DTEK boosts March hard coal mining to all-time high

Ukraine’s leading coal and power holding DTEK Energy
(DTEKUA) produced 2.12 mmt of raw coal in March 2018, Concorde Capital
calculated based on sector-wide data provided by the Energy Ministry on April
17. This is 2.2% more yoy on a like-for-like basis and 2.3% more than February,
on a daily average basis. In 1Q18, the company produced 5.76 mmt of hard coal,
or 2.0% less yoy.

Ukraine’s total mining of steam coal was 6.74 mmt in
1Q18, or 1.3% more on a like-for-like basis, with DTEK’s share falling to 85%
from 88% a year before.

Alexander Paraschiy: March’s
result is an all-time high for hard coal mining by DTEK and also the first time
its monthly hard coal mining exceeded 2.1 mmt. Yet in terms of daily average
output, the March result (68.5 kt) still lags the November 2017 record of 69.8
kt. The result was achieved by increased mining operations at its
Bilozerska mine in late February as it has
recently launched two new operational longwalls. March’s data again confirms
the feasibility of DTEK Energy’s guidance to boost hard coal mining by 7.3% yoy
to 24.6 mmt in 2018. We remain neutral on DTEKUA bonds.