In the first quarter of 2021, the Ukrainian industrial company Interpipe Viktor Pinchuk was forced to operate in a difficult market environment, which negatively affected its financial performance, according to the financial results of Interpipe published today for the first 3 months of 2021.
The company's total revenue decreased by 20% year-on-year to $ 201 million. The drop in sales was primarily due to a reduction in the segment of railway products after the imposition of an embargo on the import of railway products from Ukraine to the Russian Federation.
“On February 9, 2021, Russia imposed an embargo on the import of Ukrainian railway products, which led to a significant decrease in indicators in the first quarter. However, already in the first months of the second quarter of 2021, the company managed to redirect the sales of wheels lost due to the Russian embargo to other countries: the USA, CIS, Europe and India, having almost reached the monthly production level before the embargo was imposed, ”said Fadi Hraibi, General Director of Interpipe.
Interpipe's revenue in the railway segment fell 53% yoy, while sales volumes fell 32%. As a result, the company's total underlying profit (EBITDA) for 3 months of 2021 fell by 53% to $ 40 million.
The company stressed that the negative situation is further undermined by the continuing rise in world prices for raw materials and steel products, as the selling prices for pipes and railway products lagged behind the rise in production costs.
As of March 31, 2021, Interpipe reduced its total debt to USD 110 million following the full redemption of the 2024 Notes on January 26, 2021, while maintaining the consolidated net leverage ratio at a negligible 0.2x.