Metalloinvest (the "Company"), a leading global iron ore and hot briquetted iron (HBI) manufacturer and supplier and one of the regional high-quality steel producers, today announces IFRS financial results for the 1H ended June 30, 2021
Key indicators of 1H 2021
- Revenue reached $ 5,064 mln, up 64.7% compared to 1H 2020 against the background of favorable pricing environment in the iron ore and metallurgical products market). The share of the Russian market in revenue increased to 37%.
- EBITDA amounted to USD 2,916 mln, which is 175.4% higher than the level in 1H 2020 and exceeds the indicator for the entire 2020. also the effect of the implementation of measures to improve operational efficiency.
- EBITDA margin reached the highest value in the history of the Company, increasing by 24.5 p.p. compared to 1H 2020 to 61.0%.
- Net profit reached $ 2,167 million, an increase of 308.8% compared to 1H 2020.
- Net debt as of June 30, 2021 amounted to $ 2,592 million, having decreased by 20.0% compared to December 31, 2020
- LTM Net Debt /EBITDA ratio was 0.6x versus 1.3x as of December 31, 2020
- Capital expenditures reached $ 316 million, which is 51.3% more than in the same period last year. The growth was due to the technical re-equipment of the mining and transport complex in terms of the purchase of special equipment, the implementation of development projects and an environmental program aimed at reducing the impact on the environment.
Nazim Efendiev, General Director of Metalloinvest "Commented:
" In the first half of 2021, we have witnessed an impressive recovery in business activity and industrial production around the world. The implementation of deferred demand, as well as various stimulating measures taken by a number of leading countries, including Russia, allowed to ensure a high utilization of production capacities along the entire chain of the mining and metallurgical sector. As a result, against the background of the outstripping growth of steel consumption in the world relative to production, an exceptionally favorable pricing environment has developed in the Company's main sales markets. This factor, combined with the efforts of management to control costs and implement best practices in the area of operational efficiency, allowed the Company to demonstrate a convincing growth in financial performance in the reporting period. In addition, due to strong cash flow, the Company reduced its net debt by 20%, which ensured an extremely low level of debt burden - 0.6x in terms of Net Debt /EBITDA LTM. The strong results and steadily improving business profile of the Company, focused on high quality products for the "green" metallurgy, do not go unnoticed by the leading rating agencies. An important milestone in the 10-year presence of Metalloinvest on the public debt capital market was the assignment of an investment rating to the Company by Fitch in June this year. The COVID-19 pandemic continues to be one of the main constraints to business as usual in the world. The health of our employees is our top priority and the Company continues to implement all necessary measures to ensure continuous production and timely implementation of the capital expenditure program. Vaccinations have been carried out at the Company's enterprises since January. Today 70% of employees are vaccinated. "
Key corporate events
Operations and development projects
- Production volume iron ore amounted to 20.4 million tonnes, an increase of + 1.2% compared to 1H 2020.
- Pellet output remained at the level of the previous year and amounted to 14.1 million tonnes.
- В As part of the contract renewal process, the Company entered into long-term contracts with key clients.
Financial activities
- Full early redemption of ruble bonds of the series BO-02 and BO-08 for a total amount of 15 billion rubles.
- The Company refinanced pre-export financing credit lines PXF-2017 and PXF-2018 by attracting PXF-2021 in the amount of 350 million dollars
- The credit rating of the Company has been increased from the international rating agency Fitch to investment grade “BBB-” with a stable outlook.
- The international rating agency S&P has increased the outlook for the credit rating of the Company from stable to positive and affirmed the rating at “BB +”.
- Russian rating agency ACRA raised the outlook on the Company's credit rating from stable to positive and affirmed the rating at “AA + (RU)”.
Sustainable Development
- The Company's Climate Strategy was approved and the intention to achieve carbon neutrality by 2050 was announced
- The decision was made on an increase in the payroll of the Company's employees by 5% from March 2021
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