Severstal · RUS:CHMF
Severstal — Q1 2019 Earnings Presentation
19 slides from Severstal's earnings presentation, Apr 22, 2019
Slide 1: Q1 2019 Financial Results Presentation
Q1 2019 Financial Results Presentation 22.04.2019 1
Slide 2: Table of Contents
Table of Contents 03 Q1 2019 Results Overview 07 Divisional Performance 11 Financial Position 14 Market outlook 15 Appendices It isunauthorized Any strictly forbidden (or appendices annexes) to disclosure copying, is strictlyhereto) use, copy,ordisclose or of distribution distribute materials the ma
Slide 3: Q1 2019 Results Overview
Q1 2019 Results Overview Any unauthorized copying, disclosure or distribution of the materials 3 contained in this document (or its annexes) is strictly prohibited.
Slide 4: Q1 2019 Group Highlights
Q1 2019 Group Highlights 01 Group revenue marginally decreased 2.6% q/q to $2,031 million (Q4 2018: $2,085 million), as growth in steel sales volumes was offset by a decline in steel prices q/q. 02 Group EBITDA declined to $663 million (Q4 2018: $794 million), reflecting lower revenues as well as a
Slide 5: Revenue & EBITDA divisional quarterly dynamics
Revenue & EBITDA divisional quarterly dynamics Revenue (m$) Q3 18 - Q1 19: Q1 2019 Group Revenue: $2,031m down 2.6% (Q4 2018: $2,085m); 1,897 1,845 1,966 Group revenue decreased 2.6% as 468 563 511 growth in steel sales volumes was offset by a decline in steel prices q/q. (302) Q3 2018 (323) Q4 2018
Slide 6: +$350m EBITDA 2019 programme progress: key drivers from Q1 2018 to Q1 2019
+$350m EBITDA 2019 programme progress: key drivers* from Q1 2018 to Q1 2019 (149) 145 (5) (34) 706 Additional effect of $106m y/y 663 557 1. 2. 3. 4. EBITDA Q1 2018 Macro factors: selling prices EBITDA adjusted for macro Sales&Marketing Volumes Operational performance & EBITDA Q1 2019 and COS factor
Slide 7: Divisional Performance
Divisional Performance Any unauthorized copying, disclosure or distribution of the materials 7 contained in this document (or its annexes) is strictly prohibited.
Slide 8: Severstal Russian Steel (RSD)
Severstal Russian Steel (RSD) 01 RSD steel product sales increased 3% to 2.84 mln tonnes in Q1 2019 compared with the previous quarter (Q4 2018: 2.77 mln tonnes). The share of domestic sales rose to 65% due to the increased attractiveness of domestic sales (Q4 2018: 62%). 02 The share of high value-
Slide 9: Cherepovets Steel Mill production cash cost of slab, $/t
Cherepovets Steel Mill production cash cost of slab, $/t 361 350 335 342 327 334 331 323 321 322 325 Q1 19 non-integrated cash cost 302 of slab down $11/t q/q as a result of lower raw material and repair 255 259 expenses 250 214 221 206 203 213 318 177 272 280 Q1 19 integrated cash cost of 264 240 2
Slide 10: Severstal Resources: Vorkutaugol (coking coal concentrate)
Severstal Resources Resources cost of sales structure for Q1 2019, % 01 Coking coal concentrate sales volumes from Vorkutaugol declined 1% q/q due to 14% long-wall repositionings at the Vorgashorskaya, Zapolyarnaya and 31% Komsomolskaya mines, but remained at historically high levels due to high pro
Slide 11: Financial Position
Financial Position Any unauthorized copying, disclosure or distribution of the materials contained in this document (or its annexes) is strictly prohibited. 11
Slide 12: Cash Flow and Net Working Capital
Cash Flow and Net Working Capital Q1 2019 Highlights: Q1 19 EBITDA to FCF reconciliation, $m EBITDA Q1 01 Q1 19 free cash flow of $389m increased 67.0% as a result of 2019 663 positive changes in NWC q/q. cash CAPEX (209) interest paid & 02 Q1 19 cash CAPEX of $209m (Q4 18: $224m). other fin. cost (
Slide 13: Robust Liquidity and Sustainable Leverage
Robust Liquidity and Sustainable Leverage 01 At the end of Q1 2019, cash and cash equivalents stood at $583 million Robust Liquidity and Sustainable (Q4 2018: $228 million), reflecting FCF generation for the period. Leverage 02 Gross debt remained broadly unchanged during the period at $1,446 millio
Slide 14: Market Outlook
Market Outlook • In Q2 2019, we expect our financial results to be positively impacted by seasonal construction recovery in China and Russia, as well as the effect of higher iron ore prices in Q1. • Steel demand in Russia is expected to grow by 1% in 2019, supported by increased consumption in the a
Slide 15: Appendices
Appendices Any unauthorized copying, disclosure or distribution of the materials contained in this document (or its annexes) is strictly prohibited. 15
Slide 16: Q1 2019 Revenue Breakdown by Region
Q1 2019 Revenue Breakdown by Region Severstal Russian Steel Q1 2019 revenue breakdown by region 1% 1% 1% 6% Russian Federation Severstal Q1 2019 revenue breakdown Europe by region 24% CIS Americas 1% 1% The Middle East 2% 67% Africa 6% Russian Federation Europe 25% CIS Americas Severstal Resources Q
Slide 17: Q1 2019 Divisional Results
Q1 2019 Divisional Results Severstal Resources Q1 2019 Q4 2018 Change, % Q1 2019 Q1 2018 Change, % Revenue ($m) 511 563 (9.2%) 511 402 27.1% Cost of sales ($m) (222) (209) 6.2% (222) (198) 12.1% G&A expenses ($m) (15) (1) n/a (15) (17) (11.8%) Distribution expenses ($m) (8) (31) (74.2%) (8) (28) (71
Slide 18: Group financial summary
Group financial summary Summary Income Statement Summary Cash flow Statement $ million, unless Q1 2019 Q4 2018 Q1 2019 Q1 2018 $ million Q1 2019 Q4 2018 Q1 2019 Q1 2018 otherwise stated Revenue 2,031 2,085 2,031 2,173 Profit before Financing and Taxation 540 726 540 575 COGS (1,265) (1,179) (1,265)
Slide 19: Severstal. You can identify forward-looking statements by terms such as “expect”, “believe”, “estimate”, “intend”,
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