Khartsyzk Pipe income surges 8.3x yoy in 2014
3 March 2015
Large-diameter steel pipe maker Khartsyzk Pipe (HRTR UK), a subsidiary of Metinvest (METINV), reported net income of UAH 357 mln in 2014, a 8.3x yoy surge, according to a March 2 announcement of an AGM scheduled for April 3. The company’s retained earnings amounted to UAH 828 mln as of end-2014, up 105% yoy. The Khartsyzk Pipe plant is located in the separatist-controlled territory of the Donetsk region.
Roman Topolyuk: The improvement of Khartsyzk Pipe’s bottom line occurred against a 6% yoy decrease in pipe production to 241 kt. Most probably, it stems from better reporting practices, specifically in higher reported selling prices, subject to be confirmed in the full set of financial statements to be published after the AGM.
The company’s bottom line implies EPS of UAH 0.137/share, which is a quarter of HRTR market price (UAH 0.55/share). The company used to be a generous dividend payer, but we doubt its AGM will decide to distribute earnings among shareholders this year. The company’s market outlook is far from bright, and the enterprise’s operations are under certain constraints since it is located on the occupied territory.
