Page 129 - RusRPTJun19

farm amounts to about $304.8mn.
9.2.11 Metallurgy & mining corporate news
UC Rusal Aluminum exports from Russia rose 28% y/y in Jan-Apr. Export volumes continued to bounce back. Analysts expect 2Q19 financials and trading updates to be the main positive catalysts after weak 1Q19. News: Rusal’s aluminium exports from Russia rose by 28% y/y in Jan-Apr to 994kt – Interfax, citing Russian Railways data. Meanwhile, April export volumes declined by 2% to 259.2kt, while increasing by 238% y/y.
One of world's largest aluminium producers Rusal reported 8% quarter- on-quarter decline in IFRS revenues in the first quarter of 2019 to $2.2bn on lower sales and prices (down by 7% and 8% q/q, respectively). Weak results of Rusal were largely anticipated and are expected to rebound as the company continues to recover from lifting of the US sanctions. Rusal's Ebitda was down 38% q/q to $226mn, which was in line with consensus expectations of analysts. At the same time, anticipated share in profits of Norilsk Nickel metals major had Rusal's net income climb 83$ q/q to $273mn in 1Q19.
Russian steel pipemaker TMK is among the companies awarded a tender on the 474km expansion of the Bulgarian gas transportation system (GTS) by Bulgartransgaz, including the extension of the TurkStream (Turkish Stream) project, according to Interfax. Reportedly, the Gas Development and Expansion in Bulgaria (GDEB) consortium includes Bonatti, Max Streicher, and Completions Development Sarl, in which TMK is a minority shareholder. TMK plans to participate in the expansion of Bulgarian GTS as a pipe supplier. "We deem the news as positive for sentiment on TMK," VTB Capital commented on May 29, noting that 474km expansion of Bulgarian GTS might require around 350kt of LDPs (large diameter pipes). VTB estimates that should TMK supply at least one third of the pipeline, the contract might represent around 30% of the LDP produced by TMK in 2H19-1H20F and 3% of TMK’s revenues in 2H19- 1H20F.
Alrosa reported revenues of RUB61.4bn ($921mn) for the fourth quarter of 2019, down by 14% q/q. The company's Ebitda was down 33% q/q to RUB26.9bn, which was 2% below the consensus expectations of analysts. Earnings for 2018 overall stood at $397mn and missed expectations by 4%. Alrosa's net profit in the reporting quarter was 69% q/q down to $114mn. The decline was attributed to non-operational losses. While the Alrosa's earnings were below the expectations, the cash flow outperformed the consensus, delivering an upside to dividend expectations.
Russian uncut diamond monopoly Alrosa reported a dive of 14% month- on-month in rough diamonds sales to $316mn in April 2019, the company said. Nevertheless, the company maintains a moderately positive outlook and expects the market to improve in the second half of the year. "The decline in rough sales is a moderate negative surprise to us, as we expected diamond demand to stabilize after February-March recovery," BCS Global Markets commented on May 13. BCS GM sees the positive outlook from the company is a "minor and uncertain positive". Most recently Alrosa said it will dispose of up to RUB6bn of non-core assets, which could potentially improve cash flow and already high dividend payout. But BCS GM believes that although the
129 RUSSIA Country Report June 2019 www.intellinews.com