DTEK Energy coal mining falls 0.9% in 1H19

Ukraine’s leading coal and power producer DTEK Energy
(DTEKUA) mined  11.32 mmt of raw coal in 1H19, or 0.9% less yoy, according
to Concorde Capital calculations based on sector-wide data provided by Energy
Ministry. Its output was 5.9% less than the plan agreed with the ministry.

In June alone, DTEK Energy produced 1.88 mmt of coal,
which is 3.6% more yoy and 4.4% more compared to May, on a daily average basis.

Alexander Paraschiy: The interim result allows us to confirm our expectation that DTEK
Energy will cut its coal mining by 2.0% yoy in 2019 to about 23.6 mmt in 2019.
We remain bullish on DTEKUA Eurobonds, the fundamentals of which should benefit
from the liberalized electricity market in 2H19. As before, we see the
company’s reaching a deal to restructure the remainder of its outstanding debt
in the near future as the key price catalyst for the appreciation of its
Eurobond.