(Alliance News) - Evraz PLC on Thursday posted a higher annual profit as it swung to a net gain on foreign exchange, though lower prices hurt revenue.
For 2020, the Russian steel maker reported a USD1.30 billion pretax profit, up 44% from USD902 million the year before. This was despite an 18% revenue decline to USD9.75 billion from USD11.91 billion on lower sales prices for steel, vanadium and coal products amid gloomier market trends.
Evraz's higher profit resulted from various factors, including a swing to a USD408 million net gain on foreign exchange from a USD341 million loss.
Other contributors to Evraz's profit increase for 2020 included a reduction in selling & distribution costs to USD840 million from USD966 million, as well as in general & administrative expenses to USD551 million from USD611 million.
Additionally, Evraz reported a USD310 million impairment of non-financial assets, down from USD442 million the prior year.
The company reported earnings before interest, tax, depreciation and amortization of USD2.22 billion, down 15% year-on-year, but this still outperformed the company-compiled analyst consensus, which seen Ebitda coming in at USD1.91 billion.
Evraz has declared a USD0.30 per share interim dividend, which it says reflects "confidence in the group's financial position and outlook". This was down from USD0.40 per share the year before.
Chief Executive Alexander Frolov said: "In 2021, Evraz will continue to improve its safety culture, customer focus and operational efficiency, using digital tools where appropriate. The group aims to achieve significant progress in its key investment projects, the foremost of which is to upgrade the rail mills in North America and Nizhny Tagil. Evraz will also focus on making the best possible use of the opportunities that arise as the markets begin to recover from the pandemic in 2021."
Shares in Evraz were up 1.5% at 573.20 pence in London on Thursday morning.
By Anna Farley; annafarley@alliancenews.com
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Evraz (EVR)