Severstal expects higher output in Russia due to restocking and stronger demand

Wednesday, 08 September 2010 12:17:18 (GMT+2)

The Russian steel producer Severstal expects restocking and stronger market demand to drive output volumes at its Severstal Russian Steel division, with the oil and gas, automotive and construction sectors continuing to strengthen as the year progresses.

Accordingly, in Q2 2010 Severstal Russian Steel division, with its highly profitable domestic mills, remained the key strength of the company and delivered a strong performance with its revenue and EBITDA improving significantly quarter-on-quarter, even when adjusting for the unusually severe weather in Q1 2010.

In Q2 2010, Severstal Russian Steel's revenue increased by 45.1 percent quarter on quarter to $2.415 billion, with its average sales prices being 9.7 percent higher in Q2 over Q1. The division's EBITDA in Q2 2010 increased by 30.7 percent to $528 million compared to Q1.

Severstal Russian Steel showed strong results in H1 2010, despite the impact of severe weather conditions in Q1, supported by stronger local demand and a significant increase in export sales in Q2.

The performance for H1 2010 as a whole against H1 2009 showed significant improvements given a much more positive market environment and enhanced operating efficiency. Revenue increased by 63.4 percent to $4.079 billion, with EBITDA up 182.4 percent to $932 million, both compared to H1 2009.

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