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Severstal reports Q4 & FY2018 operational results

Steel News - Published on Mon, 21 Jan 2019

Image Source: metalinfo.ru
Hot metal output decreased 3% QoQ in Q4 2018 to 2.23 million tonnes (Q3 2018: 2.31 million tonnes), due to BF#2 short-term maintenance works. Crude steel production declined by 4% to 2.94 million tonnes (Q3 2018: 3.06 million tonnes) reflecting a decrease in pig iron production and seasonal slowdown of production at Balakovo mini-mill.

Consolidated steel product sales increased 2% q/q to 2.76 million tonnes in Q4 2018 (Q3 2018: 2.71 million tonnes), following short-term maintenance works at rolling-mill facilities in the previous quarter. The share of domestic sales declined to 62% as a result of seasonal slowdown in domestic consumption (Q3 2018: 65%).

The share of high value-added (HVA) products within the sales portfolio decreased four ppts to 44% (Q3 2018: 48%), driven by an increase in semi-finished and hot rolled coil sales and declining sales volumes of large diameter pipes, colour coated and hot rolled thick plate.

Coking coal concentrate sales volumes from Vorkutaugol continued to grow, increasing 9% QoQ following 27% increase in Q3. This was largely driven by higher production volumes at the Zapolyarnaya and Komsomolskaya mines.

Iron ore pellet sales increased 15% to 2.94 million tonnes (Q3 2018: 2.55 million tonnes) as a result of higher production volumes and stock sell-off in Q4.

FY2018 GROUP HIGHLIGHTS
Hot metal output remained almost unchanged in 2018 at 9.15 million tonnes, however crude steel production increased 3% to 12.04 million tonnes (FY2017: 11.65 million tonnes). This was driven by an improvement in steel production efficiency following the launch of ladle furnace #2 and higher production volumes from Balakovo mini-mill. Meanwhile, the Company is continuing its efficiency programmes aimed at decreasing raw material consumption ratios in the steel production process.

Consolidated steel product sales increased 2% YoY to 11.18 million tonnes in FY2018 (FY2017: 10.92 million tonnes), reflecting crude steel production growth. The high share of HVA products remained high at 46% in FY2018 (FY2017: 46%).

Average selling prices for the majority of steel products grew substantially, by 5%-12% in FY2018, reflecting global trends as well as Severstal’s sales and marketing initiatives.

The higher iron ore concentrate sales y-o-y for FY2018 partially reflects the consolidation of the Yakovlevskiy mine and an uptick in production volumes at Olcon.

Coking coal concentrate sales volumes at Vorkutaugol increased by 2% to 3.37 million tonnes in 2018.

As announced at Severstal’s Capital Markets Day in November 2018, the Company plans to achieve coking coal concentrate production volumes growth of up to approximately 5.6mt per annum at the Vorkutaugol mines and plans to ramp-up Yakovlevskiy mine to approximately 5mt per annum in 2023, which will result in a higher level of vertical integration.

SUMMARY OF KEY PRODUCTION, SALES VOLUMES
Production, thousands of tonnesQ4 2018Q3 2018Change, %20182017Change, %
Crude Steel (Russian Steel)29413064(4%)12039116513.00%
Hot metal (Russian Steel)22332307(3%)91469158(0%)

Sales volumes, thousands of tonnesQ4 2018Q3 2018Change, %20182017Change, %
Coking coal concentrate10439539.00%337432942.00%
Iron ore pellets2943255415.00%1099711133(1%)
Iron ore concentrate143014240.00%5510425130.00%
Total steel products (Consolidated)275627122.00%11176109192.00%
Total steel products (Russian Steel)276727222.00%11220109592.00%
 


SEVERSTAL’S CONSOLIDATED SALES (NET OF INTERCOMPANY SALES)

Sales volumes, thousands of tonnesQ4 2018Q3 2018Change, %20182017Change, %
Coal:54438143.00%16711700(2%)
Coking coal concentrate16910955.00%359127183.00%
Steam coal37527238.00%13121573(17%)
Iron ore:2128167127.00%7405664511.00%
Iron ore pellets1871146528.00%657865141.00%
Iron ore concentrate25720625.00%827131531.00%
Semi-finished products1579762.00%69551934.00%
Rolled products:218621482.00%871985402.00%
Hot-rolled coil10179468.00%38953949(1%)
Hot-rolled plate210218(4%)8528046.00%
Cold-rolled coil2962806.00%12861324(3%)
Galvanised and metallic coated coil208211(1%)83565428.00%
Colour coated coil97122(20%)391403(3%)
Long products358371(4%)146014064.00%
Downstream products:413467(12%)17621861(5%)
Metalware products136150(9%)560615(9%)
Large diameter pipes107128(16%)4404166.00%
Other tubes, pipes, formed shapes170189(10%)762830(8%)
 

Source :

Posted By : Joykumar Irom on Mon, 21 Jan 2019
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