Ferrexpo plc (LSE: FXPO), a producer and exporter of high
grade iron ore pellets to the global steel industry, with operations in
central Ukraine, hereby provides the following summary of its production
for the fourth quarter of 2022 (“4Q 2022”) and a trading update, in line
with previous year-end reporting:
The safety of Ferrexpo’s workforce continues to be the
Group’s first priority. The Group’s operations have completed a second
successive fatality-free year in 2022, and overall safety performance
remains in line with recent years. The war in Ukraine continues to
impact the Group’s workforce and communities across the country, and the
Group continues to support Ukraine at this difficult time.
Total iron ore pellet production for 4Q 2022 of 0.4
million tonnes (4Q 2021: 3.1 million tonnes). This reduction is
primarily due to the loss of electrical power for the majority of the
quarter, which was partially restored in late December, in addition to
existing constraints relating to Russia’s invasion. As of the date of
this release, the Group continues to produce iron ore pellets using one
pelletiser line (out of a total of four).
Operations continue to focus on the production of high
grade forms of iron ore, with 100% of output grading 65% Fe or above in
4Q 2022. Given recent operational disruptions, the Group elected to
reduce output of higher grade Direct Reduction (“DR”) Pellets (67% Fe)
during the period. DR pellets represented 6% of total pellet production
in 2022 (2021: 4%), and the Group expects to continue to increase its
focus on this particular product in the coming year.
Full year pellet production of 6.1 million tonnes in
2022, down 46% year on year, reflecting operational and logistical
constraints throughout 2022 due to the war in Ukraine (2021: 11.2
million tonnes produced).
Despite interruptions to the Group’s production during 4Q
2022, shipments to customers continued as planned at approximately the
same run rate as seen in the previous quarter of 2022.
Total full year sales of 6.2 million tonnes in 2022,
representing a 46% decrease year on year due to the ongoing war in
Ukraine, principally relating to the closure of Ukraine’s access to the
Black Sea, Russian attacks on Ukraine’s state-owned electricity network
and logistics constraints for users of Ukraine’s railway network, in
addition to other factors.
Full year production of commercial concentrate of 124
kilotonnes, representing 2% of total iron ore output in 2022 (2021: 2%),
providing an additional product in the Group’s marketing portfolio.
Resignation of Non-executive Director Kostyantin Zhevago
in December 2022.
Group net cash position, subject to minor final year-end
adjustments, of approximately US$105 million as of 31 December 2022 (31
December 2021: US$117 million), with minimal lease obligations and no
debt.
Jim North, Chief Executive Officer of Ferrexpo commented:
“The
past year has been an exceptionally difficult year for anyone connected
to Ukraine. After more than 320 days of conflict, however, Ukraine
continues to successfully defend itself. At Ferrexpo, our operating and
marketing teams have remained resilient throughout the war, and we
remain committed to supporting the people of Ukraine through our
continued operations and investments. Our full year pellet production of
6.1 million tonnes reflects both the determination of our workforce, and
the strong and supportive relationships that we have with our
stakeholders, such as our global customer network and local government.
We hope that the coming year will bring peace, and we look forward to
being a part of the process to deliver a new future for our people,
their families and communities across Ukraine.”
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Production Report and Trading Update for 4Q 2022 |