CGOK net income grows 47% qoq in 9M13

Central Iron Ore (CGOK UK) increased its revenue 15% yoy to USD 527 mln in 9M13, its EBITDA rose 33% yoy to USD 245 mln, and net income jumped 47% to USD 142 mln (EPS of USD 0.12/share). In 3Q13, revenue grew 3% qoq to USD 184 mln, EBITDA declined 6% qoq to USD 80 mln, and net income increased 3% qoq to USD 46 mln.

Roman Topolyuk: In 3Q13, the average selling price of Central Iron Ore continued to grow for a second consecutive quarter (+12% qoq in 2Q13 and +7% qoq in 3Q13), contrasting from the market  (average market prices declined 2% in 2Q13 and 3% qoq in 3Q13). Despite the EPS of Central Iron Ore in 9M13 being significantly higher yoy already, we view this increase unsustainable and a return to paying out ample dividends for 2013 unlikely.