EVRAZ update on steel segment result

Evraz announces steel segment result



2010 2009 Change

Revenues 5,796 4,291 35.10%

Profit/(loss) from operations 1 -882 N/A

Adjusted EBITDA 738 389 89.70%


In USD million

Steel segment revenues increased by 35.1% to USD 5,796 million in the first six months of 2010 compared with USD 4,291 million in the first six months of 2009, a reflection of positive price dynamics for steel products and higher sales volumes.

The proportion of revenues attributable to sales of construction products increased as a result of a significant growth in the sales volumes and prices of construction products in Russia.

The proportion of revenues attributable to sales of railway products decreased despite an increase in the proportion of volumes, explained by the fact that prices of railway products, particularly rails in Russia, are relatively more stable and less affected by steel market price fluctuations.

The proportion of revenues attributable to sales of flat-rolled products increased in response to a significant advance in sales volumes across the Group’s North American, European and South African operations. The proportion of revenues attributable to sales of tubular products decreased primarily due to lower sales volumes and prices of large diameter pipes in North America despite a 12% growth in total sales volumes of tubular products.

The proportion of revenues attributable to sales of semi-finished products decreased largely due to a re-allocation of sales volumes by the Russian operations from export markets to the domestic construction sector. Steel segment sales to the mining segment amounted to USD 57 million in the first half of 2010 compared with USD 37 million a year earlier. The increase is attributable to higher sales prices and volumes.

Revenues from sales in Russia amounted to approximately 33% of steel segment revenues in the first six months of 2010, compared with 27% in the first six months of 2009. The increased share of revenues from sales in Russia resulted from the reallocation of steel volumes from Asian export markets to the Russian market.

Posted in: steel guru