OMK expects revenue to drop by 7-8% in 2011

United Metallurgical Company’s revenue in 2011 may decrease by 7-8%, informed Vladimir Markin, the Company’s President.

According to Mr. Markin, decrease in net income and EBITDA for the current year is expected to reach 15%, compared to 2010.

In 2010, company’s revenue amounted to 118 billion rubles; net profit reached 26 billion rubles; EBITDA: 37 billion rubles.

“Reducing rates is related to a decreased utilization capacity in the second half of this year, especially large-diameter pipes. However, this did not happen due to the cancellation of the pipe projects, rather because of the adjustment of the projects start-up; Gazprom – in the first place”, said Mr. Markin, noting that these projects are expected to be launched in the second quarter of next year.

Furthermore, according to Mr. Markin, due to decrease in the production of large-diameter pipes, a decrease in production volumes in 2011 is also expected. Mr. Markin also noted that the OMK’s revenue for the nine months of 2011 amounted to about 70 billion rubles.

United Metallurgical Company (OMK) – is one of the largest Russian manufacturers of pipes, railroad wheels and other metal products for power-engineering, transportation and other industries. OMK comprises four major steel enterprises: Vyksa Steel Works, Almetyevsk Pipe Plant, Trubodetal and OMK-STEEL Casting and Rolling Complex