Metinvest subsidiary Pokrovske Coal output rises 21% in 5M21

Private joint stock company Pokrovske Coal produced
2.80 mmt of raw coking coal (18.5 kt per day) in 5M21, a 21.0% yoy rise,
according to Concorde Capital’s analysis of Ukraine’s Energy Ministry data.

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 intends 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: 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.