The Russian steelmaker Novolipetsk Steel (NLMK) has issued its operational results for the second quarter of 2009.
Accordingly, in the second quarter this year NLMK increased its crude steel production by 24 percent quarter on quarter to 2.6 million mt, and upped its finished steel products output by 18 percent to 2.5 million mt.
In Q2 2009, NLMK operated at approximately 92 percent capacity, with the utilization rate at its main production site in Lipetsk increasing to 98 percent, and the utilization rate at its steel producing subsidiary Maxi Group rising to 73 percent.
Despite the growth in its output, NLMK's total sales in Q2 decreased by three percent quarter on quarter to 2.3 million mt, including 800,000 mt of slabs - up 27 percent, 1.1 million mt of flat products - down seven percent, 60,000 mt of billets - down 21 percent, 200,000 mt of long products - down 25 percent, and 50,000 mt of metalware - up 36 percent, all compared to Q1 2009. "NLMK's sales were negatively impacted by low utilization rates and the weak economic environment of the first quarter and the beginning of the second quarter of the year," the company said in a statement.
Meanwhile, NLMK has stated that in Q2 this year it expects no major improvement its financial results compared to Q1. The company's Q2 EBITDA margin is expected to remain at a level of 15-20 percent.
As regards the future, NLMK expressed its belief that its operational and financial performance will improve in the third quarter of the current year. "This will be driven by stabilization and some improvement in the pricing environment of our key markets during the second and the third quarters coupled with high utilization rates at our production capacities," NLMK states.