Ukraine's Metinvest sees revenue fall 33% to $3.55 bln in H1 2023

MOSCOW. March 1 (Interfax) - Metinvest earned $3.554 billion in revenue in the first half of 2023, 18% more than in the previous six months but 33% less year-on-year, Ukrainian media reported, citing the steel and mining group's presentation for the 15th JP Morgan Global Emerging Markets Corporate Conference.

The group's metallurgical business generated 68% of revenue and the mining division generated the remainder. Both business segments were profitable.

Adjusted EBITDA totaled $487 million in the first half. The EBITDA margin fell to 14% from 30% a year earlier.

The group's total and net debt decreased to $1.91 billion and $1.558 billion, respectively, by the end of the first half of 2023. Free cash flow tumbled 79% year-on-year to $173 million in the half. The cash balance stood at $352 million as of June 30, 2023.

Capital expenditures decreased by 39% year-on-year to $127 million in the first half, of which 80% went into the mining division. Capex on maintenance fell 32% while capex on strategic projects dropped 61%; maintenance accounted for 85% of capex and strategic investment made up 15%.

Metinvest said the European Union became the group's main market in the first half of 2023, accounting for 55% of metallurgical and mining product sales. The group sold 35% of its steel products and 28% of its iron ore on the Ukrainian market in the period.

Sales of metallurgical products fell 33% year-on-year in the half, as deliveries of in-house pig iron and flat products fell by 54% and 56%, respectively, amid no slab sales, and average selling prices fell.

This was partly offset by higher shipments of in-house billets, long products and coke, which rose by respectively 3%, 14% and 10% year-on-year, as well as greater resale volumes.

Mining sales fell 32%, primarily due to a 44% drop in iron ore product sales as exports, intragroup consumption and domestic demand decreased. Results were also affected by the drop in prices for 62% Fe iron ore fines. This was partly offset by higher sales volumes of pellets and coking coal concentrate, which rose by 43% and 42% year-on-year, respectively.

Metinvest has mining operations and metallurgical plants in Ukraine, Europe and the United States. Metinvest is 71.24% owned by SCM and 23.76% by Smart Holding, which jointly manage the group.