MMK Group Financial Statements

Q4 2018 highlights vs Q3 2018

The decrease in revenue for Q4 2018 was due to the fall in the average sale price of finished products against a backdrop of a seasonal decrease in sales of steel products. In Q4 2018, the cost of sales grew q-o-q, mainly due to higher prices of key raw materials on the domestic market.

As a result, EBITDA decreased by 20.0% on the previous quarter. EBITDA margin amounted to 27.4%.

Quarterly profit amounted to USD 245 mln. One-off factors that had an impact on profit include a positive FX effect of USD 39 mln, impairment of Steel (Turkey) segment in the amount of USD 258 mln and restoration of the provision created in 2013 for impairment purposes of Steel (Russia) segment in the amount of USD 256 mln. FCF amounted to USD 239 mln.

FY 2018 highlights vs FY 2017

Revenue grew 8.9% year-on-year (y-o-y), thanks to higher sales volumes on the back of increased
average sales prices by USD 46 per tonne, or 8.0%.

In FY 2018, EBITDA grew 19.0% y-o-y, while EBITDA margin amounted to 29.4%. This significant growth in EBITDA was due to finished product prices growing faster than raw materials prices, as well as share of HVA products reaching 46,5% of total Group sales.

Net income for the period grew by 10.8% y-o-y.

FCF for the period grew 48.0% y-o-y, amid favourable conditions in the Company’s key markets, high steel prices, and continued growth in operational efficiency