Russia-based steelmaking and mining giant Evraz said Tuesday that it is targeting substantial growth over the next few years. Evraz is targeting $5 billion EBITDA (earnings before interest, tax, depreciation and amortization) in 2016 and has planned growth in mining volumes to achieve 120 percent self-coverage in iron ore and 130 percent in coking coal by 2016. Evraz is also planning potential annual capital expenditure averaging US$1.5 billion from 2012 to 2016, in addition to increased investment focused on adding value to certain steel products, particularly in the rail and pipe segments.
North American demand for railways and pipelines is the driving factor behind Evraz's planned growth, and the company is bullish on the North American market, anticipating an approximately 4 percent a year growth rate through 2016. In particular, Evraz believes it will benefit from major oil and gas drilling areas such as Canada, North and South Dakota, and the Rockies. Evraz will also expand its rail business in the US, including improving quality, to compete with Japanese producers and gain market share from imports. "(Evraz sees) increasing profitability by shifting (the product) mix from standard to premium (head-hardened) rails," the company added.