DTEK Energy increases hard coal mining 8.2% in 2017
Ukraine’s leading coal and power holding DTEK Energy (DTEKUA) produced 22.91 mmt of hard steam coal in 2017, Concorde Capital calculated based on sector-wise data published by Interfax-Ukraine on Jan. 9. This implies 8.2% growth yoy and slightly less than DTEK’s guidance of 23.0 mmt. In December alone, DTEK mined 64.9 kt of hard coal per day, which is 2.1% more yoy but 7.0% less compared to November.
Total coal mining by DTEK in Ukraine amounted to 24.82 mmt in 2017 (15.0% less yoy), including results from anthracite mines located on the occupied territory of Donbas that the holding has not controlled since mid-March 2017.
Alexander Paraschiy: While December’s decline in DTEK’s coal output is discouraging, the holding’s annual result is broadly in line with our estimate. We therefore confirm our estimate of DTEK’s 2017 EBITDA of UAH 17.7 – 18.0 bln, as well as re-iterate our bullish view on DTEKUA bonds. In the year 2018, we expect DTEK will further increase the mining of hard steam coal, with a growth rate of at least 8% yoy.