The Russian steelmaker Novolipetsk Steel (NLMK) has released its financial results for 2008 under US GAAP (Generally Accepted Accounting Principles).
Accordingly, during the period in question NLMK's revenue increased by 52 percent to $11.7 billion, its gross profit increased by 44 percent to $5.4 billion, its operating income rose by 35 percent to $4.06 billion, its EBITDA went up by 36 percent to $4.54 billion, and its net profit increased by one percent to $2.279 billion, all compared with 2007.
In 2008, NLMK also registered a 14 percent increase in its crude steel production to 10.5 million mt and an 11 percent rise in its steel product sales to 10.3 million mt.
For the year in question, NLMK's total investment in its technical upgrade program, including 2009 maintenance capital expenditure, was $1.934 billion, an increase of 102 percent year on year. However, due to the adverse global economic environment, NLMK has decided to reduce its 2009 investments in maintenance to $1 billion - down 48 percent year on year. NLMK will invest about $750 million in its Lipetsk production site for such projects as the construction of a new blast furnace No. 7 and the revamping of the converter shop No. 1.
Commenting on NLMK's results, the company's vice president for finance and CFO, Galina Aglyamova, said, "I am pleased to report a very successful performance in the full year 2008. During the first nine months of 2008 we took full advantage of growing prices and additional production volumes from organic growth and recent acquisitions."
"In 2009, we expect a significant year on year decrease in revenue due to lower sales volumes and price environment deterioration. We anticipate that production volumes will reach 10 million mt of steel. We will aim at maintaining high profitability driven by management performance improvement initiatives, and supported by lower raw materials prices and ruble devaluation," added Ms. Aglyamova in regard to the current year's expectations.