Frais de ce matin:
Grigory Fedorishin, Vice President for Finance and NLMK CFO, commented on the 2012 results:
"2012 proved to be challenging for the global steelmaking industry: the growth in prices we saw in the first half of the year gave way to a slump in consumption and prices on the back of weak macroeconomic conditions in the developed markets and the slowdown in the developing markets.
"Despite the weakening market conditions, NLMK Group managed to ensure a significant growth in sales, maintaining core asset utilization rates at almost 100% by relying on its efficient low-cost steel production and sustainable business model. Our sales grew 18% to 15.2 million tonnes, partially offsetting the slump in steel prices, driving the company revenue up 4% year-on-year to US$12.2 billion.
EBITDA was down by 16% to US$1.9 billion on the back of growing prices for the key raw materials. EBITDA margin was down to 16% (as compared to 19% in 2011), however, it still remained one of the highest in the sector. Net profit was down to US$596 million(-56%).
"As we finalized our large-scale capacity expansion projects, investments in 2012 decreased by 29% to US$1.5 billion. In 2013, we expect our capex to further reduce to US$1.0-1.2 billion, including maintenance investments. NLMK has a selective approach towards capex projects, prioritizing those with a high return on invested capital, aimed at minimizing costs and maximizing business efficiency. This year we are planning to announce NLMK's key strategic directions and investment programme priorities for the next five years, with a focus on improved efficiency, production resource saving, and further product quality enhancements.
"Ensuring high financial stability is among the company's short-term priorities. Ensuring a net debt to EBITDA ratio of 1.0 remains our long-term objective. In 2013, we are not planning on growing our absolute debt levels; borrowings will be used to further improve the structure of our credit portfolio in terms of debt maturities and currency. We are fully committed to maintaining the company's investment rating.
"In Q1 2013, steel output is expected to remain flat quarter-on-quarter. At the beginning of 2013, steel product prices are picking up, supported by consumer restocking and increasing iron ore prices. It should be noted that due to a delay in the recognition of export sales, the company's Q1 2013 financials will be impacted by end of 2012 prices and sales structure. Q1 2013 revenue could be down up to 5% quarter-on-quarter; Q1 EBITDA will be lower quarter-on-quarter as revenue declines while raw material prices still remain at elevated levels.
"In 2013, we expect our steel production output to reach 15.5 million tonnes, as utilization rates grow at our existing and pre-launch steelmaking capacities."
MANAGEMENT COMMENTS
· Market review
In the second half of 2012, the significant slowdown in the global economy negatively impacted steel demand, which translated into lower prices (a decrease of 10% in H2 2012 as compared to H1 2012) and triggered destocking by customers and trading/service centers. By the end of Q4 2012, steel stocks declined to minimal levels in 2012 leading to the stabilization of prices.
In early 2013 steel prices edged up on the back of an increase in raw material prices and some steel stock replenishment.
· Production and sales
2012 steel output grew by 25% y-o-y to 14.9 million tonnes driven by the launch of Blast Furnace #7 at the main production site in Lipetsk in the second half of 2011. NLMK's Russian operations produced 94% of the total output, or around 14 million tonnes. NLMK's share in the Russian steel output was 20%, making it the largest steelmaker in the country.
Sales jumped by 18% y-o-y to 15.2 million tonnes driven by the high run rates at the new steelmaking facilities at its Lipetsk plant. Intercompany sales of slabs grew to 2.6 million tonnes, an increase of 47% y-o-y.
Q4 steel output was 3.7 million tonnes (-3% q-o-q), which corresponds to 95% run rates at the steelmaking operations. This decline was due to the softening in demand in the international steel markets that coincided with the seasonal slowdown in buying activity in the Russian construction sector.
· Sales geography
NLMK's diversified sales geography helped to flexibly react to the worsening market conditions in the second of 2012 by shifting volumes to markets with a better demand, as well as by changing the product mix structure. Sales in Russia went up by 14% y-o-y to 4.9 million tonnes, with over 80% of the sales being delivered to the construction and infrastructure sector. International sales represent approximately 68% of the total sales, with the key regions remaining Europe (19%), S.E.Asia (16%) and N.America (14%).
In Q4 NLMK increased sales to the domestic market by 5% to 1.3 million tonnes, an all-time record. This growth was largely driven by a stable demand from the key customers, as well as the growth in the sales to pipe manufacturers.
· Sales structure
2012 finished steel sales went up by 22% to the all-time record level of 10.6 million tonnes, accounting for approximately 70% of total sales, up from 68% in 2011. Sales of value added steel products increased by 20% y-o-y, representing 36% of the total sales. Merchant slab sales were 3.96 million tonnes (+27% y-o-y).
In Russia, the company sold 4.9 million tonnes, of which 3.1 million tonnes were flat steel sales, whereas long steel and metalware sales accounted for 1.6 million tonnes. The share of value added sales in the domestic market represented 46%.
In Q4, due to seasonality factors coupled with the weaker market conditions in the international markets, finished steel sales decreased by 9% to 2.4 million tonnes. This decline was partially offset the increased sales of slabs that were more profitable at this time - third party sales went up by 26% y-o-y to 1.2 million tonnes.
In Russia, Q4 sales were 1.3 million tonnes, with flat steel sales growing 3% q-o-q to 0.8 million tonnes, while long steel and metalware sales were down to 0.4 million tonnes (-10% q-o-q). The domestic sales of value added steel represented 43%.
· Pricing environment
In the second half of 2012 steel prices in the international markets were significantly lower, declining on average by 10-15% as compared to the first half. In Russia, prices remained relatively stable supported by better demand from the construction sector, with weakening mild softening towards the end of the year. On a year-on-year basis, 2012 steel prices declined by 5-10%.
Q4 steel prices were 5-10% lower as compared to Q3 despite some stabilization in a number of regions. Domestic long steel and metalware prices declined in the range of 1% to 4% as demand from the construction market was seasonally weaker. Prices for value added flat steel products - CRC, galvanized and pre-painted steel - remained almost unchanged.
