Evraz Highveld Steel and Vanadium, South African subsidiary of Russia-based steelmaking and mining giant Evraz, has announced its financial results for the first quarter this year, posting a net loss of ZAR 105 million ($10 million), compared to a net profit of ZAR 30 million in the corresponding quarter of the previous year. The company's sales revenues amounted to ZAR 1.55 billion ($147.7 million), increasing by 9.9 percent year on year, with sales volumes growing by two percent to 138,207 mt, compared to the first quarter of the previous year.
The company's crude steel output in the first quarter decreased by 15 percent year on year to 149,623 mt, as a result of decreased iron ore availability and lower scrap ratios. Evraz Highveld's long product output increased by one percent to 50,230 mt during the first quarter, while flat steel output increased by 22 percent to 90,352 mt, both compared to the same quarter of 2013.
According to Evraz Highveld, the continued slow pace of large infrastructure project implementation in South Africa, a volatile labor market, notable energy tariff increases and electricity supply concerns, coupled with the declining levels of production and investment in the mining sector, will all continue to pose challenges to the domestic steel industry.