Q2 2021 vs. Q1 2021 ANALYSIS
·
Production: Hot metal output decreased by 2% qoq to 2.63 mln tonnes
due to scheduled BF repairs. Crude steel production decreased to
2.78 mln t (-6% qoq), as a result of lower hot metal output and
seasonal servicing works in BOF shop.
·
Steel sales were up by 2% qoq to 2.68 mln tonnes, mainly due to
strong sales of semi-finished and HVA products. The start of the
construction season in Russia supported the demand for CRC, colour
coated steel and metalware. Sales of hot-rolled steel and plate
decreased by 7% qoq to 1.1 mln tonnes due to significant scheduled
repair works. As a result, the share of the domestic market
increased to 55% (+7 ppts qoq).
·
Total share of high value-added (HVA) products amounted to 49% (+3
ppts qoq).
·
Raw materials sales: Sales of coal decreased by 18% qoq to 0.28 mln
t, driven mainly by a decline in steam coal sales as demand softened
during the summer season. Severstal continued to focus on
implementing its environmental strategy during the period, and in
June 2021 Vorkutaugol announced the termination of steam coal
production, starting from the first quarter of 2022 (press-release).
Sales of iron ore products increased by 28% to 1.3 mln tonnes,
driven by strong demand for pellets in Europe (sales grew by 34%
qoq), as crude steel production continued to recover in the EU27.
6M 2021 vs. 6M 2020 ANALYSIS
·
Production: Hot metal production increased by 12% yoy to 5.3 mln
tonnes, due to BF-3 commissioning in December 2020. Steel output
grew to 5.7 mln tonnes (+1% yoy), driven by the EAF-1 start up in
April 2021.
·
Steel sales were up by 4% yoy to 5.3 mln tonnes. Sales of
semi-finished products grew by 181% yoy to 0.58 mln tonnes following
higher output of crude steel, coupled with repairs to the hot-rolled
shop. Sales of hot-rolled steel and plates decreased by 17% yoy due
to a large-scale upgrade of one of the continuous slab heating
furnaces. The total share of domestic sales volume went down by 7
ppts yoy to 51% due to favourable export market conditions in Q1
2021.
·
High value-added (HVA) sales were up by 12% yoy to 2.5 mln tonnes,
mainly due to strong sales of cold-rolled (+32% yoy to 0.54 mln t)
and galvanized steel (+31% yoy to 0.53 mln t). The HVA share in
consolidated sales amounted to 48% (+4 ppts yoy).
·
Raw materials sales: Sales of coal decreased by 17% yoy to 0.63 mln
tonnes driven mainly by a decline in coal concentrate sales on the
back of lower output impacted by the long wall repositioning. Sales
of iron ore products decreased by 26% to 2.3 mln tonnes, driven by
the redirection of iron ore flow to owned assets following the
start-up of BF-3 in the end of 2020. Sales of iron ore pellets to
third parties reduced by 23% yoy to 2.3 mln tonnes. Iron ore
concentrate sales to third parties decrease substantially in Q2
2021, amounting to just 47 kt in 6m 2021 (-74% yoy).
SEGMENTS PERFORMANCE
Severstal Russian Steel (RSD)
$ million, unless otherwise stated |
Q2 2021 |
Q1 2021 |
qoq |
6m 2021 |
6m 2020 |
yoy |
Steel sales, kt |
2,691 |
2,642 |
2% |
5,333 |
5,147 |
4% |
Semis |
317 |
259 |
22% |
576 |
205 |
181% |
Commercial |
1,066 |
1,161 |
-8% |
2,227 |
2,692 |
-17% |
HVA |
1,308 |
1,222 |
7% |
2,530 |
2,250 |
12% |
Revenue |
2,759 |
2,154 |
28% |
4,913 |
3,286 |
49.50% |
EBITDA |
1,021 |
689 |
48% |
1,710 |
721 |
137.20% |
EBITDA margin, % |
37% |
32% |
5% |
34.80% |
21.90% |
12.90% |
Source from Severstal |