TIDMEVR
RNS Number : 3393T
Evraz Plc
17 July 2015
EVRAZ Q2 2015 PRODUCTION REPORT
17 July 2015 - EVRAZ plc (LSE: EVR) today releases its
operational results for the second quarter of 2015.
Q2 2015 vs Q1 2015 OPERATIONAL HIGHLIGHTS:
-- Consolidated crude steel output reached 3.4 million tonnes in
Q2 2015, down 14% QoQ as a result of deconsolidation of EVRAZ
Highveld Steel and Vanadium (EHSV) as well as repair and
maintenance works at Russian steel mills.
-- Production of steel products, net of re-rolled volumes, went
down by 14% QoQ as a result of the above-mentioned two factors as
well as softer demand for tubular goods in North America.
-- The share of finished steel products within consolidated
volumes grew to 65% in Q2 2015 from 61% in Q1 2015 due to lower
production of semi-finished products in Russia resulting from
shutdowns of billet casters for maintenance and a better demand for
construction and railway products in Russia.
-- Production volumes of railway products rose driven by
increased orders by Russian Railways and other CIS customers and
continued demand from Class 1 railroads in the USA.
-- Production of tubular goods in North America declined as
lower energy exploration activity, de-stocking at distributors, and
usual spring break-up negatively affected OCTG demand.
-- Consolidated raw coking coal output and production of coking
coal concentrate declined by 30% and 8% respectively QoQ due to
lower output of both the Raspadskaya coal company and
Yuzhkuzbassugol as a result of scheduled longwall moves and
adjustment of production plans in response to weak market
conditions.
STEEL
Product, '000 tonnes Q2 2015 Q1 2015 Q2 2015/ Q1 2015, H1 2015 H1 2014 H1 2015/ H1 2014,
change change
------------------------ -------- -------- ------------------------ -------- -------- ------------------------
Coke (saleable) 286 285 0.5% 571 528 8.0%
Pig iron 2,811 3,131 -10.2% 5,942 6,123 -3.0%
Pig iron (saleable) 165 71 133.7% 236 163 44.9%
Crude steel 3,380 3,914 -13.7% 7,293 7,792 -6.4%
Steel products, gross* 3,328 3,802 -12.5% 7,130 7,593 -6.1%
Steel products, net of
re-rolled volumes** 3,150 3,640 -13.5% 6,791 6,922 -1.9%
Semi-finished
products *** 1,109 1,433 -22.6% 2,543 1,921 32.4%
Finished products 2,041 2,207 -7.5% 4,248 5,001 -15.1%
Construction products 1,126 1,183 -4.8% 2,310 2,553 -9.5%
Railway products 427 400 6.9% 827 1,043 -20.7%
Flat-rolled products 166 207 -19.9% 373 572 -34.8%
Tubular products 173 255 -32.2% 428 523 -18.2%
Other steel products 148 162 -8.6% 310 310 0.0%
------------------------ -------- -------- ------------------------ -------- -------- ------------------------
Note. Numbers in this table and the tables below may not add to
totals due to rounding.
* Gross volume of steel products in the tables includes those
re-rolled at other EVRAZ's mills. However, such volumes are
eliminated as intercompany sales for purposes of EVRAZ's
consolidated operating results.
** Includes production volumes of EVRAZ Vitkovice Steel disposed
of in April 2014 and of EVRAZ Highveld Steel and Vanadium (EHSV)
which are not consolidated starting from April 2015 due to business
rescue proceedings .
** Consolidated production volumes of semi-finished products are
preliminary as Q2 2015 intra-group re-rolling volumes are yet to be
finalised.
RUSSIA
Product, '000 tonnes Q2 2015 Q1 2015 Q2 2015/ Q1 2015, H1 2015 H1 2014 H1 2015/ H1 2014,
change change
------------------------ -------- -------- ------------------------ -------- -------- ------------------------
Coke (saleable) 96 76 26.1% 173 198 -12.5%
Pig iron 2,553 2,744 -6.9% 5,297 5,282 0.3%
Pig iron (saleable) 142 49 192.2% 190 149 27.8%
Crude steel 2,697 3,055 -11.7% 5,752 5,871 -2.0%
Steel products, gross 2,562 2,868 -10.7% 5,430 5,485 -1.0%
Steel products, net of
re-rolled volumes 2,500 2,795 -10.6% 5,296 5,311 -0.3%
Semi-finished
products 1,092 1,414 -22.8% 2,507 2,180 15.0%
Finished products 1,408 1,381 2.0% 2,789 3,130 -10.9%
Construction
products* 991 981 1.0% 1,973 2,102 -6.2%
Railway products 281 258 9.2% 539 771 -30.1%
Other steel
products 135 142 -4.5% 277 257 8.0%
------------------------ -------- -------- ------------------------ -------- -------- ------------------------
* Includes 73kt and 64kt produced in Q1 2015 and Q2 2015
respectively by EVRAZ Caspian Steel mill in Kazakhstan
In Q2 2015, as a result of planned capital repair works of EVRAZ
ZSMK's blast furnace 3 (14 days) and EVRAZ NTMK's blast furnace 6
(5 days) Russian steel mills produced 12% less crude steel and 11%
less steel products than in Q1 2015.
Production of semi-finished steel products decreased by 23% QoQ
due to shortage of pig iron, scheduled shutdown for reconstruction
of a billet caster at EVRAZ ZSMK and a 5-day maintenance of a
billet caster at EVRAZ NTMK.
Production of construction products grew by a moderate 1% QoQ
reflecting some revival of domestic demand in the beginning of the
construction season compared to seasonally weak Q1 2015.
Production of railway products, including rails, advanced by 9%
due to larger shipments of rails and freight wheels to Russian
Railways and stronger demand from the CIS clients.
In Q2 2015, prices for semi-finished products decreased in line
with global benchmarks. Due to the Russian rouble appreciation,
prices for construction products in US dollars terms were broadly
unchanged QoQ.
Prices for railway products in US dollar terms improved due to
changes in the product mix and the stronger rouble.
Average selling prices
USD/tonne (ex works) Q2 2015 Q1 2015 H1 2015 H1 2014
-------------------------- -------- -------- -------- --------
Coke 136 85 114 130
Pig iron 205 206 205 306
Steel products
Semi-finished products 278 303 292 417
Construction products 419 418 418 594
Railway products 611 512 564 792
Other steel products 462 421 440 603
-------------------------- -------- -------- -------- --------
NORTH AMERICA
Product, '000 tonnes Q2 2015 Q1 2015 Q2 2015/ Q1 2015, H1 2015 H1 2014 H1 2015/ H1 2014,
change change
------------------------ -------- -------- ------------------------ -------- -------- ------------------------
Crude steel 428 477 -10.3% 905 971 -6.8%
Steel products, net of
re-rolled volumes 541 615 -12.0% 1,156 1,260 -8.2%
Construction products 56 76 -26.3% 132 165 -19.9%
Railway products 146 142 2.8% 288 271 6.2%
Flat-rolled products 166 142 16.9% 308 301 2.4%
Tubular products 173 255 -32.2% 428 523 -18.2%
------------------------ -------- -------- ------------------------ -------- -------- ------------------------
* Q2 2015 and H1 2015 production volumes are preliminary
During Q2 2015, the Company scheduled a 12-day maintenance
outage at the Regina steel making facility and a 7-day outage at
the Pueblo steel production facility which resulted in a 10%
decrease in crude steel output compared to the previous
quarter.
Within construction products, the Company sees strong underlying
demand for rebar and wire rod, however high import levels continue
to pressure down prices and volumes for North American
producers.
Construction products (wire rod and HSS) output for the quarter
declined 26% as a result of lower wire rod production and the sale
of the Portland's structural tubing facility in March 2015 (which
accounted for 12 thousand tonnes in the first quarter). The terms
of sale for the structural tubing facility included a supply
agreement for coil and therefore these volumes form part of
Flat-rolled products starting in the second quarter.
Rail production further grew by 3% QoQ supported by continued
demand from Class 1 railroads.
In Flat-rolled products, the market continued its de-stocking
cycle. Third party saleable production for this segment increased
17% as volumes previously consumed by EVRAZ North America's OCTG
and hollow structural shapes mills declined. During the quarter,
the Company scheduled maintenance outages at the Portland and
Regina mills. At Portland, a 17-day outage originally scheduled in
the fourth quarter to perform a large portion of the work required
to re-line the re-heat furnace was pulled-ahead into the second
quarter. The balance of the work will be completed either during Q4
2015, or Q1 2016 depending on market conditions. In Regina, the
Company carried out a 12-day outage to perform maintenance and
carry out detailed engineering associated with the announced
upgrades at the Regina steel making and rolling mills.
During Q2 2015, demand for OCTG products was exceptionally low
as a result of de-stocking at distributors and the annual spring
break-up period in Canada. Taken together, these two effects
resulted in a 32% decrease in production in Q2 2015 vs. Q1 2015.
During most of the quarter, operations were curtailed at the Pueblo
seamless, Calgary, and Red Deer mills. During the last week of
June, production resumed in limited volumes at the Pueblo seamless
and Red Deer OCTG mills.
Prices for most steel products declined during the second
quarter towards levels in-line with the general market that reflect
prevailing scrap and plate prices across the product mix.
Average selling prices
USD/tonne (ex works) Q2 2015 Q1 2015 H1 2015 H1 2014
----------------------- -------- -------- -------- --------
Construction products 612 702 661 801
Flat-rolled products 718 904 806 948
Tubular products 1,089 1,280 1,185 1,312
----------------------- -------- -------- -------- --------
UKRAINE
Product, '000 tonnes Q2 2015 Q1 2015 Q2 2015/ Q1 2015, H1 2015 H1 2014 H1 2015/ H1 2014,
change change
------------------------ -------- -------- ------------------------ -------- -------- ------------------------
Coke (saleable) 190 208 -8.9% 398 331 20.3%
Pig iron 258 236 9.3% 494 497 -0.7%
Pig iron (saleable) 23 22 4.8% 45 14 233.5%
Crude steel 254 233 9.3% 487 500 -2.6%
Steel products 225 196 14.6% 421 433 -2.7%
Semi-finished
products 133 104 28.2% 237 224 6.0%
Finished products 92 92 -0.8% 184 209 -12.0%
Construction
products 79 79 0.4% 158 171 -7.6%
Other steel
products 13 14 -7.4% 26 38 -31.8%
------------------------ -------- -------- ------------------------ -------- -------- ------------------------
In Q2 2015, due to better quality of iron ore products used in
EVRAZ DMZ steel mill's pig iron production, output of pig iron and
crude steel increased by 9% and of steel products by 15% compared
to Q1 2015.
Production of semi-finished products for export surged by 28%
QoQ driven by weaker demand for finished products.
In Q3 2015, volume of crude steel and steel products is expected
to decrease as a result of scheduled maintenance works at a blast
furnace (5 days) and rolling capacities in July.
Prices of steel products, primarily semi-finished products for
export, were down in line with global benchmarks.
Average selling prices
USD/tonne (ex works) Q2 2015 Q1 2015 H1 2015 H1 2014
-------------------------- -------- -------- -------- --------
Coke (saleable) 175 191 183 168
Pig iron 248 270 259 332
Steel products
Semi-finished products 325 350 337 450
Construction products 436 440 459 577
Other steel products 704 528 618 858
-------------------------- -------- -------- -------- --------
SOUTH AFRICA
Following introduction of business rescue proceedings at EVRAZ
Highveld and Vanadium and it being managed by independent rescue
practitioners since 14 April 2015, as of Q2 2015 its results are no
longer consolidated .
IRON ORE
Product, '000 tonnes Q2 2015 Q1 2015 Q2 2015/ Q1 2015, change H1 2015 H1 2014 H1 2015/ H1 2014, change
---------------------- -------- -------- ------------------------- -------- -------- -------------------------
Sinter (Russia) 2,595 2,837 -8.5% 5,432 5,717 -5.0%
Pellets (Russia) 1,629 1,631 -0.1% 3,259 3,147 3.6%
Lumpy ore (Ukraine) 726 667 8.8% 1,393 1,450 -3.9%
---------------------- -------- -------- ------------------------- -------- -------- -------------------------
In Q2 2015, production of iron ore products (sinter plus
pellets) in Russia fell by 5% QoQ mostly due to decrease of
production of sinter (-9%) by EVRAZ ZSMK's sintering plant as a
result of scheduled maintenance works at EVRAZ ZSMK's sintering
machine.
In Ukraine, production of lumpy ore went up by 9% QoQ due to a
renewed order for Fe 56% content iron ore from a large Ukrainian
steel producer located close to Donetsk region and increased export
shipments to MENA.
In Q2 2015, prices for iron ore products decreased in line with
global benchmarks.
Average selling prices
USD/tonne (ex works) Q2 2015 Q1 2015 H1 2015 H1 2014
---------------------- -------- -------- -------- --------
Pellets (Russia) 41 47 44 83
Lumpy ore (Ukraine) 21 32 25 61
---------------------- -------- -------- -------- --------
COAL
Product, '000 tonnes Q2 2015 Q1 2015 Q2 2015/ Q1 2015, H1 2015 H1 2014 H1 2015/ H1 2014,
change change
------------------------ -------- -------- ------------------------ -------- -------- ------------------------
Raw coking coal (mined) 3,840 5,467 -29.8% 9,307 9,760 -4.6%
Yuzhkuzbassugol 1,510 2,626 -42.5% 4,137 5,334 -22.4%
Raspadskaya 2,270 2,802 -19.0% 5,072 4,427 14.6%
Mezhegeyugol 60 39 53.96% 98 0 n/a
Coking coal concentrate
(production) 3,119 3,382 -7.8% 6,501 6,669 -2.5%
Raw steam coal (mined) 41 0 n/a 41 757 -94.6%
------------------------ -------- -------- ------------------------ -------- -------- ------------------------
Coking coal
In Q2 2015, production of coking coal concentrate by EVRAZ
declined by 8% QoQ as both Yuzhkuzbassugol and Raspadskaya coal
companies mined less raw coal:
- The 43% decrease in mined raw coking coal volumes by
Yuzhkuzbassugol is attributed to scheduled longwall moves at its
Yerunakovskaya VIII, Osinnikovskaya and Yesaulskaya mines.
- Additionally, in response to deteriorating market conditions
and Russian rouble appreciation making unprofitable some of export
sales, the Raspadskaya coal company curtailed its mining volumes of
coking coal at its Raspadsky Razrez open pit and MUK-96 underground
mine. Two longwall moves began at the Raspadskaya underground mine
at the end of June. Taken together, these two factors resulted in a
19% reduction of raw coking coal production by the Raspadskaya coal
company.
In Q2 2015, the weighted average price of coking coal
concentrate in US dollar terms increased compared to Q1 2015 due to
the Russian rouble appreciation and higher share of premium coking
coal grades sold in the Russian market which to a large degree
offset the decreasing export prices.
Average selling prices
USD/tonne (ex works) Q2 2015 Q1 2015 H1 2015 H1 2014
-------- -------- -------- --------
unless otherwise stated
------------------------- -------- -------- -------- --------
Raw coking coal 39 31 36 49
Coking coal concentrate 68 56 61 77
------------------------- -------- -------- -------- --------
VANADIUM
Product, tonnes of V* Q2 2015 Q1 2015 Q2 2015/ Q1 2015, H1 2015 H1 2014 H1 2015/ H1 2014,
change change
------------------------ -------- -------- ------------------------ -------- -------- ------------------------
Vanadium in slag (gross
production) 3,834 5,917 -35.2% 9,751 10,404 -6.3%
Vanadium in final
products (saleable) 3,276 5,199 -37.0% 8,475 9,610 -11.8%
------------------------ -------- -------- ------------------------ -------- -------- ------------------------
(*) Calculated in pure vanadium equivalent
In Q2 2015, consolidated Vanadium slag production was 35% down
compared to Q1 2015 as EVRAZ Highveld's slag volumes are no longer
presented in the report following deconsolidation of EVRAZ
Highveld's results since April 2015 due to business rescue
proceedings. Excluding EVRAZ Highveld, the decrease would be 7%, or
3,834 tonnes of V produced in Russia compared to 4,129 tonnes in Q1
2015, due to lower pig iron production at EVRAZ NTMK.
Production of final vanadium products decreased by 37% QoQ,
mostly following deconsolidation of Hochvanadium, a EVRAZ
Highveld's subsidiary, as well as due to lower production of
oxides, vanadium aluminum and chemicals at EVRAZ Stratcor in the
USA driven by a one-month shutdown of the plant in April due to
lack of feedstock.
Average Q2 2015 quotations for ferrovanadium decreased QoQ with
Metal Bulletin FeV80 price index lowering by 2.9%, while North
American Ryan's Notes FeV80 index declined by 13.7%. EVRAZ's
average selling price mirrored descending price levels.
Average FeV indices
USD/tonne of V Q2 2015 Q1 2015 H1 2015 H1 2014
------------------------------------------------------------------------------ -------- -------- -------- --------
Metal Bulletin Ferro-vanadium basis 78% min, free DDP, consumer plant, 1st
grade Western Europe 21,206 21,850 21,528 26,101
Ryan's Notes N.A. FeV 80% min, US ex-warehouse, duty paid 21,522 24,948 23,235 29,321
------------------------------------------------------------------------------ -------- -------- -------- --------
Notes:
Semi-finished products include slabs, billets, pipe blanks and
other semi-finished products.
Construction products include beams, channels, angles, rebars,
wire rods, wire, and other construction products.
Railway products include rails, wheels, tyres and other railway
products.
Flat-rolled products include commodity plate, specialty plate
and other flat products.
Tubular products include large diameter line pipes, ERW pipes
and casings, seamless pipes and other tubular products.
Other steel products include rounds, grinding balls, mine
uprights, strips etc. For Ukraine they also include railway
products, for South Africa - rails.
###
For further information:
Media Relations:
London: +44 207 832 8998 Moscow: +7 495 937 6871
media@evraz.com
Investor Relations:
London: +44 207 832 8990 Moscow: +7 495 232 1370
ir@evraz.com
EVRAZ is a vertically integrated steel, mining and vanadium
business with operations in the Russian Federation, Ukraine,
Kazakhstan, USA, Canada, Czech Republic, Italy and South Africa.
EVRAZ is among the top steel producers in the world based on crude
steel production of 15.5 million tonnes in 2014. A significant
portion of the company's internal consumption of iron ore and
coking coal is covered by its mining operations. The company's
consolidated revenues for the year ended 31 December 2014 were
US$13,061 million, and consolidated EBITDA amounted to US$2,325
million.
This information is provided by RNS
The company news service from the London Stock Exchange
END
MSCUBVVRVAABARR
Evraz (LSE:EVR)
Historical Stock Chart
From Jul 2024 to Aug 2024
Evraz (LSE:EVR)
Historical Stock Chart
From Aug 2023 to Aug 2024