Metinvest subsidiary Pokrovske Coal output rises 16% in 7M21

Private joint stock company Pokrovske Coal produced
3.83 mmt of raw coking coal (18.1 kt per day) in 7M21, a 16.2% yoy rise,
according to Concorde Capital’s analysis of Ukraine’s Energy Ministry data.

 

In July, daily coal production rate at Pokrovske Coal
dropped 22.1% m/m to 14.9 kt.

 

In 2020, Pokrovske Coal’s output was 6.13 mmt of raw
coking coal (16.8 kt per day), a 22.6% yoy rise. In 2019, Pokrovske Coal
produced 5.0 mmt of coal (13.7 kt per day), a 25.8% yoy jump.

 

Metinvest (METINV), Ukraine’s largest steelmaker, in
March increased its effective interest
in the so-called Pokrovske coal business, which includes Pokrovske Coal, to a
controlling stake.

 

Pokrovske Coal intended to launch four new longwalls,
three in July and one in August, with the total reserves of 5.3 mmt of raw
coal, according to a June 25 report by GMK Center, an industry consultancy.

 

Pokrovske Coal will increase its coal mining volume by
25% yoy in 2021, according to Metinvest’s CEO Yuriy Ryzhenkov, Interfax-Ukraine
reported on June 23.

 

Dmytro Khoroshun: The July
m/m drop in daily production rate was unexpected, but the company might boost
production later in the coming months, when new longwalls are launched.

 

Pokrovske Coal’s 2021 output will amount to 6.9-7.7
mmt (19-21 kt per day), or 13-25% more yoy, we continue to expect.

 

We maintain our neutral view on METINV bonds.