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jewellery retail sales, according to the company. So far this year sales in January are ahead of every year over the last seven except for 2018 when the company netted a whopping $499mn of sales.
● Steel
Russia’s metals major Magnitogorsk Iron and Steel Works (MMK) will suspend operations at its steel sheet rolling shop No5 for a period of six to nine months after a fire broke out at the asset on February 8, the company said. The plant accounts for 50,000 tonnes of rolled stock monthly and the impact from the repair works on the annual Ebitda is estimated at 0.5%-1% ($10mn-20mn) by the company. As reported by bne IntelliNews, in 4Q19 MMK managed to contain its free cash flow decline on a weak market, beating consensus expectations on lower than expected capex and stronger than expected working capital release in 4Q19. MMK plans to partially compensate the loss due to the mill stoppage by increasing output by 100,000-150,000 tonnes at the CRC mill 2500.
Russian metals major NLMK reported a 10% quarter-on-quarter and 23% year-on-year drop in revenues to $2.3bn, due to a decline in steel product prices and compensated in part by an increase of the share of semi-finished products in sales. The company’s Ebitda was down 27% q/q to $480mn, with the margin down by 4pp to 21%. Net income was down by 36% q/q to $233mn. Despite the decline (in line with the weak steel market in 4Q19), NLMK’s top line and earnings beat the expectations of BCS Global Markets on lower than expected raw materials cost. In the previous quarter, NLMK joined other metals majors that showed weakness. In 4Q19, the company’s free cash flow (FCF) grew 36% q/q to $338mn, which came out 27% ahead of BCS GM's call of a higher than expected $334mn working capital release, mainly motivated by a decrease in receivables.
● Fertilisers
Russian fertiliser major PhosAgro reported 4Q19 IFRS results, under which the revenues declined by 11% year-on-year, due to the price drop of 32% y/y that was compensated by 16% rise in sales volumes. The company’s Ebitda was down by 40% y/y, while the adjusted net income dropped 77% y/y to RUB2.5bn. As reported by bne IntelliNews, in 2019 Phosagro approved its new dividend policy and unveiled growth and spending plans aiming to boost European sales by 25% by 2025 and go green. As of end of 2019 the
103 RUSSIA Country Report March 2020 www.intellinews.com
