Yenakiieve Steel cuts losses 4% yoy in 1H13
25 July 2013
Yenakiieve Steel (ENMZ UK) cut its 1H13 net loss by 4% yoy to USD 104 mln, according to its second-quarter financials released on July 23. Its negative EBITDA improved to USD 6.6 mln in 1H13 from USD 52.9 mln a year before, while revenue declined 8% yoy to USD 764 mln, despite 4% higher yoy steel products output. In 2Q13, Yenakiieve reported negative EBITDA of USD 12.1 mln (compared to a positive number of USD 5.5 mln in 1Q13), and a net loss of USD 60 mln (vs. minus USD 44 mln).
Roman Topolyuk: Yenakiieve reduced its net losses and negative EBITDA in 1H13 because steel billet prices decreased more slowly (-13% yoy to USD 517/t in 6M13) than iron ore prices did (-15% and -23% yoy for iron ore concentrate and pellets respectively). We attribute the company’s worsened financials in 2Q13 to a 6% qoq decline in billet prices. We also note that steel product prices show some signs of recovery (July’s billet prices already grew 3% mom to USD 506/t) and therefore expect Yenakiieve will post better financials in 3Q13.
