Mechel receives 13 bln ruble tax debt deferral as state support

MOSCOW. June 30 (Interfax) - Mechel has obtained a three-year deferral for tax and insurance contribution payments totaling over 13 billion rubles as targeted state support, the maximum possible period under the arrangement, the company's deputy CEO for finance, Nelli Galeyeva, told journalists.

"We were among the first to apply for government support and the first to be reviewed by the commission chaired by Russian Finance Minister Anton Germanovich Siluanov. As part of financial measures to stabilize Mechel Group's economic position, we requested deferral of tax, levy and insurance contribution payments. We received a three-year payment deferral for over 13 billion rubles in taxes, levies and insurance contributions - the maximum term allowed under section 9 of the Russian Tax Code," she said.

"The freed-up cash flow will be directed to support our operational activities," Galeyeva said.

Industry-wide support measures like deferred mineral extraction tax (MET) and insurance payments would provide Mechel with approximately 0.5 billion rubles monthly liquidity relief, she said.

"We're all awaiting implementation of support measures for coal companies, particularly the universal deferral of MET and insurance premium payments. For Mechel, this will provide about 500 million rubles monthly combined relief for Yakutugol and Yuzhny Kuzbass . These are insurance contributions and MET that we won't have to pay during this period, making a single payment in December instead," she said.

"We expect the first results from these coal industry support measures starting June 30, giving us additional payment deferrals until December," she said.

As reported, Russia's government approved several support measures for the coal industry in late May. These include MET and insurance payment deferrals until December 1, 2025, 12.8% compensation for coal export transportation tariffs in northwestern and southern directions and targeted subsidies covering part of long-distance coal export logistics costs.

Companies facing significant debt burdens will be eligible for debt restructuring.

In addition, customized support measures were approved for specific companies including Mechel Mining, Vorkutaugol, and SDS-Ugol.