Metalloinvest expects revenue, EBITDA to fall 20%-30% in 2012
MOSCOW. Feb 2 (Interfax) - Leading Russian iron producer Metalloinvest expects revenue and EBITDA to fall 20% to 30% in 2012, Metalloinvest Management Company CEO Eduard Potapov told the press.
Prices for iron ore slumped 30% in the fourth quarter, he said. "They have now gone up slightly and we think they will stay at that level throughout the year, which is 15%-20% lower than in 2011," Potapov said.
Revenue in 2011, according to preliminary figures, was around $10 billion.
Potapov estimates the company is worth $18 billion to $20 billion.
Metalloinvest has net debt of $5.6 billion. It plans to pay off $800 million in debt in 2012, a large part of which will be refinanced.
The company is not planning any major acquisitions this year. The investment program totals around 14 billion to 15 billion rubles, against 10.5 billion in 2011.
The company is also not planning any significant borrowing and will fund its investment program with its own cash flows.
Metalloinvest plans to develop its mining division and in 5-10 years it expects iron ore production to grow by 9 million to 10 million tonnes.
The company also plans to increase steel production by 10%-20% in the near future through organic growth.
A third HBI unit will be built this year with 3.2 million tonne capacity.
Metalloinvest is the largest iron ore producer in Russia and the CIS. It consists of Mikhailovsky GOK, Lebedinsky GOK, Oskol Electrometallurgical Plant and Ural Steel. Alisher Usmanov's Gallagher Holdings owns 50% of Metalloinvest, the father of Duma deputy Andrei Skoch, Vladimir Skoch, owns 30% and VTB owns 20% (acquired in December 2011 from Vasily Anisimov). A minority partner of Usmanov's in Gallagher is Farhad Moshiri with 10%.