icon bookmark-bicon bookmarkicon cameraicon checkicon chevron downicon chevron lefticon chevron righticon chevron upicon closeicon v-compressicon downloadicon editicon v-expandicon fbicon fileicon filtericon flag ruicon full chevron downicon full chevron lefticon full chevron righticon full chevron upicon gpicon insicon mailicon moveicon-musicicon mutedicon nomutedicon okicon v-pauseicon v-playicon searchicon shareicon sign inicon sign upicon stepbackicon stepforicon swipe downicon tagicon tagsicon tgicon trashicon twicon vkicon yticon wticon fm

NLMK posts good 1Q results, indicating market recovery

NLMK posts good 1Q results, indicating market recovery
Major Russian metals producer Novolipetsk Steel (NLMK) reported a 13% growth in profit in the first quarter of 2012, despite a seasonal slowdown in demand and dropping metal prices.

­The group’s revenue increased up to $3.1 billion, showing 1.3% growth compared to the previous quarter supported by 9% sales growth, while the average steel prices dropped 5% during 1Q of 2012.

EBITDA – an indicator of a company’s net efficiency – increased 17% to $432 million as a result of reduced costs and improved sales efficiency. Cash flow from operations totaled $502 million and was up 57% compared to the results of the previous quarter because of higher profitability and working capital optimization.

“The results of the company show quite a good and stable situation at the metals market: demand for metal production is growing, though the pace is rather slow,” said Ilya Rachenkov from Investcafe.

Production grew 24.9% compared to the 1Q of 2011, up to 3.63 billion tonnes. Meanwhile the net debt burden was up 5% and totaled $3.5 billion, though $264 million was repaid in the first quarter.

“In Q2, we expect revenue growth of 10% based on continued increase in sales. We expect an EBITDA margin of approximately 17%-19%,” NLMK said in a statement.

Podcasts