Severstal · RUS:CHMF
Severstal — Q1 2015 Earnings Presentation
22 slides from Severstal's earnings presentation, Apr 23, 2015
Slide 1: Q1 2015 Financial Results Presentation
Q1 2015 Financial Results Presentation 23 April 2015
Slide 2: Table of Contents
3 Q1 2015 Results Overview 7 Divisional Performance and Market Outlook Table of Contents 11 Financial Position 16 Appendices
Slide 3: Q1 2015 Results Overview
os | Q1 2015 Severstal Results Overview Achieve more together
Slide 4: Summary
Summary Q1 2015 Highlights: Primarily reflecting a combination of ongoing efficiency improvements as well as lower input costs with RUB devaluation mitigating the impact of lower selling prices Severstal posted further EBITDA* margin expansion by 6.4 ppts q/q to 38.5% (Q4 14: 32.1%). This repres
Slide 5: Revenue Dynamics and Breakdown
Revenue Dynamics and Breakdown Q1 2015 Revenue: $1,531m Q1 2015 Revenue: $1,531m (Q4 2014: $1,878m; -18.5%) (Q1 2014: $1,991m*; -23.1%) Group revenue decreased q/q despite solid Primarily impacted by lower realized prices demand and the Company’s flexibility to shift its effect, which has been parti
Slide 6: EBITDA Dynamics and Breakdown
EBITDA Dynamics and Breakdown Q1 2015 EBITDA: $590m Q1 2015 EBITDA: $590m (Q4 2014: $602m; -2.0%) (Q1 2014: $459m**; +28.5%) While Group EBITDA decreased marginally q/q, EBITDA improvement y/y reflects a strong result EBITDA margin* expanded further driven by at Russian Steel on the back of operatio
Slide 7: Divisional Performance and Market Outlook
Divisional Performance and Market Outlook
Slide 8: Severstal Russian Steel (RSD)
Severstal Russian Steel (RSD) Severstal Russian Steel increased its steel output in Q1 2% to 2.96mnt with all its rolling facilities at Cherepovets Steel Mill (CherMK) running at almost full capacity. However, steel products sales EBITDA per tonne and average selling price decreased 4% q/q to 2.56
Slide 9: Cost Control at Severstal Russian Steel
Cost Control at Severstal Russian Steel Cherepovets Steel Mill production cash cost of slab, $/t $600 559 537 $500 484 472 457 457 432 418 409 $400 401 Cherepovets 370 377 361 350 cash cost of 327 slab at market $300 price of raw 255 Q1 15 non-integrated materials 214 cash cost of slab $200 389 378
Slide 10: Severstal Resources
Severstal Resources Severstal Resources has been able to partially mitigate the impact of a 15% q/q drop in Average selling price and cash cost per tonne the global iron ore benchmark and negative RUB devaluation effect. USD-denominated Cost per tonne (US$/t) Average Selling Price (US$/t)*** price
Slide 11: Financial Position
Financial Position
Slide 12: Cash Flow and Net Working Capital
Cash Flow and Net Working Capital Q1 2015 Highlights: Solid liquidity position of $1,522m in cash and cash equivalents Cash Flow dynamics, 31 Dec 2014 to 31 Mar 2015 Strong operating cash flow of $277m* 263 Q1 15 capex of $103m, 34.4% lower q/q (Q4 14: $157m) reflecting our prudent (68) approa
Slide 13: Robust Liquidity and Sustainable Leverage
Robust Liquidity and Sustainable Leverage Strong liquidity position: Severstal gross debt reduced by 15.5% since the end of Q4 14 to 688 $2,899m Total of $221m of bond issues redeemed during a public tender offer to buy back the Company’s 2016 and 2017 Eurobonds Total Short-term Debt to be Repai
Slide 14: Debt Structure
Debt Structure As at 31.03.2015 the debt structure was dominated by public debt (90% of total) and the US dollar (89.9% of total). Debt Maturity Schedule*, $m 84*** 137*** 703 627 575 521 452** 9 2 2015 2016 2017 2018 2019 2020+ Notes: Debt represents the principal amount of debt. Debt for 2015 repr
Slide 15: 2015 Market Outlook
2015 Market Outlook Global: Global steel markets remain under pressure due to steel overcapacity, weakening of the Chinese economy and softening of the steel-related commodity prices Near-term support for steel pricing can come from the seasonal pick-up in the construction- related demand global
Slide 16: Appendices
Severstal Appendices Achieve more together
Slide 17: Summary Income Statement
Summary Income Statement $ million, unless otherwise stated Q1 2015 Q4 2014 Q1 2015 Q1 2014* Revenue 1,531 1,878 1,531 1,991 COGS (812) (1,137) (812) (1,357) EBITDA 590 602 590 459 EBITDA margin, % 38.5% 32.1% 38.5% 23.1% Profit from operations 502 453 502 310 Operating margin, % 32.8% 24.1% 32.8% 1
Slide 18: Q1 2015 Revenue Breakdown by Region
Q1 2015 Revenue Breakdown by Region Severstal Group Q1 2015 revenue Severstal Russian Steel Q1 2015 revenue breakdown by region breakdown by region Asia 3% Asia Americas 3% 3% Other Americas Other 10% 4% 9% Middle East Middle East 4% 3% Europe Europe 19% Russia 18% Russia 61% 63% Severstal Resources
Slide 19: Q1 2015 Division Results
Q1 2015 Division Results Severstal Resources Q1 2015 Q4 2014* Change, % Q1 2015 Q1 2014* Change, % Revenue ($m) 289 356 (18.8%) 289 567 (49.0%) Cost of sales ($m) (155) (211) (26.5%) (155) (344) (54.9%) G&A expenses ($m) (15) (12) 25.0% (15) (30) (50.0%) Distribution expenses ($m) (30) (36) (16.7%)
Slide 20: Summary Balance Sheet
Summary Balance Sheet $ million As at 31 March 2015 As at 31 December 2014 Cash and Cash Equivalents 1,522 1,897 Total Assets: 7,076 7,561 Current Assets 3,297 3,620 Non-current Assets 3,779 3,941 Total Liabilities: 4,093 4,723 Current Liabilities 1,262 1,734 Non-current Liabilities 2,831 2,989 Tota
Slide 21: Summary Cash Flow Statement
Summary Cash Flow Statement $ million Q1 2015 Q4 2014 Q1 2015 Q1 2014* Profit before Financing and Taxation 488 290 488 289 Cash Generated from Operations 323 612 323 538 Interest Paid (42) (57) (42) (35) Income Tax Paid (4) (9) (4) (8) Net cash from Operating Activities - continuing operations 277
Slide 22: Disclaimer
Disclaimer These materials are confidential and have been prepared by PAO Severstal (Severstal) solely for your information and may not be reproduced, retransmitted or further distributed to any other person or published, in whole or in part, for any other purpose. These materials may contain projec