Russian steelmaker Severstal has announced its financial results for the first quarter of the current year. Accordingly, in the given quarter Severstal registered a net profit of $359 million, rising by 33 percent compared to the corresponding quarter of the previous year.
In the first quarter of the current year, Severstal's sales revenues increased by 61.1 percent year on year to $1.76 billion. During the given quarter, the company benefitted from favorable steel and commodities pricing dynamics as well as from increased sales of steel products and iron ore pellets.
Severstal's EBITDA in the first three months this year increased by 111.7 percent year on year to $578 million, as a result of higher revenue generation, which was partially offset by higher operating costs, while its EBITDA margin for the period was 32.7 percent, up from 24.9 percent recorded in the first quarter of 2015.
According to Severstal’s statement, it expects further fundamental stabilization of the global steel and steel-related commodity markets to continue in the current year. As the global economy continues its growth, the company expects world steel demand to improve further this year. Steel demand will also be supported by China's shutdown of inefficient steel and mining capacities and its continued measures to stimulate domestic economic growth. After three years of decline, Russia's local steel consumption is expected to rise by approximately 1.5-2 percent in 2017 on the back of GDP growth.
The company also stated that it welcomes the European Commission’s preliminary decision not to impose provisional duties on imports of hot rolled flat steel products from Russia and other countries (Brazil, Iran, Serbia and Ukraine), which could make a positive contribution to its performance outlook.