Ferrexpo pays USD 103 mln to creditors in 4M16

Iron ore miner and pellet maker Ferrexpo (FXPOLN, FXPO LN) repaid USD 103 mln in debt amortization and interests between January and April 2016, the company reported on May 19, as an update to its AGM. The company also offered insight into its operating performance as sales volumes have been supported by strong demand for pellets, according to its statement, which didn’t include details. Ferrexpo stated it made shipments to new high-quality customers in Western Europe and Southeast Asia, most likely in March and April 2016.

Pellet production costs continued to fall in 1Q16, but increased marginally in April following a recovery in oil prices, the company reported, without disclosing exact numbers.

Roman Topolyuk: The key points of this report are in line with our overall view on Ferrexpo and projections of USD 313 mln EBITDA in 2016 (flat yoy). As we interpret it, the company could have sold some pellet stocks during 4M16 (its production slid 1.7% yoy to 3.9 mmt due to maintenance), thus keeping its sales volumes stable yoy during the period. We reiterate our neutral view on Ferrexpo’s Eurobonds.