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Mar.29.2024 1USD=7.095RMB
  SteelHome >>Steel>>Market Info>>Special Studies
 
NLMK Announced Q2 2020 Operation Report

https://en.steelhome.com [SteelHome] 2020-07-23 09:10:10

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Q2 2020 highlights

NLMK Group steel output* and sales were impacted by declining demand in its traditional sales markets due to the COVID-19 pandemic.

Steel output declined by 8% qoq (-3% yoy) to 3.9 m t, due to lower utilization rates at NLMK Russia Long Products and NLMK USA. Towards the end of the quarter capacity utilization in the long products segment began to recover, reaching 89% in June. Capacity utilization rates at NLMK’s European companies and NLMK USA remain low (66% and 50% in June, respectively).

Sales grew by 2% yoy to 4.4 m t due to higher slab and pig iron exports; Q2 2019 saw overhauls at NLMK Lipetsk BF and BOF operations. Quarter on quarter, sales declined by 3%.

Sales in export markets grew to 2 m t (+51% qoq; +71% yoy), due to deliveries being redistributed to the Asian market amid lower demand in other sales markets in April and May. Exports of semi-finished products and finished rolled products increased by 76% and 22% qoq, respectively (+137% yoy and +17% yoy).

NLMK Group sales to ‘home’ markets declined by 24% qoq (-23% yoy) to 2.31 m t.

6M 2020 highlights

Steel output went down by 1% yoy to 8.1 m t.

Sales totalled 8.9 m t (flat yoy).

Group export sales increased by 6% yoy to 3.4 m t, supported by higher exports of semis.

Sales to ‘home’ markets dropped by 6% yoy to 5.3 m t, due mainly to lower demand in the US market.

NLMK Group's Q2 2020 operating performance

Steel output declined by 8% qoq (-3% yoy) to 3.9 m t, due to lower steel output at the NLMK Russia Long Products and NLMK USA segments amid lower demand caused by the COVID-19 pandemic. Steel capacity utilization rates at NLMK Lipetsk (the Lipetsk site) were 100%.

Sales increased by 2% yoy to 4.4 m t, driven by higher steel output at the Lipetsk site; Q2 2019 saw overhauls at NLMK Lipetsk BF and BOF operations. The 3% qoq reduction was due to lower sales at NLMK USA and NLMK DanSteel (-39% and -26% qoq, respectively). NLMK sales to third parties were up by +13% qoq thanks to sales market and product portfolio diversification.

Sales mix: consolidated sales of semi-finished products increased by 10% qoq to 1.9 m t (+27% yoy), driven by higher exports of pig iron and billets. Slab sales climbed 1% qoq to 1.4 m t (+12% yoy). The share of exports to independent buyers in the sales mix increased, whereas the share of slab sales to NBH and sales to the Russian market decreased. Sales of semi-finished products to third parties increased by 43% qoq (+79% yoy) to 1.5 m t. Slab deliveries to NBH went down by 36% qoq to 0.47 m t (-33% yoy) against the backdrop of the segment’s lower demand (Appendix 2). Sales of finished products decreased by 12% qoq to 2.4 m t (-14% yoy) amid lower demand and an increase in the share of semi-finished products in the portfolio.

Sales to export markets grew by 51% qoq (+71% yoy) to 2 m t with an increased share ofsemisin the exportsales mix.

Sales to ‘home’ markets declined by 24% qoq (-23% yoy) to 2.3 m t as steel consumption in the Russian, US and EU markets declined. Sales in Russia declined by 18% qoq (-15% yoy) to 1.4 m t. In the US and the EU, sales declined by 39% and 26% qoq (-43% yoy and 24% yoy), respectively (Appendix 14).

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(To contact the reporter on this story: leo.ji@steelhome.cn or 86-555-2238932 18616060095)
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