MMK.L Regulatory News (MMK)

17 Oct 2007 10:32

OJSC Magnitogorsk Iron &Steel Works17 October 2007 MAGNITOGORSK IRON AND STEEL WORKS Open Joint Stock Company OAO MMK PRESS-RELEASE City of Magnitogorsk October 17, 2007 OJSC MMK has announced its production results for the 3rd Quarter and 9 monthsof 2007. 1. Production of Main Products Description 3rd Q 2007 2nd Q 2007 Change 9 months 2007 9 months 2006 Changes '000 tons '000 tons % '000 tons '000 tons %Pig iron 2,546 2,354 8,2% 7,198 7,427 -3.1%Steel 3,458 3,331 3.8% 9,934 9,187 8.1%Commercialproducts* 3,146 3,021 4.1% 9,097 8,352 8.9% Main Commercial Products, '000 tons: Description 3rd Q 2007 2nd Q 2007 Change 9 months 2007 9 months 2006 ChangeSlabs 321 132 190 588 121 467Long products 449 478 -29 1,384 1,248 136Flat products(HR) 1,584 1,610 -26 4,843 4,495 349Flat products(CR) 396 428 -31 1,154 1,293 -139Tinplate 72 70 2 197 228 -31Galvanized steel 110 102 7 318 337 -20Galvanized colour coated steel 46 46 1 137 122 15Narrow strip 85 86 -1 253 256 -3Cold-formed sections 63 50 13 166 143 23 * Counting production for the Group companies Notes: Due to the repairs and upgrading of the blast furnaces, including BF # 6(installation of a bell-less charging device) the production level for the 9months of 2007 was lower than in the same period of 2006.Thanks to the ramp-up of EAF steel making 2007 is seeing a steady increase ofthe crude steel and steel products output. The faster growth of steel makingcompared to MMK's rolling capacity has led to a surplus of commercial slabs.Currently MMK is implementing a greenfield project of building a 1.5 mtpy, 5,000mm plate mill and continuing modernization of the existing 2,000 and 2,500 mmhot rolling mills aimed at improving quality, broadening the product mix andbuilding up rolling capacity. When completed, these projects will allow to fullyprocess all the slabs produced at MMK.Output of long products in the 9 months of 2007 has been stepped up against thesame period of last year thanks to achieving the design capacity at all the longproducts mills.The lower output of flat and long products in the 3rd Q of 2007 compared to the2nd Q is attributable to the scheduled maintenance of the production equipment. 2. Prices Prices have been calculated by dividing sales proceeds by sales quantities. Thismethod does not take into account the differentiation of products by qualitygrades and sales markets, therefore the price levels should be viewed asindicative. Average OJSC MMK Prices: Description 3rd Q 2007 2nd Q 2007 Change 9 months 2007 9 months 2006 Change $/tonne $/tonne % $/tonne $/tonne %Slabs 431 433 -0.6% 410 376 9%Long 620 614 1% 582 406 43.3%productsFlatproducts(HR) 561 577 -2.8% 543 440 23.4%Flatproducts(CR) 603 614 -1.8% 594 491 21%Tinplate 857 859 -0.2% 844 863 -2.2%Galvanized steel 937 961 -2.5% 936 825 13.5%Galvanized colour coated steel 1,280 1,254 2% 1,233 980 25.8%Narrow strip 660 697 -5.3% 657 574 14.5%Cold-formedsections 791 764 3.4% 755 610 23.8% Additional Information: The Magnitogorsk Iron & Steel Works OJSC (MMK) ranks 20th among the world'slargest steel producers (Source: IISI) and is one of the leaders of Russia'ssteel industry (Source: Chermet). The company is a large steel producing complexencompassing the entire production chain, from preparation of iron ore todownstream processing of rolled steel. MMK turns out a broad range of steelproducts with a predominant share of value added goods. In 2006 the Companyproduced 12.5 m tonnes of crude steel and 11.3 m tonnes of commercial products.In 2006 sales under US GAAP amounted to USD 6.4 bn, with net profit standing atUSD 1.4 bn. Contact persons for additional information: Press secretary: Elena Azovtseva Phone: +7 3519 24 90 82 E-mail: azovtseva@mmk.ru Head of Investor Relations : Evgeny Kovtunov Phone: +7 3519 24 93 55 E-mail: kovtunov@mmk.ru This information is provided by RNS The company news service from the London Stock Exchange