Severstal reports Q3 2019 operational results
PAO Severstal (SVST)
Severstal reports Q3 2019 operational results
11-Oct-2019 / 09:00 MSK
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Severstal reports Q3 2019 operational results
Moscow, Russia - 11 October 2019 - PAO Severstal (MICEX-RTS: CHMF; LSE: SVST), one of the world's leading vertically integrated steel and steel-related mining companies, today announces its operational results for Q3 2019.
Q3 2019 GROUP HIGHLIGHTS
Hot metal output increased 7% q/q in Q3 2019 to 2.46 mln tonnes (Q2 2019: 2.30 mln tonnes) following short-term maintenance works at BF#1, BF#4 and BF#5 in the previous quarter. Crude steel production declined 1% to 3.03 mln tonnes (Q2 2019: 3.06 mln tonnes) mainly reflecting a decline in EAF steel output following the sale of Balakovo mini-mill in July 2019.Consolidated steel product sales remained flat q/q at 2.83 mln tonnes in Q3 2019 (Q2 2019: 2.83 mln tonnes). The share of domestic sales remained at historically high levels of 67% due to their continued attractiveness (Q2 2019: 70%).
The share of high value-added (HVA) products within the sales portfolio amounted to 45% (Q2 2019: 46%), reflecting a decline in sales of galvanised, colour-coated and cold-rolled products due to short-term maintenance works at one of the pickling lines. This was offset by higher sales volumes of thick plate and lower sales of long products.
Coking coal concentrate sales volumes from Vorkutaugol surged 41% q/q in line with the 42% increase q/q in production of run-of-mine coal.
Iron ore pellet sales declined 15% to 2.46 mln tonnes (Q2 2019: 2.90 mln tonnes) reflecting higher production of iron ore concentrate at Karelsky Okatysh.
Iron ore concentrate sales volumes increased 35% to 1.93 mln tonnes (Q2 2019: 1.43 mln tonnes) driven by production volumes growth at Karelsky Okatysh.
9M 2019 GROUP HIGHLIGHTS
Hot metal output increased 3% y/y to 7.13 mln tonnes in 9M 2019 (9M 2018: 6.91 mln tonnes) driven by improved maintenance works efficiency and higher quality of raw materials. Crude steel production remained almost flat at 9.13 mln tonnes (9M 2018: 9.10 mln tonnes), predominantly reflecting higher aggregate productivity levels, which were offset by lower EAF production in Q3 following the sale of Balakovo mini-mill.Coking coal concentrate sales volumes from Vorkutaugol increased 43% y/y, driven by growth in coal production. Iron ore concentrate sales volumes increased 14% y/y to 4.66 mln tonnes (9M 2018: 4.08 mln tonnes) predominantly reflecting production volumes growth at Karelsky Okatysh.
The share of HVA products remained high at 45% in 9M 2019, primarily reflecting higher sales of galvanised and colour-coated products following the launch of new product lines, which reached their full utilisation rates in Q1 2019.
SUMMARY OF KEY PRODUCTION, SALES VOLUMES
Production, thousands of tonnes
Q3 2019
Q2 2019
Change, %
9M 2019
9M 2018
Change, %
Crude Steel (Russian Steel)
3,032
3,057
(1%)
9,133
9,098
0%
Hot metal (Russian Steel)
2,458
2,304
7%
7,125
6,913
3%
Sales volumes, thousands of tonnes
Q3 2019
Q2 2019
Change, %
9M 2019
9M 2018
Change, %
Coking coal concentrate
1,351
958
41%
3,340
2,331
43%
Iron ore pellets
2,461
2,899
(15%)
8,192
8,054
2%
Iron ore concentrate
1,931
1,428
35%
4,660
4,080
14%
Total steel products (Consolidated)
2,834
2,837
0%
8,503
8,420
1%
Total steel products (Russian Steel)
2,847
2,848
0%
8,538
8,453
1%
High value added steel products, %
Q3 2019
Q2 2019
Change, %
9M 2019
9M 2018
Change, %
Severstal (Consolidated)
45%
46%
(1 ppts)
45%
46%
(1 ppts)
Severstal Russian Steel
45%
46%
(1 ppts)
45%
46%
(1 ppts)
SEVERSTAL'S CONSOLIDATED SALES (NET OF INTERCOMPANY SALES)
Sales volumes, thousands of tonnes
Q3 2019
Q2 2019
Change, %
9M 2019
9M 2018
Change, %
Coal:
330
388
(15%)
1,250
1,127
11%
Coking coal concentrate
66
108
(39%)
331
190
74%
Steam coal
264
280
(6%)
919
937
(2%)
Iron ore:
1,443
1,686
(14%)
4,785
5,277
(9%)
Iron ore pellets
1,380
1,488
(7%)
4,170
4,707
(11%)
Iron ore concentrate
63
198
(68%)
615
570
8%
Semi-finished products
89
69
29%
279
538
(48%)
Rolled products:
2,292
2,313
(1%)
6,916
6,533
6%
Hot - rolled coil
1,168
1,040
12%
3,310
2,878
15%
Hot - rolled plate
244
225
8%
702
642
9%
Cold - rolled coil
226
242
(7%)
743
990
(25%)
Galvanised and metallic coated coil
238
254
(6%)
729
627
16%
Colour coated coil
122
141
(13%)
365
294
24%
Long products
294
411
(28%)
1,067
1,102
(3%)
Downstream products:
453
455
0%
1,308
1,349
(3%)
Metalware products
147
140
5%
413
424
(3%)
Large diameter pipes
100
106
(6%)
303
333
(9%)
Other tubes, pipes, formed shapes
206
209
(1%)
592
592
0%
SEVERSTAL RESOURCES
Coking coal concentrate sales volumes from Vorkutaugol surged 41% q/q reflecting the 42% increase q/q in production of run-of-mine coal.
Iron ore pellet sales declined 15% to 2.46 mln tonnes (Q2 2019: 2.90 mln tonnes) reflecting higher production of iron ore concentrate at Karelsky Okatysh.
Iron ore concentrate sales volumes increased 35% to 1.93 mln tonnes (Q2 2019: 1.43 mln tonnes) driven by production volumes growth at Karelsky Okatysh.
Sales volumes, thousands tonnes
Q3 2019
Q2 2019
Change, %
9M 2019
9M 2018
Change, %
Coal:
1,616
1,238
31%
4,260
3,269
30%
Coking coal concentrate
1,351
958
41%
3,340
2,331
43%
Steam coal
265
280
(5%)
920
938
(2%)
Iron ore:
4,392
4,327
2%
12,852
12,134
6%
Iron ore pellets
2,461
2,899
(15%)
8,192
8,054
2%
Iron ore concentrate
1,931
1,428
35%
4,660
4,080
14%
SEVERSTAL RUSSIAN STEEL ('RSD')
RSD steel product sales remained flat q/q at 2.85 mln tonnes in Q3 2019 (Q2 2019: 2.85 mln tonnes).The share of domestic sales declined 3 ppts, to 67%, but remained at historically high levels due to a favourable domestic pricing environment (Q2 2019: 70%).
The share of high value-added (HVA) products within the sales portfolio amounted to 45% (Q2 2019: 46%), reflecting a decline in sales of galvanised, colour-coated and cold-rolled products due to short-term maintenance works at one of the pickling lines. This was offset by higher sales volumes of thick plate and lower sales of long products.
LDP sales volumes declined 6% q/q, reflecting changes in the product mix. Izhora Pipe Mill maintained its 100% utilisation rate in Q3 2019.
The weighted average selling price for the whole range of rolled steel products remained almost flat in Q3 2019, reflecting the flexibility of Severstal's distribution channels as well as a favourable pricing environment in the domestic market.
Sales volumes, thousands of tonnes
Q3 2019
Q2 2019
Change, %
9M 2019
9M 2018
Change, %
Total steel products
2,847
2,848
0%
8,538
8,453
1%
Semi-finished products
89
69
29%
279
538
(48%)
Rolled products:
2,305
2,322
(1%)
6,949
6,565
6%
Hot - rolled coil
1,169
1,040
12%
3,311
2,879
15%
Hot - rolled plate
245
225
9%
703
642
10%
Cold - rolled coil
226
242
(7%)
743
990
(25%)
Galvanised and metallic coated coil
238
254
(6%)
729
627
16%
Colour coated coil
122
141
(13%)
365
294
24%
Long products
305
420
(27%)
1,098
1,133
(3%)
Downstream products:
453
457
(1%)
1,310
1,350
(3%)
Metalware products
148
142
4%
416
425
(2%)
Large diameter pipes
100
106
(6%)
303
333
(9%)
Other tubes, pipes, formed shapes
205
209
(2%)
591
592
0%
Sales price, $/tonne
Q3 2019
Q2 2019
Change, %
9M 2019
9M 2018
Change, %
Semi-finished products
414
450
(8%)
427
468
(9%)
Hot - rolled coil
510
514
(1%)
506
562
(10%)
Hot-rolled plate
683
659
4%
660
716
(8%)
Cold - rolled coil
647
629
3%
621
627
(1%)
Galvanised and metallic coated coil
733
729
1%
724
761
(5%)
Colour coated coil
905
918
(1%)
894
943
(5%)
Long products
498
484
3%
476
494
(4%)
Metalware products
965
981
(2%)
965
970
(1%)
Large diameter pipes
945
1,033
(9%)
996
1,116
(11%)
Other tubes, pipes, formed shapes
580
585
(1%)
578
611
(5%)
Notes:
1) All production data is reported in thousands of tonnes;
2) Sales prices are stated on EXW basis;
3) Segmental data includes intercompany sales;
4) Semi-finished products include pig iron, slabs, billets, ingots, steel casting and forgings;
5) Large diameter pipes include all pipes with a diameter between 820 and 1420 mm.
Contacts
Investor Relations
Evgeny Belov
T: +7 (495) 926-77-66 ext. 6445
evgenii.belov@severstal.com
Public Relations
Anastasia Mishanina
T: +7 (495) 926-77-66 ext. 6457
anastasia.mishanina@severstal.com
Severstal's financial communications agency - Hudson Sandler
Andrew Leach / Emily Dillon
T: +44 (0) 20 7796 4133
***
PАО Severstal is one of the world's leading vertically-integrated steel and steel related mining companies, with assets in Russia, Latvia and Poland. Severstal is listed on RTS and MICEX and the company's GDRs are traded on the LSE. Severstal reported revenue of $8,580 million and EBITDA of $3,142 million in 2018. Severstal's crude steel production in 2018 reached 12.0 million tonnes. www.severstal.com
ISIN: US8181503025 Category Code: TST TIDM: SVST LEI Code: 213800OKDPTV6K4ONO53 Sequence No.: 23109 EQS News ID: 888559
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