MMK announces 2007 results

17 Mar 2008 11:40

OJSC Magnitogorsk Iron &Steel Works17 March 2008 Press Release March 17, 2008 Magnitogorsk Open Joint Stock Company Magnitogorsk Iron and Steel Work, one of the leadingintegrated steel making companies, announces the results of its consolidatedfinancial statements for the 12 months 2007 according to US GAAP. • The revenue of MMK Group of Companies in the 12 months of 2007 increased by 27.6% compared to the 12 months of 2006 and amounted to USD 8 197 million. • The operating income reached USD 2,079 million or 25.4% of the revenue. The growth compared to the 12 months 2006 amounted to 17.8%. • The consolidated net income of the Company in the 12 months 2007 increased by 24.3% against the same period of last year and amounted to USD 1,772 million, i.e. USD 0.164 per share. The net income accounted for 21.6% of the revenue. • EBITDA for the 12 months 2007 reached USD 2,342 million or 28.6 % of the revenue. Compared to the 12 months of 2006 EBITDA of the Company increased by USD 337 million or 16.8%. Growth of crude steel production at OJSC MMK by 6.5 % secured by increasingproduction at the new electric arc furnaces, allowed to raise the output andsales of steel products by 6.8% (in tons) against the previous year. Costs increase in 2007 mainly related to raw material price rise was compensatedby the growth of average prices for steel products. Thus the average price ofshipped steel products, produced by OJSC MMK, increased by USD 92 or 18.6% andreached USD 589 per ton. The average price growth is due to the world steelmarkets conditions and increasing sales in the domestic market where the averageprice of shipped steel products in 2007 was USD 154 per ton higher than in theexport market. A certain decline of relative profitability in 2007 against the previous yearwas made up by the absolute growth of revenue and income as well as increasedearnings and income per ton of produced steel. Thus EBITDA per tone of steelproduced increased by USD 16 or 9.7 %. Growth of net earnings per share amounted to USD 0.024 or 17.1%. The MMK Group financial performance is characterized by high liquidity and lowdependency on external sources of financing. Cash expenditures for investments in fixed and intangible assets andacquisitions of subsidiary companies in the 12 months 2007 amounted to USD 1,317million. Dividend payments under OJSC MMK's shares for 12 months 2007 amounted to USD 547million (excluding dividends under treasury shares). About MMK The Magnitogorsk Iron and Steel Works OJSC (MMK) ranks 20th among the world'slargest steel producers (according to IISI) and is one of the leaders of Russia's steel industry (according to Chermet data). The Company is a large steelproducing complex encompassing the entire production chain, from preparation ofiron ore to downstream processing of rolled steel. MMK turns out a broad rangeof steel products with a predominant share of value added goods. In 2007 theCompany produced 13.2 m tons of crude steel, and 12.2 m tons of commercialproducts. Head of Investor Relations Evgeny Kovtunovemail: kovtunov@mmk.rutel: +7 3519 24 9355fax: +7 3519 24 9360 Press SecretaryElena Azovtsevaemail: azovtseva@mmk.rutel: +7 3519 24 9082 This information is provided by RNS The company news service from the London Stock Exchange