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MMK Group Q3 performance highlights by key segments

Steel News - Published on Mon, 22 Oct 2018

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Pig iron output in Q3 2018 increased by 15.2% q-o-q. This was due to the completion of scheduled maintenance work at blast furnace No. 1 at the end of the previous quarter and the furnace’s operations reaching full capacity. Higher pig iron output coupled with the completion of scheduled repairs to the oxygen converter led to an 11.5% q-o-q increase in crude steel output for the quarter.

Sales of finished products in Q3 2018 grew 8.9% q-o-q to 3,007 thousand tonnes. Adequate amounts of steel and consistently high level of demand in the Company’s sales markets allowed MMK not only to reach full capacity utilisation but also to keep warehouse stocks of finished products at a minimum.

In Q3 2018, the Company continued to increase sales to the domestic market (up 2.7% q-o-q). The pricing environment on external markets also allowed the Company to increase export sales by 183 thousand tonnes, or 38.0% q-o-q. As a result, domestic sales accounted for 77.8% of overall sales (82.5% in Q2 2018).

In Q3 2018, sales of long products increased by 3.5% q-o-q to 481 thousand tonnes. This growth was due to the seasonal uptick in domestic demand for construction products, leading to increased capacity utilisation of long products production facilities.
The significant increase in shipments of hot-rolled products in Q3 2018 (up 201 thousand tonnes, or 16.5% q-o-q) was due to completion of a stage of reconstruction of Mill 2500 and equipment upgrades.

Shipments of HVA products in Q3 2018 increased 2.5% q-o-q and totalled 1,104 thousand tonnes. In 9M 2018, shipments of HVA products grew 177 thousand tonnes, or 5.7%, y-o-y. This growth was mainly due to the new hot-dip galvanizing line reaching full capacity, higher sales of cold-rolled products to the Lysva Metallurgical Plant, and higher sales of other HVA products on the domestic market.

The increase in shipments of cold-rolled products in Q3 2018 by 2.0% q-o-q was due to higher exports of black tin steel on the backdrop of high capacities utilisation rates.

In Q3 2018, shipments of Mill 5000 products grew 6.1% q-o-q with capacity utilisation of 100%. The increase was due to changes in the order mix, particularly lower orders for high-tech but less productive rolled steel from large-diameter pipe producers, which was offset by higher sales to other industries and higher export sales.

In Q3 2018, galvanised steel and polymer-coated steel shipments remained flat q-o-q and amounted to 312 thousand tonnes and 87 thousand tonnes, respectively.

The increase in shipments of galvanised steel in 9M 2018 by 118 thousand tonnes, or 14.1%, was due to the new hot-dip galvanizing line reaching full capacity which amid stable demand from the construction industry allowed the Company to substitute imports. Sales to carmakers also were higher q-o-q.

Lower shipments of polymer-coated metal were due to both higher shipments of galvanised steel and changes in the reporting of product sales by Lysva Metallurgical Plant following its acquisition in late 2017.

Sales of formed section in 9M 2018 grew 50.1% y-o-y due to consistently high demand from railcar manufacturers.

The average sales price in US dollars in Q3 2018 decreased by 6.7% q-o-q to USD 610 per tonne. This decrease was due to the correction in global steel prices and devaluation of the rouble vs the dollar during the quarter.

Q3 2018Q2 2018%9M 20189M 2017%
Pig iron2621227615.20%73017509-2.80%
Crude steel3376302911.50%95529569-0.20%
Finished products sales, of which:300727628.90%859985460.60%
Long products4814643.50%137213680.30%
Flat hot-rolled products1422122116.50%39204048-3.20%
HVA products, of which:110410762.50%330631295.70%
Thick plate (mill 5000)2152026.10%6166101.00%
Flat cold-rolled products3553482.00%107910146.40%
Downstream products, of which:5345261.50%161115057.00%
Tin plate2736-24.30%99981.10%
Galvanised steel312313-0.20%95483614.10%
Polymer-coated steel8788-0.40%266340-21.80%
Formed section473919.50%1268450.10%
Shipments by market:
Russia + CIS233922782.70%684264745.70%

(In thousand tonnes)

Q3 2018Q2 2018%9M 20189M 2017%
Average price per tonne:610655-6.70%63756113.50%
Long products528566-6.70%55347416.70%
Flat hot-rolled products550588-6.50%57348019.40%
HVA products, of which:723769-5.90%7477056.00%
Thick plate (mill 5000)691818-15.40%7797503.90%
Flat cold-rolled products613641-4.40%62656610.60%
Downstream products, of which:810834-2.90%8157814.40%
Tin plate790826-4.40%812859-5.50%
Galvanised steel797814-2.10%7937387.50%
Polymer-coated steel10021008-0.60%9919296.70%
Formed section777828-6.20%8177666.70%

In USD per tonne

Source :

Posted By : Ratan Singh on Mon, 22 Oct 2018
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