Severstal posts IFRS EBITDA of $636 mln in Q3, above forecast
MOSCOW. Nov 5 (Interfax) - Russian steelmaker OJSC Severstal had earnings before taxes, depreciation, and amortization (EBITDA) to International Financial Reporting Standards (IFRS) of $636 million in the third quarter of 2014, the group said in a press release.
This was higher than the $597 million forecast analysts gave Interfax in a consensus forecast.
According to the press release, Q3 EBITDA was up by more than a fourth compared with the second quarter.
Severstal boosted EBITDA margin 5.3 percentage points to 28.4%, "representing the highest level since Q3 2008 and primarily reflecting a combination of ongoing operational enhancements at both Russian Steel and Resources division, a decline in raw materials input costs at our steel operations and further ruble depreciation," the press release says.
"The solid set of results was also supported by the disposal in September of our US business, which unlocked significant value for Severstal's shareholders and enhances the Group's overall profitability. The Board has also modified the Company's dividend policy to return 50% of net profit for a given reporting period to shareholders, reflecting Severstal's mission to maximize shareholder returns," the press release quotes Severstal CEO Alexey Mordashov as saying.
"Group revenue increased 2.4% quarter-on-quarter to $2.24 billion (Q2 2014: $2.187 billion) driven by further improvements at Russian Steel on the back of higher share of HVA products sales coupled with marginal price increase," the company said.
Analysts told Interfax they had expected revenue to be slightly higher at $2.27 billion.
"Net loss of $45 million (Q2 2014: net loss of $661 million), has been primarily affected by FX losses of continuing operations of $453 million and a gain on disposal of $85 million of the discontinued operation. Adjusting for those non-cash items, Severstal would have posted a net profit of $323 million (Q2 2014: net profit of $206 million), excluding FX gain in Q2 2014 of $199 million and impairment of $1.066 billion for continuing and discontinued operations," Severstal said.