Severstal announces financial results for the second quarter and first half of 2020

PJSC Severstal announced financial results for the second quarter and first half of 2020 for the period ended June 30, 2020.

Severstal CEO Alexander Shevelev “I am pleased to note that all of our companies have performed well despite the disruptions in the market caused by the COVID-19 outbreak. We have maintained almost 100% utilization rates at our steel plants. At our mines, we increased our coking coal sales by 34% QoQ, maintained strong iron ore sales volumes and achieved significant end-to-end optimization effects. The flexibility of our distribution network has allowed us to maintain a high export share, keeping sales volumes relatively stable over the period.

Average selling price declined by only 4% QoQ as we continue to develop our refining operations. Despite an 11% decrease in revenues in the second quarter of 2020, our high level of operational efficiency allowed us to maintain an EBITDA margin of 31.5%, which is the highest in the global steel industry in the world.

Free cash flow also rose from $ 54 million to $ 190 million in the quarter, although our capex level remained strong. Despite the COVID-19 pandemic, our transformation program continues and remains a very high priority for us. Severstal's financial position remains strong with a net debt /EBITDA ratio of 0.8 times, the Board of Directors remains confident in its forecasts and recommends a dividend of RUB 15.44 per share in Q2 2020. ” although our investment level remained high. Despite the COVID-19 pandemic, our transformation program continues and remains a very high priority for us. Severstal's financial position remains strong with a net debt /EBITDA ratio of 0.8 times, the Board of Directors remains confident in its forecasts and recommends a dividend of RUB 15.44 per share in Q2 2020. " although our investment level remained high. Despite the COVID-19 pandemic, our transformation program continues and remains a very high priority for us.

Severstal's financial position remains strong with a net debt /EBITDA ratio of 0.8 times, the Board of Directors remains confident in its forecasts and recommends a dividend of RUB 15.44 per share in Q2 2020. "

OUTLOOK - In the second quarter of 2020, global steel demand was impacted by the spread of COVID-19 as a result of blocking restrictions in the EU and Russia. According to industry experts, global steel demand in 2020 will decline by 6% y /y. Iron ore prices showed strong upward dynamics due to high tonnage