11 Dec 2008 07:00
December 11, 2008
MMK IFRS Results for the 9 Months ended September 30, 2008
Magnitogorsk Iron and Steel Works ('MMK'), a leading integrated Russian steel producer, announces its consolidated financial results according to IFRS for the nine months ending September 30, 2008.
Financial Highlights (in US$ million)
|
| Q3 2008 | Q2 2008 | % | 9m 2008 | 9m 2007 | % |
| Sales | 3 529 | 2 150 | 1% | 9 182 | 6 150 | 49% |
| EBITDA | 1 079* | 1 071* | 1%* | 2 673 | 1 899 | 41% |
| EBITDA margin | 30,6%* | 30,7%* | - | 29,1% | 30,9% | - |
| Net Income | 667 | 633 | 5% | 1 483 | 1 041 | 42% |
* based on the Company's calculations
Key 9 months 2008 Financial Highlights
Operational Background
Given the recent weakening of the steel market, MMK adjusted its production levels for Q4 2008 in order to support prices and meet decreased demand. The management views recent production cuts at MMK as a sensible and prudent response to the current conditions.
Financial Position
MMK's financial position remains sound and its cash flow generation is strong. Total debt equals to US$ 1.478bn. Short-term debt, including current portion of long-term debt amounted to US$ 1.220bn. Short-term debt includes revolving credit facilities in the amount of US$ 434m arranged to finance trading companies - members of MMK Group.
The company's cash position equals to US$ 985m as of 30 September 2008 that is US$ 179m or 22% higher comparing to the H1 08 figure. Total cash position and equivalents amounts to US$ 1.106bn as of 30 September 2008. Net debt equals to US$ 372m.
Commenting on the results, Victor Rashnikov, the Chairman of MMK Board of Directors said:
"The last two months have witnessed some of the most difficult trading conditions in the steel sector in many years.
However, I would like to emphasize that MMK remains financially strong. Our modernized asset base, diversified steel making technologies, strong balance sheet, broad product mix and high level of internally generated electricity provide us with sufficient flexibility in current conditions.
Record steel prices and generally favourable market environment of the first nine months of 2008 provided support for our margins in this period and it leads us to expect good full year results. I am confident that the business is well positioned to emerge as the market leader once the market recovers."
Consolidated financial statements for 9 months 2008 results under IFRS can be found here:
http://www.rns-pdf.londonstockexchange.com/rns/9390J_-2008-12-11.pdf
or at our web page http://www.mmk.ru/eng/invrelations/b_reports/index.wbp
Information on MMK:
The Magnitogorsk Iron and Steel Works OJSC (MMK) is among the world's largest steel producers and is one of the leaders of Russia's steel industry. The Company is a large steel producing complex encompassing the entire production chain, from preparation of iron ore to downstream processing of rolled steel. MMK turns out a broad range of steel products with a predominant share of value added goods. In 2007 the Company produced 13.3 m tonnes of crude steel, and 12.2 m tonnes of commercial products. US GAAP sales stood at USD 8.2 bn, with net income at USD 1.8 bn.
Contacts
MMK:
Elena Azovsteva +7 3519 24 90 82 e-mail: azovtseva@mmk.ru
Evgeny Kovtunov +7 3519 24 93 55 e-mail: kovtunov@mmk.ru
Finsbury:
Brian Cattell, Peter Russell, Sophia Matveeva +44 207 251 3801