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(Alliance News) - Evraz PLC on Thursday said it saw a decrease in sales and output during the first quarter as a result of machine downtime and a fall in demand.
The steel, mining and vanadium business with operations in Russia reported crude steel output in the first quarter fell by 1.7% quarter-on-quarter, mainly due to unscheduled downtime of the sintering machine at Evraz ZSMK, it said.
Evraz's sales of steel products in the first quarter dropped by 9.9% from the previous quarter. This was driven primarily by "lower sales of semi-finished products amid reduced steel availability due to lower pig-iron production volumes", it said. A seasonal decline in sales of construction products and local decrease in demand for rails in Russia also had an impact.
The company's coking coal concentrate production in the first quarter grew by 3.6% quarter-on-quarter due to increased coal mining volumes, while external sales of iron ore products fell by 30%.
"One of the primary drivers was a decline in concentrate production at Evraz KGOK which went down due to lower iron content in mined ore and severe weather conditions, resulted in unscheduled equipment repairs. In addition, shipments of iron ore products to Evraz NTMK were increased to restore reserves," said Evraz.
Looking ahead to the second quarter, Evraz said pig iron production volumes are expected to slightly increase following the completion of equipment downtime in the first quarter at Evraz ZSMK.
"Iron ore pellets and sinter production volumes are expected to remain flat," it added.
Earlier this month, Evraz's board gave the green light to move forward in its preparations for the potential demerger of its coal assets. All the company's coal assets sit under its subsidiary, PJSC Raspadskaya PAO, which is listed on the Moscow Exchange.
Shares in Evraz were down 1.1% at 655.40 pence in London on Thursday morning.
By Zoe Wickens; zoewickens@alliancenews.com
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