Evraz 2009 Net Loss amounted to $1.26 Billion

According to Evraz Group S.A. press-service its consolidated revenues decreased by 52.1% to  $9.772 bn in 2009 compared with $20.380 bn in 2008. Net loss amounted to $1,26 bn compared with $1,859 bn net profit in 2008. Losses amounted to 3,10 per GDR (Global Depositary Receipt ) compared with $4,85 earnings per GDR in 2008.

Net loss was adversely affected by $1.054 bn negative effect of the revaluation of property, plant and equipment, caused by changes in accounting policy. Excluding this effect there would have been a net loss of $207 million.

Steel segment sales accounted for the majority of the decrease in revenues, largely due to lower average prices and sales volumes of steel products. Evraz’s sales volumes of steel products to third parties decreased from 17.0 million tonnes in 2008 to 14.3 million tonnes in 2009. The decrease in steel sales volumes primarily relates to a decline in demand for construction products in Russia with overall sales in the Russian market down by 2.4 million tonnes.

Sales volumes in Ukraine declined by 0.1 million tonnes. The decreases in the domestic markets were partially offset by the growth of export sales volumes from the Russian and Ukrainian operations, which increased by 0.8 million tonnes in total. Sales volumes of the European and South African operations declined by 0.3 million tonnes and 0.1 million tonnes respectively. The Canadian operations, which were acquired in June 2008, sold approximately the same steel volumes in 2009 as in 2008 post acquisition, while sales of the US operations decreased by 0.6 million tonnes. These decreases directly reflected the general slowdown in the steel markets in 2009 and related cuts in production volume.