40

-32.5%

HVA products, of which:

204

176

15.6%

204

170

20.0%

Galvanised steel

148

122

20.9%

148

132

12.0%

Polymer-coated steel

56

54

3.7%

56

38

47.7%

ММК Metalurji finished output from ММК steel

153

176

-13.1%

153

163

-6.4%

       Sales of finished products in Q1 2018 increased by 8.1% q-o-q and totalled 231 thousand tonnes. This growth was mainly due to higher galvanised steel sales (up 26 thousand tonnes or 20.9%), which under current market conditions generated higher margin.

       Sales of finished products in Q1 2018 grew 21 thousand tonnes or 10.0% y-o-y.

       Uncertainty over the consideration of measures restricting steel imports into the EU and declared US import tariffs for a number of countries, and the commissioning of new coated metal facilities in Turkey, currently point to potential growth of competition on the domestic market.

 

MMK Coal

(thousand tonnes)

 

Q1 2018

Q4 2017

%

Q1 2018

Q1 2017

%

Coking coal mining

865

1,158

-25.3%

865

779

11.0%

Coking coal processing

1,259

1,364

-7.7%

1,259

1,047

20.2%

Mined

943

1 003

-6.0%

943

723

30.4%

Purchased

299

355

-15.8%

299

324

-7.7%

Toll

17

6

171.8%

17

0

- 

Coking coal concentrate

666

760

-12.4%

666

609

9.4%

       Coking coal production in Q1 2018 declined by 25.3% q-o-q and amounted to 865 thousand tonnes. This decline is due to maintenance work at Kostromovskaya mine and operations in a geologically complex area at Chertinskaya-Koksovaya mine.

       Coal concentrate production in Q1 2018 amounted to 666 thousand tonnes, up 12.4% q-o-q. The increase in coal production from own materials was due to lower production at Kostromovskaya and Chertinskaya-Koksovaya mines in February 2018, as well as lower coal purchases from third-parties.

       Despite lower coal production in Q1 2018, the Company plans to increase coal mining volumes and coal concentrate production in FY 2018 as compared to FY 2017.

Outlook

Management expects that growth in sales volume in Q2 2018 will be limited by high stocks in metal traders' warehouses on the domestic market and continued maintenance works on the rolling facilities.

These factors will be balanced by higher sales prices on the domestic markets and lower prices for key raw materials.

 

MMK is one of the world's largest steel producers and a leading Russian metals company. The company's operations in Russia include a large steel producing complex encompassing the entire production chain, from preparation of iron ore to downstream processing of rolled steel. MMK turns out a broad range of steel products with a predominant share of high-value-added products. In 2017, the company produced 12.9 million tonnes of crude steel and 11.6 million tonnes of commercial steel products. MMK Group had sales in 2017 of USD 7,546 million and EBITDA of USD 2,032 million.

 

 

Contacts

Investor Relations Department:

Andrey Serov

+7 3519 24-52-97

serov.ae@mmk.ru

Communications Department:

Dmitry Kuchumov Dmitry Bulin

+7 499 238-26-13 +7 499 238-26-13

kuchumov.do@mmk.ru   bulin.dn@mmk.ru

 

 




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