Ferrexpo pellet output rises 3% m/m in February

Ukraine’s largest iron ore pellet exporter Ferrexpo (FXPO LN, FXPOLN) produced 840 kt of pellets in February, Interfax-Ukraine reported on March 15. Pellet production rose 3% m/m to 30 kt per day. Iron ore concentrate production by Ferrexpo amounted to 1,030 kt in February, which is a 9% m/m increase on a daily average basis.

Andriy Perederey: Ferrexpo’s operating performance has improved on an average daily basis in February but some maintenance work at the company’s assets is still ongoing, preventing the company from operating at full capacity. This work will be performed till the end of 1H16, Concorde Capital learned from the company. So we are downgrading our projection for Ferrexpo’s 2017 output to about 11.3 mmt of iron ore pellets (from 11.7 mmt), which would be a 0.9% yoy improvement. We retain our neutral view on Ferrexpo bonds.