13 Aug 2010 07:00
August 13, 2010
OJSC "Magnitogorsk Iron and Steel Works" (MMK) announces
financial results under Russian Accounting Standards (RAS) for Q2 2010
The results reflect MMK (parent company) operations only and may vary significantly from the consolidated financial results under IAS.
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·; MMK RAS sales rose by 26% in Q2 2010 q-o-q and amounted to RUR 53.117 bn.
·; MMK net profit under RAS net revaluation of investment in securities increased by 24% in Q2 2010 to RUR 4.678 bn.
·; Share of HVA products grew in Q2 2010 from 30% to 35% q-o-q.
Key Q2 2010 operational highlights:
·; Crude steel output amounted to 2.984 mln tons in Q2 2010 which is 252 th. tons or 9% higher compared to Q1 2010.
·; Finished steel products output increased by 170 th. tons or 7% in Q2 2010 q-o-q and amounted to 2.623 mln tons.
·; Steel output growth is driven by increasing output of HVA products - mainly owing to the increasing thick plate production at Plate Mill 5000 (production grew by 52 th. tons or 29% in Q2 2010 q-o-q).
·; High value-added products output increased by 174 th. tons (or 24%) in Q2 2010, its share in finished products output grew from 30% to 35%.
·; MMK average steel price grew by 15.1% in Q2 2010 q-o-q and amounted to USD647 per ton.
·; Domestic shipments in Q2 2010 equaled to 1.712 mln tons to account for 71% of revenue.
·; Share of MMK domestic shipments in volume terms grew from 64% in Q1 2010 to 65% in Q2 2010.
Key Q2 2010 financial highlights:
Key Profit & Loss statement figures for Q2 2010
| RUR mln | Q2 2010 | Q1 2010 | +/-, % |
| Sales | 53 117 | 42 143 | 26% |
| Operating income | 9 109 | 5 946 | 53% |
| Net profit excluding revaluation of investment in securities | 4 678 | 3 783 | 24% |
| Revaluation of investment in securities | - 4 001 | 2 527 | - |
| Net profit adjusted for revaluation of investment in securities | 677 | 6 310 | -89% |
·; Q2 2010 sales amounted to RUR 53.117 bn which is 26% higher q-on-q. The increase is driven by growth of steel output and average steel price.
·; Operating income amounted to RUR 9.109 bn. Growth of 53% q-on-q is driven by increased output and finished steel products sales in Q2 2010 and also by growth of average steel price for 1 ton exceeding costs inflation.
·; MMK net profit was influenced significantly by the effect of revaluation of securities on company's balance sheet. Net profit grew by RUR 2.527 bn due to revaluation in Q1 2010, while in Q2 2010 revaluation of investment in securities led to net profit decrease of RUR 4.001 bn.
·; Net profit excluding revaluation of investment in securities increased by 24% in Q2 2010 q-on-q.
Balance sheet as of July 1, 2010 (compared to balance sheet as of January 01, 2010)
Total assets amounted to RUR272.588 bn, which is 12% higher compared to Jan 1, 2010. The increase of assets value in the amount of RUR 29.219 bn took place mainly in non-current assets in terms of investment program realization (construction and acquisitions of fixed assets).
Contacts
Evgeny Kovtunov
+7 3519 24 93 55
e-mail: kovtunov@mmk.ru
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About OJSC MMK
OJSC MMK is among the world's largest steel producers and is one of the leaders of Russia's steel industry. The company's operations in Russia include 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 higher value added goods. In 2009 the company produced 9.6 mln tonnes of crude steel and 8.8 mln tonnes of commercial steel products. MMK Group revenue in 2009 stood at USD 5.081 bn, EBITDA at USD 1.285 bn, profit for the period - USD 219 mln.