Severstal EBITDA falls 38% in Q2, slightly better than consensus forecast, free cash flow negative again

MOSCOW. July 20 (Interfax) - Severstal saw EBITDA fall 38% year-on-year to 24.4 billion rubles in the second quarter of 2026, the steelmaker said in a statement.

Analysts surveyed by Interfax predicted the company's EBITDA at 24 billion rubles, which would have been a 39% decrease.

The EBITDA margin fell 7.7 percentage points to 14%.

Free cash flow was negative 29.8 billion rubles in Q2 compared with positive of 3.6 billion rubles in Q2 2025 and negative 40.4 billion rubles in Q1 2026. It was negative in Q2 2026 due to lower EBITDA, cash diverted to working capital and the ongoing investment program. Cash outflow to working capital totaled 22.4 billion rubles due to growth in accounts receivable and a drop in factoring volumes.

Cape fell 42% year-on-year to 25.3 billion rubles.

Steel production increased 12% YoY to 2.795 million tonnes, and sales rose 9% to 3.03 million tonnes. Capacity utilization approached 100%.

Revenue decreased 9% to 169.6 billion rubles - better than the consensus forecast of 162.4 billion rubles, which would have been a 12% decrease YoY.

Net profit fell to 4.1 billion rubles, from 15.7 billion rubles a year earlier. The consensus forecast was 6.8 billion rubles.

Total debt increased to 95.7 billion rubles, from 60.1 billion rubles at end-2025, with 35.6 billion rubles of the growth due to an increase in floating-rate bank loans.

Net debt was 88.4 billion rubles.

Severstal's consolidated financial results in Q2 2026, mln rubles:

Q2 2026 QoQ YoY H1 2026 YoY Revenue 169 564 17% -9% 314 875 -14% EBITDA 24 400 36% -38% 42 340 -46% EBITDA margin 14% +2 pp -7 pp 13% -9 pp Investments 25 284 -12% -42% 54 061 -38% FCF -29 824 - + 3 614 in Q2 2025 -70 195 -29 115 in H1 2025 Net profit 4 062 +71x -74% 4 119 36 746 Net debt/EBITDA 0,87x - 0,01x in Q2 2025 0,87x -

Severstal's operating performance, kt

Q2 2026 QoQ YoY H1 2026 YoY Production Hot metal 2 840 -2% 5% 5 371 2% Crude steel 2 795 3% 12% 5 518 3% Sales Steel products, including: 3 030 15% 9% 5 656 4% Semis 378 14% 60% 709 69% Commercial steel (hot-rolled and rolled products) 1 223 10% 7% 2 337 5% HVA products 1 429 21% 1% 2 610 -6% Iron ore 741 76% 24% 1 163 18%