Slide 1: IFRS financial statements for Q2 and H1 2019
IFRS financial statements for Q2 and H1 2019 1 August 2019 gelivostok.
Slide 2: Key highlights for MMK Group
2 Key highlights for MMK Group Q2 2019 results Revenue USD 1,999 mln up 8.9% on Q1 2019 Cost of sales USD 1,451 mln up 9.8% on Q1 2019 EBITDA USD 497 mln up 13.0% on Q1 2019 EBITDA margin 24.9% up 0.9 p.p. on Q1 2019 Net profit USD 272 mln up 20.9% on Q1 2019 Slab cash-cost USD 320 per tonne up 5.3%
Slide 3: Key operational indicators
3 Key operational indicators Key indicators, ths tonnes Q2 ’19 Q1’19 % H1’19 H1’18 % Pig iron production 2,452 2,396 2.3% 4,849 4,680 3.6% Crude steel production 3,091 3,107 -0.5% 6,198 6,176 0.4% MMK 3,091 3,107 -0.5% 6,198 6,176 0.4% Finished products, incl. 2,856 2,782 2.7% 5,638 5,675 -0.7% MMK
Slide 4: MMK Group's sales structure on key markets
4 MMK Group’s sales structure on key markets 600 593 587 HRC price , 584 581 575 Average sales prices of HRC in Q2 USD/t 577 581 2019 were higher q-o-q amid stable 550 562 511 541 global prices. 510 529 512 500 499 484 483 492 475 450 In Q2 2019, the Company increased Q1 2018 Q2 2018 Q3 2018 Q4 2018
Slide 5: MMK Group's sales structure on key markets
5 MMK Group’s sales structure on key markets 2 372 2 459 Russia and CIS Shipments to the domestic 14% 13% market sales by market increased in Q2 2019 sector, 21% 21% amid a seasonal growth in ths tonnes 7% 8% business activity. 6% 7% 26% 28% 26% 22% Q1 2019 Q2 2019 Flexibility in terms of export Ser
Slide 6: MMK Group's revenue by segment, USD mln
6 MMK Group's revenue by segment, USD mln The Group’s revenue in Q2 2019 Q1’18 Q2’18 Q3’18 Q4’18 Q1’19 Q2’19 amounted to USD 1,999 mln 1 903 2 049 2 024 1 850 1 783 1 866 which is up 8.9% compared to Q1 Steel Segment 2019. (Russia) Growth in sales volumes, improvement of the sales mix and price grow
Slide 7: MMK Group's key financial highlights
7 MMK Group’s key financial highlights 647 655 610 579 625 The average sale price in Q2 2019 578 600 186 increased by 8.1% q-o-q, due to an EBITDA/t vs metal 217 206 171 148 168 sale price, increase in sales, amid rising prices and 400 USD/t an improved sales mix in the domestic 200 461 438 404 408
Slide 8: Analysis of key financial highlights
8 Analysis of key financial highlights 2 500 The main factors that influenced 8 Analysis of 90 -1 33 8 27 revenue in Q2 2019 were growth in revenue, sales volumes amid rising prices, an 1 836 1 924 1 965 1 992 1 999 mln USD improvement in the sales mix and 0 the strengthening of the ruble. Coal Mini
Slide 9: Depreciation and capital investments
9 Depreciation and capital investments 150 MMK Group’s CAPEX in Q2 2019 Depreciation, 100 amounted to 246 million dollars, up mln USD 144 141 134 147 55.7% quarter on quarter, due to the 50 119 121 acceleration of the investment programme as part of the Company's 0 strategy. Q1 18 Q2 18 Q3 18 Q4 18
Slide 10: Net working capital & free cash flow (FCF)
10 Net working capital & free cash flow (FCF) 2 000 17 As of the end of Q2 16,8% 2019, the working 16 capital/revenue ratio 1 600 was 15.4% 1 382 1 235 16 1 133 1 231 1 197 1 149 15 1 200 15,4% 15,4% 14,7% 15 14,6% 800 14,3% 14 Net working capital, 14 400 mln USD 13 0 13 Q1 18 Q2 18 Q3 18 Q4 18 Q1 1
Slide 11: MMK Group's debt profile
11 MMK Group’s debt profile Debt Cash and deposits Debt and cash 1 000 880 1000 907 1 MMK Group’s debt at the end of Q2 0 710 81 funds structure 800 800 0 21 2019 amounted to USD 880 mln. 344 163 by currency, 600 510 600 29 mln USD 400 156 400 804 536 200 326 518 200 28 0 31.03.2019 30.06.2019 0 31.
Slide 12: Cost of sales and structure of material costs
12 Cost of sales and structure of material costs 1 321 1 451 MMK Group’s In Q2 2019, the share of raw cost of sales, 1,4% mln USD 0,1% 1,0% 8,6% 1,1% 0,3% 7,9% Change in work in progress materials for the production of pig iron 11,7% 11,0% Change in inventory in the structure of material costs rose
Slide 13: Dividends & comments on the market situation
13 Dividends & comments on the market situation Dividends On 31 July, the Company’s Board of Directors recommended that the Extraordinary meeting of shareholders (to be held on 27 September 2019) approve dividends for Q2 2019 of RUB 0.690 per share (before tax), equivalent to 200% of free cash flow
Slide 14: Disclaimer
14 Disclaimer • THESE MATERIALS ARE PROVIDED FOR INFORMATION PURPOSES ONLY • THIS PRESENTATION IS FOR DISTRIBUTION IN UK ONLY AMONG THE PEOPLE HAVING PROFESSIONAL SKILL IN THE ISSUES RELATED TO INVESTMENTS WITHIN THE MEANING OF ARTICLE 19(5) OF DIRECTIVE ON FINANCIAL ADVERTISEMENT APPROVED IN 2005 O