Yenakiieve Steel reports USD 31 mln profit in 2011

Yenakiieve Steel (ENMZ UK) posted a positive bottom line of USD 31 mln in 2011, vs. a net loss of USD 98 mln in 2010, according to preliminary figures in announcement for the company’s AGM on March 30.

Roman Topolyuk: The preliminary 2011 income figure implies USD 110 mln in net profit in 2H11, after USD 78 mln in losses in 1H11. We believe the reversal in 2H11 was due to a one-off P&L item, and is not fundamentally driven, as indicated by price trends for raw materials and finished products. Average prices for steel products remained flat in 2H11 compared to 1H11 (rebar products) or even corrected slightly (billets and rod by 1%, angle by 4%). On the inputs side, prices for iron ore concentrate and pellets appreciated 2% and 6% hoh, respectively, coke was almost flat, natural gas jumped 25% hoh, and electricity added 5% hoh.