Yenakiieve Steel EBITDA improves, still negative in 2011

At an AGM last week, Yenakiieve Steel (ENMZ UK) announced its 2011 financials:  revenue grew 54% yoy to USD 1.7 bln, while EBITDA improved 22% yoy to negative USD 125 mln. “Other financial income” of USD 236 mln allowed the company to post a positive bottom line of USD 31 mln in 2011, following a USD 98 mln net loss in 2010. Shareholders decided not to pay dividends. According to a separate management statement, Yenakiieve Steel increased CapEx 39% yoy to USD 92 mln in 2011. The company plans to continue preliminary design work on a third continuous caster and pulverized coal injection unit (PCI).

Roman Topolyuk: The released financials confirmed our expectation that the company ended the year with a profit due to a non-operating item. The positive bottom line allowed Yenakiieve Steel to reduce the accumulated loss on its balance sheet 44% yoy to USD 46 mln. Since the latter accounting item is still negative, we expect some profit in upcoming reporting periods not related to the company’s steelmaking business.