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DTEK boosts coal production 21% yoy at remaining mines in 5M17

DTEK Energy (DETKUA) boosted its coal production 5.0% yoy to 11.6 mmt in 5M17, Concorde Capital calculated based on sector-wide data published by Interfax-Ukraine on June 14. The increase happened despite DTEK having lost control over its three mines located on the occupied territory of Ukraine since mid-March. The remaining mines produced 9.7 mmt of hard steam coal in 5M17, or 20.8% growth yoy.

 

In May alone, DTEK Energy’s remaining mines produced 1.93 mmt of coal, which is 0.8% more m/m and 73% more yoy.

 

Alexander Paraschiy: The yoy increase in coal production at DTEK’s remaining mines is mostly the result of a low comparison base: in 5M16, the same mines reported a 14% yoy decline in coal production, which was prompted by the Energy Ministry's plans at the year's start for reduced demand for hard steam coal. (The ministry ended up revising its demand higher halfway through the year.) Compared to 5M15, DTEK’s remaining mines increased coal production by just 4.2% in 5M17. Based on recent data, we expect that DTEK Energy’s remaining mines will be able to produce about 23 mmt of hard steam coal in 2017 (or roughly 9% more yoy), which is fully in line with our previous estimates.

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