MMK-Metiz posts 47 mln rubles in net losses in Q1 compared to last year's profits
CHELYABINSK. May 16 (Interfax) - OJSC MMK-Metiz (based in the Chelyabinsk region, the metalware division of OJSC Magnitogorsk Iron & Steel Works ), posted 47.047 million rubles in net losses according to Russian accounting standards (RAS) compared to 59.087 million rubles in net profit for the same period of 2011, the company said in its materials.
The company's sales revenue decreased by 17.6% to 3.5 billion rubles.
The report did not specify the reasons for the change in the company's revenue and net profit but said that the first quarter of 2012 experienced a lack of growth in the metalware sector of Russia.
The report said: "The rate of recovery growth in the metalware sector for the first quarter of 2010-2012 has shown a declining tendency. This was especially true for the first quarter of 2012, the results of which indicate a lack of sector growth. The results were driven by the lack of funds at the start of the year on the part of end consumers, as well as overstocking of major metal trader's warehouses."
Total shipments of MMK-Metiz's production in the first quarter came to 108,900 tonnes.
The company's main financial results for Q1 (in thousands of rubles):
| Q1 2012 | Q1 2011 | |
| Sales revenue | 3 500 244 | 4 248 565 |
| Production costs | 3 243 378 | 3 891 941 |
| Gross profit | 256 866 | 356 624 |
| Profit (losses) from sales | (62 486) | 52 509 |
| Pretax profit (losses) | (58 075) | 72 581 |
| Net profit (losses) | (47 047) | 59 087 |
The company's accounts receivable in the first quarter increased from 733.011 million rubles to 803.865 million rubles while accounts payable went up from 2.0987 billion rubles to 2.256 billion rubles.
OJSC MMK-Metiz was founded in June 2006 following the merger of Magnitogorsk Metalware-Metallurgical and Gauge Plants, which specialize in the production of gauged roll, wire, steel cable, welding materials, fasteners, and wirecloth.
Magnitogorsk Iron & Steel Works owns 67% in MMK-Metiz, LLC TEK MMK - 16.57%, LLC Region - 13.88%, and LLC RFC-Capital - 4.25%.