Severstal reports Q1 2021 financial and operational results

by David Fleschen

PAO Severstal (MOEX: CHMF; LSE: SVST), one of the world’s leading steel and steel-related mining companies, has announced its Q1 2021 operational and financial results for the period ended 31 March 2021.

These are the most important results compared to Q4 2020:

  • Crude steel production increased 7% q/q to 2.96 million tonnes (Q4 2020: 2.77 million tonnes), driven by a higher number of castings in Q1 2021 and an increase in the weight of each casting.
  • Hot metal output increased 12% q/q in Q1 2021 to 2.67 million tonnes (Q4 2020: 2.40 million tonnes) following the launch of BF#3.
  • Steel product sales increased 8% q/q to 2.63 million tonnes in Q1 2021 (Q4 2020: 2.44 million tonnes) following higher output volumes and the completion of short-term maintenance works in the previous quarter.
  • The Company increased its share of steel export shipments to 52% (Q4 2020: 35%) due to the more favourable export price dynamics and higher demand.
  • The share of high value-added (HVA) products within the sales portfolio amounted to 46% (Q4 2020: 53%) mainly reflecting increased volumes of hot-rolled coil, long products and semi-finished products.
  • Group revenue increased by 28.8% q/q to $2,219 million (Q4 2020: $1,723 million) reflecting higher steel sales volumes and favourable price dynamics.
  • Group EBITDA increased by 63.7% q/q to $1,162 million (Q4 2020: $710 million), driven by higher revenues. Severstal’s vertically integrated business model delivered an EBITDA margin of 52.4%, maintaining the Group’s position as the global leader by EBITDA margin in the steel industry.
  • Free Cash Flow increased by 134.4% q/q to $497 million in Q1 2021 (Q4 2020: $212 million), which primarily reflects positive changes in net working capital q/q and higher earnings.
  • Net profit totaled $721 million (Q4 2020: $386 million), including a FX loss of $47 million.
  • Cash CAPEX amounted to $278 million (Q4 2020: $311 million).
  • Net debt declined to $1,589 million at the end of Q1 2021 (Q4 2020: $2,029 million).
  • Severstal is committed to returning value to its shareholders whilst maintaining a comfortable level of debt. Severstal’s financial position remains strong with a Net debt/EBITDA ratio of 0.52 as at the end of Q1 2021. The Board of Directors has therefore recommended a dividend of 46.77 roubles per share for Q1 2021.

Source: Severstal, Photo: Fotolia

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