CONSENSUS: Analysts expect TMK net profit to IFRS to fall 60% in Q3
MOSCOW. Nov 28 (Interfax) - Analysts at investment companies and banks surveyed by Interfax anticipate that OJSC Pipe Metallurgical Company's (TMK) net profit to International Financial Reporting Standards (IFRS) for Q3 2011 will have fallen 60% from Q2 to $62 million.
The consensus forecast for consolidated Q3 sales revenue is $1.62 billion (down 14% year-on-year) and for EBITDA (earnings before interest, taxes, depreciation, and amortization) - $237 million (down 29%).
The company plans to release its consolidated IFRS report on Tuesday, November 29. This will be the first time that it publishes interim financial results for Q3.
Forecast TMK IFRS financial highlights for Q3 2011 ($mln, unless otherwise noted):
| Investment bank or company | Revenue | EBITDA | Net profit |
| ING | 1 634 | 247 | 71 |
| Morgan Stanley | 1 600 | 243 | 72 |
| Alfa Bank | 1 624 | 212 | 40 |
| BCS | 1 759 | 300 | 111 |
| VTB Capital | 1 438 | 220 | 50 |
| Renaissance Capital | 1 640 | 205 | 70 |
| Troika Dialog | 1 661 | 262 | 42 |
| Uralsib Capital | 1 630 | 209 | 36 |
| Consensus | 1 623 | 237 | 62 |
| Q2 2011 | 1 879 | 332 | 154 |
| Change, % | -14 | -29 | down 60% |
In Q3 TMK decreased product shipments 5.6% compared to Q2 to 1.03 million tonnes. Large diameter pipe shipments also fell, and in the Russian division oil country tubular goods shipments fell.
Analysts expect weak results from the company due to a decline in production.
A change in the range of products (the share of more profitable seamless tubing was reduced in favor of less profitable seamed tubing) must lead to a lowering of profitability for the Russian factories, analysts from Troika Dialog said. TMK's weak results will not come as a surprise for the market, since "last week the company's stock fell 7.7%, lagging behind on the MSCI Russia Index by 1.8%, possibly in anticipation of the publication of its results, they said.
TMK is a major Russian pipe producer, making product in Russia, the United States, Romania, and Kazakhstan. It shipped 3.969 million tonnes of pipe last year, 42% more than the year before. At the start of this year, 69.7% of the company stock was in the hands of Dmitry Pumpyansky (through TMK Steel).