MMK.L Regulatory News (MMK)

17 Jan 2008 11:32

OJSC Magnitogorsk Iron &Steel Works17 January 2008 Magnitogorsk Iron & Steel Works (MMK) announces its production results for the4th quarter and 12 months of 2007 1. Production Major products output 4Q2007 3Q2007 Change Y2007 Y2006 Change '000 tons '000 tons % '000 tons '000 tons % Cast iron 2 285 2 546 -10,3% 9 482 9 733 -2,6%Crude steel 3 327 3 458 -3,8% 13 261 12 455 6,5%Finished productsoutput 3 106 3 146 -1,3% 12 203 11 346 7,6% 4Q2007 3Q2007 +/- Y2007 Y2006 +/- '000 tons '000 tons '000 tons '000 tons '000 tons '000 tonsFinishedproductsoutput,including: 3 106 3 146 -39 12 203 11 346 857Slabs andbillets 388 321 67 976 332 644Long products 404 449 -45 1 788 1 706 81Flathot-rolledproducts 1 548 1 584 -37 6 391 6 095 296Flatcold-rolledproducts 409 396 12 1 563 1 634 -71Downstreamproducts 0Tin plate 52 72 -20 249 287 -38Galvanizedsteel 109 110 -1 426 441 -14Galvanizedcolour-coatedsteel 42 46 -5 179 166 13Band 83 85 -2 336 338 -2Formed section 54 63 -10 219 198 21Pipes 18 19 -1 74 81 -7MKZ band - - - 0 67 -67 Steel products output of MMK grew by 7.6% in 2007 compared to 2006 and amountedto 12.2 mln tons. It is the record level of production in MMK history. The slight decrease of cast iron output is due to repairs and upgrading of blastfurnaces. The crude steel production increased by 6.5% year-on-year because ofincreasing production at the electric arch furnaces. The faster growth of steelmaking capacity compared to MMK's present rolling capacity led to growth incommercial slabs and billets production. Extension of long products andcolour-coated steel output is also due to reaching full capacities of theproduction facilities. The demand factor influenced the production volumes oftin plate and formed sections. The cast iron output came slightly down in Q4 2007 because of reconstructionworks at blast furnace #9 which has the highest production capacity.Insignificant production decrease of hot-rolled steel and formed sections isalso called forth by planned repairs of the facilities; reduced long-productsand colour-coated steel output is accounted for by seasonally weakening demandfor these product types. 2. Average prices The prices are indicative and do not consider either steel grade and qualitycharacteristics or sales markets. Average prices calculation is based ondivision of revenue by volume. 4Q2007 3Q2007 Change Y2007 Y2006 Change USD/ton USD/ton % USD/ton USD/ton % Slabs and billets 441 431 2,3% 419 353 18,7%Long products 603 620 -2,7% 587 428 37,1%Flat hot-rolled products 570 561 1,7% 550 455 21,0%Flat cold-rolled products 612 603 1,3% 598 500 19,7%Downstream products Tin plate 857 857 0,0% 848 844 0,5%Galvanized steel 896 937 -4,4% 926 853 8,5%Galvanized colour-coatedsteel 1 194 1 280 -6,7% 1 225 1 018 20,4%Band 683 660 3,4% 664 582 13,9%Formed section 813 791 2,9% 769 634 21,3%Pipes 695 747 -7,0% 731 600 21,8%MKZ band - - - 510 498 2,5% Prices continued to be in the growth phase in 2007. The average prices growthfor MMK in 2007 compared to 2006 is first of all related to the shift in thegeographical sales of its products towards the domestic market. The latter istraditionally characterized by higher price levels. The share of MMK domesticsales amounted to 60% in 2007 while the absolute production figure grew by 857thousand tons. Seasonal weakening of construction influenced the demand for constructionproducts (long products, galvanized steel, colour-coated steel and pipes) whichled to slight decrease in prices for these product types in Q4 compared to Q3. Contacts: Investor relationsEvgeny KovtunovTel.: +7 3519 24 93 55E-mail: kovtunov@mmk.ru Press serviceElena AzovtsevaTel.: +7 3519 24 90 82Fax: +7 3519 24 80 24E-mail: azovtseva@mmk.ru This information is provided by RNS The company news service from the London Stock Exchange