Ferrexpo releases its production report for Q4 2015

Despite challenging market environment related to iron ore prices slump, the company demonstrated growth of pellets production in both Q4 and the whole Y2015. In Q4 volume of production made 2.984M tons, which was by 4.3% higher vs. corresponding period of previous year.

Almost 95% of total production volume made 65% Fe premium pellets, record-high for Ferrexpo. In the beginning of Y2015 the company finished large-scale investment program, which (in addition to total increase of potential production volumes) allowed it to significantly increase 65% Fe pellets share in total production (vs. 52.7% in Y2014, 46.3% in Y2013).

As for the whole Y2015 total pellets production made 11.661M, by 5.8% higher vs. previous year, with the share of 65% Fe pellets at 89% of total.

During last quarter iron ore price index further declined to (estimated) USD 46 per 1 ton (-15% to previous quarter and -38% to corresponding period of previous year). On positive side for operations profitability have been further decline in oil price and certain UAH devaluation (by about 10%), so that C1 and C3 costs are expected in last quarter to be lower than in previous reporting periods, which should support profitability of Ferrexpo. We expect C1 cash cost of the company in Q4 2015 to be not higher than USD 28 per 1 ton (USD 33.4 in 1H 2015), EBITDA margin not less than 23-25%.

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Astarta
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