18 August 2017
Disregarding results of enterprises situated at non-controlled by Ukrainian government Donbass territory in Q2 2017 Metinvest improved its operating performance.
Quarterly production figures
k tons
Q4 2015
Q1 2016
Q2 2016
Q3 2016
Q4 2016
Q1 2017
Q2 2017
Crude steel
1 712
1 998
2 191
2 149
2 058
2 070
1 853
Iron ore concentrate
8 213
7 911
7 902
7 137
6 692
6 680
6 969
Coke
1 113
1 124
1 066
1 126
1 009
977
1 154
Coking coal
803
799
781
740
732
792
654
In reporting quarter total Metinvest crude steel output decreased vs. previous quarter by 10%, while y-o-y decline made 6%. Main reason – lost control over EMZ (situated in Enakievo) in March 2017 – disregarding this mill, Metinvest increased crude steel production: by 3% vs. Q1 2017 and by 6.4% y-o-y.
Disregarding EMZ Metinvest steel output during last reporting quarters looked as follows:
In total in H1 2017 Metinvest produced 4M tons of pig iron (-6% y-o-y, however disregarding EMZ +11%) and 3.9M tons of steel (-6%, disregarding EMZ +13%).
We note that in H1 2017 Azovstal increased its production volumes by more than 20%, while results of MMKI have been much more modest (growth of iron pig production by 2% and steel output by 4%). Reasons of worse results of MMKI – maintenance works at one of blast furnaces (which took 7 days) and periodic disruptions in coke supplies from Avdeevka KHZ in February-March (please see explanation below, as a result in Q2 pig iron production by the mill increased vs. Q1 by 38%).
In H1 2017 coke production by the group declined y-o-y by 3%, main reason – unstable operations of AKHZ (Avdeevka coke producing plant) in February-March due to war conflict escalation near Avdeevka. At the moment normal work of Avdeevka Coke Plant is one of main risks for Metinvest activity in short period of time.
In H1 2017 the group’s output of iron ore concentrate dropped by 14% y-o-y (to 13.649M tons) to needs to catch up with overburden removal works.
As for coal concentrate, as a result of lost control over Krasnodonugol (which situated at the non-controlled by Ukrainian government part of Donbass), its total output by Metinvest declined by 8% to 1.447M tons (we note that output of US-based United Coal stays relatively stable).
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