Russian steelmaker Severstal has announced its financial results for the fourth quarter and the full year of 2017. Accordingly, in the fourth quarter Severstal registered a net profit of $563 million, rising by 89.6 percent compared to the third quarter. In the full year, the company recorded a net profit of $1.35 billion, decreasing by 16.4 percent year on year.
In the last quarter of 2017, Severstal's sales revenues increased by 10.4 percent quarter on quarter to $2.17 billion, as the decline in sales volumes was mitigated by the significant growth in steel and raw material average selling prices.
Severstal's sales revenues for 2017 amounted to $7.84 billion, up 32.7 percent compared to the previous year. In 2017, the company benefited from favorable steel and commodities pricing environment, which enabled it to achieve significant revenue growth year on year. At the same time, Severstal's EBITDA in the full year went up by 34.9 percent year on year to $2.57 billion, while its EBITDA margin for the year was 32.8 percent, up from 32.3 percent recorded in 2016.
According to the company’s statement, global export steel prices remained high on the back of Chinese production restrictions in the November-March heating season and decreased exports. Russian export prices followed global trends and are expected to increase in the first quarter of the current year. In 2017, steel consumption in Russia increased by five percent year on year on the back of growth in construction activity and auto production. Low inflation allows the Central Bank of Russia to decrease interest rates which is a positive driver for investment activity. Therefore, Severstal anticipates Russian steel demand to grow further by 3-4 percent in the current year with the solid pricing momentum to continue in the first quarter.