According to its financial results according to US GAAP (Generally Accepted Accounting Principles) for the second quarter and the first half of 2014, Russian steelmaker NLMK registered a net profit of $158 million in the second quarter, decreasing by nine percent quarter on quarter. NLMK's sales revenues in the given quarter amounted to $2.808 billion, up six percent quarter on quarter, due to the increase in the share of rolled products and the seasonal improvement in pricing conditions in the domestic market.
During the first six months, NLMK's net profit grew by 4.6 times to $332 million, compared to the same period of the previous year. This was due to the significant increase in profit from operations. The company's sales revenues fell four percent year on year to $5.446 billion in the given period. The reduction in revenue is associated with a drop in the prices for steel products that was partially offset by the increase in sales.
According to NLMK, its steel sales volume in the second quarter decreased by one percent quarter on quarter to 3.835 million mt, while in the first half the company's steel sales volume amounted to 7.702 million mt, up two percent year on year.
During the second quarter, NLMK produced 3.77 million mt of steel, down three percent quarter on quarter. This decline was mainly attributable to repair activities and the mastering of the pulverized coal injection (PCI) technologies at the Novolipetsk blast furnace operations.
Steel output in the first half increased by three percent year on year to 7.68 million mt, driven by the growth in steel production at NLMK Kaluga.
Regarding the third quarter, NLMK expects relatively stable demand for steel products in key markets. After the completion of repair works at blast furnace operations during the second quarter this year, the company expects its operating results to improve. Ongoing operational efficiency programs will maintain financial results at a strong level.