The Russian steel producer Novolipetsk Steel (NLMK) has stated that for Q3 2010 it expects to record a slight decrease in its sales revenues as well as an easing of its EBITDA margin to 30 percent (down from 36 percent in Q2), due to the decline in prices throughout the quarter with the average decrease for steel product prices ranging between 10‐15 percent quarter on quarter.
In addition, NLMK expects its Q3 operating performance to remain in line with the previous quarter, with sales estimated to reach around three million mt.
"Changes in financial performance will reflect the impact of external market factors related to a decrease in steel product prices throughout May‐August coupled with relatively stable raw material prices," NLMK's CFO Galina Aglyamova said.
With regard to the global steel market, NLMK said that in the short‐ and mid‐term it expects prices to fluctuate, and that the upward price trend emerging at the end of Q3 will be restrained by the still significant excess capacity and relatively low utilization rates in the global steel sector, which averaged in August at 73 percent.