Page 156 - RusRPTFeb23

UPS was up 0.7%. Mosenergo's gross electricity output in 2022 exceeded our forecast by 1.5%, and we now see slight upside to our 2022 financial forecasts. All in all, we see the 4Q22 operating results as strong. We have a BUY recommendation for the stock, which offers attractive upside of 40.6% and a dividend yield of 15.7% for 2023 (for the payments for the 2022 results).
9.2.11 Mines and Minerals - gold & diamonds 9.2.12 Mines and Minerals - steel & iron 9.2.13 Mines and Minerals - fertilisers
Acron’s gross fertiliser output increased by 2.4% to 7.9mn tonnes last year. Nitrogen fertiliser output was up 8.8% at 5.5mn tonnes, while complex fertiliser output fell 10% to 2.4mn tonnes. Despite all the logistical issues the company faced for most of the year (it was unable to ship its production through Baltic ports and had to shift to Russian routes), it still managed to increase its gross output by 2.4% last year. Moreover, its production was 12.9% above our forecast. We assume that the increase in production was driven by strong demand in the domestic market, the launch of new capacity and the quick resolution of logistics issues.
9.2.14 Mines and Minerals - other
Nornickel published 2022 production results on January 24. We see them as neutral on the whole. The output of all metals grew from the previous year's low base (which owed to accidents at mines and a processing plant). Nornickel's platinum and copper production last year were in line with the company's guidance.
However, its nickel and palladium output topped the high end of the company's forecasts by 2% and 3%, respectively. This was due to the fact that repairs at the Nadezhda Metallurgical Plant were pushed back to 2023. In general, the results were not surprising following the solid numbers for 9m22.
The shift in the timing for the repairs at the Nadezhda Metallurgical Plant was reflected in the company's guidance for 2023. Nornickel projects a 4% drop in nickel output and an even sharper 11% decline in palladium output next year. However, we expect the negative impact from the decline in production to be
156 RUSSIA Country Report February 2023 www.intellinews.com