Metinvest iron ore concentrate output declines 4% m/m in June

Metinvest’s (METINV) attributable production of iron ore concentrate before processing slid 4% m/m in June to 2.9 mmt (-7% yoy), according to Concorde Capital’s analysis of separate reports by Interfax-Ukraine. In 1H16, output of attributable concentrate decreased 1% yoy to 17.6 mmt. Output of merchant attributable products slid 1% to 16.9 mmt in 1H16, based on our estimates.

Roman Topolyuk: The decline in Metinvest’s iron ore mining might have been impacted by lower steel production during the same month, constrained by the logistics stalemate on the occupied territory since early June. The problem was solved by the end of the month and Yenakiyeve Steel has since increased its capacity load. This might support the operating performance of the mining division going forward. We are keeping our forecast of merchant attributable products output unchanged at 35.2 mmt in 2016, or 1% growth. Our view on Metinvest’s Eurobonds is positive.