Severstal reports Q4 & FY2019 operational results

Severstal announces its operational results for Q4 and FY2019.

Q4 2019 GROUP HIGHLIGHTS

Hot metal output declined 4% q/q in Q4 2019 to 2.36 mln tonnes (Q3 2019: 2.46 mln tonnes) due to short-term maintenance works at blast furnace facilities in Q4 2019. Crude steel production declined 10% to 2.71 mln tonnes (Q3 2019: 3.03 mln tonnes) affected by short-term maintenance works at the BOF and EAF facilities and lower EAF production in Q4 2019 following the sale of the Balakovo mini-mill in the previous quarter.
Consolidated steel product sales declined 6% q/q to 2.65 mln tonnes in Q4 2019 (Q3 2019: 2.83 mln tonnes). The Company increased the share of steel export shipments to 41% (Q3 2019: 33%) responding to a seasonal slowdown in domestic demand.

The share of high value-added (HVA) products within the sales portfolio remained at 45% (Q3 2019: 45%), supported by higher sales of hot rolled thick plate and cold rolled coil products and declining volumes of long and hot rolled coil sales.

Coking coal concentrate sales volumes from Vorkutaugol declined 1% q/q due to a decrease in run-of-mine production q/q.

Iron ore pellet sales grew 14% to 2.81 mln tonnes (Q3 2019: 2.46 mln tonnes) reflecting higher production of pellets at Karelsky Okatysh. Iron ore concentrate sales volumes declined 17% to 1.60 mln tonnes (Q3 2019: 1.93 mln tonnes) driven by a decline in iron ore volumes at Karelsky Okatysh.

FY2019 GROUP HIGHLIGHTS

Hot metal output increased 4% y/y to 9.49 mln tonnes in 2019 (FY2018: 9.15 mln tonnes) driven by improved efficiency arising from maintenance works and higher quality raw materials. Crude steel production in 2019 declined 2% to 11.85 mln tonnes (FY2018: 12.04 mln tonnes), as higher aggregate productivity levels were offset by lower EAF production in H2 2019 following the sale of the Balakovo mini-mill.
Coking coal concentrate sales volumes from Vorkutaugol surged 38% y/y, as a result of planned production growth.

Iron ore concentrate sales volumes increased 14% y/y to 6.26 mln tonnes (FY2018: 5.51 mln tonnes) predominantly reflecting production volumes growth at Karelsky Okatysh and the Yakovlevskiy mine. • The share of HVA products remained high at 45% in FY2019 (FY2018: 46%), reflecting higher sales of thick plate, as well as galvanised and colour-coated products following the launch of new product lines, which reached full utilisation in the beginning of 2019.

In 2019 the share of domestic shipments reached 65% (FY2018: 61%) due to more attractive pricing in the Russian market.