13 January 2023
Ferrexpo's logistic problems with iron ore pellets delivery to export markets in the reporting quarter coupled with electric blackouts caused by russian shelling of Ukrainian energy infrastructure.
As a result, the volume of production decreased significantly even compared to the third quarter of 2022 (in which Ferrexpo produced 905 thousand tons of pellets) and amounted to 457 thousand tons of finished products (thereof pellets with an iron content of 65% - 417 thousand tons, concentrate - 40 thousand tons).
Compared to the fourth quarter of 2021, volume of production fell by 85%.
For the whole Y2022, due to relatively good production results in the first half of the year, Ferrexpo reduced the output of commercial products by 46% (which is a good result for enterprises of the mining and metallurgical industries of Ukraine in 2022). In the current year, production amounted to 6.2 million tons (11.5 million tons in the previous year).
The dynamics of Ferrexpo production starting from the first quarter of 2020 is shown in the following graph:
Considering that the company has almost no debts, one of the main indicators for understanding the current financial position of the company is the amount of cash in its accounts (and its sufficiency to support the company's activities in the near future).
According to the company's report, as of the end of 2022, the amount of its cash on the balance sheet was approximately $105 million (compared to $172 million at the end of the first half of 2022).
Fundamentally, the company continues to look pretty good (primarily due to relatively low cost of production and no debt), so the liquidity position is key for its survival and further performance.