Page 72 - UKRRptSept20

July, Dmytro Khoroshun of Concorde Capital said in a note.
EBITDA at Ukraine’s largest steelmaker​ ​Metinvest​ jumped 28.6% m/m to $162mn in May​, according to its monthly results published on August 4. The holding’s revenue gained 13.6% m/m to $843mn. EBITDA excluding that of joint ventures (JVs) advanced 31.5% m/m to $146mn in May. Metinvest’s operating cash flow before working capital changes soared 69.0% m/m to $142mn in May, whereas cash flow from operations after working capital changes (but before profit tax and interest) jumped 69.2% m/m to $88mn in May.
Metinvest​ iron ore concentrate output rises 6% in 7M20. ​The attributable production of iron ore concentrate at the subsidiaries of Metinvest, Ukraine’s largest steel producer, amounted to 3.24mmt (104.5 kt per day) in July, according to Concorde Capital’s analysis of separate news reports by Interfax-Ukraine. This is a 6.4% m/m gain on a daily average basis. The holding’s pellet output was 591 kt in July, a 19.2% m/m rise on a daily average basis.
● Interpipe
Railway product sales volume at Ukraine’s largest producer​ ​Interpipe was 15.0 kt in July, a 41.7% m/m jump​, according to the company’s monthly operational report released on August 17. Pipe sales dropped 20.6% m/m to 38.9 kt, while external billet sales plunged 60.6% m/m to 2.1 kt. Total sales volume decreased 13.7% m/m to 56.0 kt. The m/m jump in railway product sales in July was driven by sales of wheels (+47.7% m/m to 12.8 kt). Deliveries of railway products to Russia and other Eurasian Economic Union (EAEU) countries recovered in July, as the share of CIS countries in its sales volumes rebounded to 45% in July from 13% in June, according to Interpipe’s report. The m/m loss in pipe sales volume in July was driven by the plunge for line pipes (-42% m/m to 18.9 kt), partially offset by a gain for OCTG pipes (2.1x m/m to 8.9 kt). During 7M20, Interpipe’s pipe sales dropped 24.0% y/y to 275.2 kt, driven mostly by a 52.6% plunge for OCTG pipes to 53.3 kt and a 30.1% drop for welded pipes to 46.8 kt. Railway product sales in 7M20 inched up 4.2% y/y to 119.5 kt, driven mostly by a 48.3% jump for wheelsets to 12.0 kt. Ukraine's share of pipe sales in 7M20 dropped 7pp from 2019 to 18%, and the share of sales in the Americas plunged 12pp to 12%. At the same time, Europe's share in pipe sales gained 7pp to 31%, and the share of MENA rose 9pp to 24%. The share of CIS countries in 7M20 climbed 2pp to 12%. The share of its railway product sales in Ukraine in 7M20 dropped 8pp from 2019 to 14%, while the share of sales to Europe gained 9pp to 35% and the share of sales to CIS countries slid 2pp to 43%. Regarding production volumes, which might be indicative of sales volumes in future months, Interpipe’s pipe production lost 13.7% m/m to 34.0 kt in July, while railway product output rose 16.0% m/m to 14.1 kt. Steel production slid 5.2% m/m in July to 57.0 kt. “It is positive that Interpipe’s sales volumes of railway products to the Russian/EAEU market rebounded in July after a plunge in June that was possibly related to the reintroduction of a 34.22% import dutyby the EAEU from June 2,” Dmytro Khoroshun of Concorde Capital said in a note. “Nevertheless, because of the recent drop in Ukraine’s export prices for railway products, we continue to see a significant risk of 50% or even larger plunge in Interpipe’s railway product segment EBITDA in 3Q20 (before reallocation from its steel segment) from its 1Q20 $70mn level.”
72​ UKRAINE Country Report​ September 2020 ​ ​www.intellinews.com