Severstal · RUS:CHMF
Severstal — FY2014 Earnings Presentation
22 slides from Severstal's earnings presentation, Feb 18, 2015
Slide 1: Q4 and FY 2014 Financial Results Presentation
Q4 and FY 2014 Financial Results Presentation 18 February 2015
Slide 2: Table of Contents
3 Q4 and FY 2014 Results Overview 7 Divisional Performance and Market Outlook Table of Contents 11 Financial Position 16 Appendices
Slide 3: Q4 and FY 2014 Results Overview
Q4 and FY 2014 Results Overview
Slide 4: Summary
Summary Q4 and FY14 Highlights: Coupled with a decent y/y increase in EBITDA* Severstal turned into one of the global leaders in terms of profitability with EBITDA margin of 26.6% (FY13: 19.3%**). Group profitability has been positively affected by Severstal decision to divest Severstal North Amer
Slide 5: Revenue Dynamics and Breakdown
Revenue Dynamics and Breakdown Q4 2014 Revenue: $1,878m FY 2014 Revenue: $8,296m (Q3 2014: $2,240m; -16.2%) (FY 2013: $9,434m*; -12.1%) Despite high share of HVA products at Despite substantial improvements in product Russian Steel as well as significant sales mixes, both Russian Steel and Resources
Slide 6: EBITDA Dynamics and Breakdown
EBITDA Dynamics and Breakdown Q4 2014 EBITDA: $602m FY 2014 EBITDA: $2,203m (Q3 2014: $636m; -5.3%) (FY 2013: $1,818m**; +21.2%) Group EBITDA margin* expanded q/q driven by EBITDA improvement y/y reflects robust results of efficiency improvements at Russian Steel Russian Steel on the back of operati
Slide 7: Divisional Performance and Market Outlook
Divisional Performance and Market Outlook
Slide 8: Severstal Russian Steel (RSD)
Severstal Russian Steel (RSD) Due to seasonal factors as well as marginal change to the product mix coupled with short-term EBITDA per tonne and average selling price maintenance at one of the mills RSD steel products sales decreased 3% q/q Share of high value-added products in the sales portfol
Slide 9: Cost Control at Severstal Russian Steel
Cost Control at Severstal Russian Steel Cherepovets Steel Mill production cash cost of slab, $/t 600 559 537 500 484 472 457 457 432 418 409 401 400 370 377 Cherepovets 350 361 327 cash cost of slab at market 300 255 price of raw Q4 14 non-integrated materials cash cost of slab 200 389 358 378 344 3
Slide 10: Severstal Resources
Severstal Resources Q4 revenue 18.6% lowered q/q to $358m (Q3 14: $ 440m) largely driven by decline Average selling price and cash cost per tonne in average selling prices for iron ore pellets and concentrate (decreased 25% q/q Cost per tonne (US$/t) Average Selling Price (US$/t)** and 27% q/q, re
Slide 11: Financial Position
Severstal Financial Position Achieve more together EF“ eee
Slide 12: Cash Flow and Net Working Capital
Cash Flow and Net Working Capital Q4 and FY14 Highlights: Solid liquidity position of $1,897m in cash and cash equivalents after SNA disposal Cash Flow dynamics, 31 Dec 2013 to 31 Dec 2014 and subsequent special dividend payout 1,202 Strong operating cash flow of $546m* in Q4 and $1,930m* in FY1
Slide 13: Robust Liquidity and Sustainable Leverage
Robust Liquidity and Sustainable Leverage Strong liquidity position: Severstal gross debt declined a further 2.8% q/q to $3,429m as at the end of Q4. 388 As at the end of Q4, cash and cash equivalents went down to $1,897m after special dividend payout Total Short-term Debt to be Repaid of $768m*
Slide 14: Debt Structure
Debt Structure As at 31.12.2014 the debt structure was dominated by public debt (82% of total) and the US dollar (90.9% of total). Debt Maturity Schedule*, $m 300** 712 704 669 575 451*** 17 2 2015 2016 2017 2018 2019 2020+ Notes: Debt represents the principal amount of debt. Debt for 2015 represent
Slide 15: 2015 Market Outlook
2015 Market Outlook Global: Global steel production increased by 1.2% in 2014. Average global steelmaking capacity utilization remains low at 76.3% High competition on the steel market between major exporters continues to weigh pressure on global steel prices Iron ore and coking coal markets r
Slide 16: Appendices
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Slide 17: Summary Income Statement
Summary Income Statement $ million, unless otherwise stated Q4 2014 Q3 2014 2014 2013* Revenue 1,878 2,240 8,296 9,434 COGS (1,137) (1,447) (5,448) (6,614) EBITDA 602 636 2,203 1,818 EBITDA margin, % 32.1% 28.4% 26.6% 19.3% Profit from operations 453 479 1,594 1,209 Operating margin, % 24.1% 21.4% 1
Slide 18: Q4 2014 Revenue Breakdown by Region
Q4 2014 Revenue Breakdown by Region Severstal Group Q4 2014 revenue Severstal Russian Steel Q4 2014 revenue breakdown by region breakdown by region Middle East 3% Other 7% Middle East Other 2% 7% Europe South America 19% 3% Europe 17% Russia Russia 71% 68% North America 3% Severstal Resources Q4 201
Slide 19: Q4 2014 Division Results
Q4 2014 Division Results Severstal Resources Q4 2014 Q3 2014 Change, % 2014 2013 Change, % Revenue ($m) 358 440 (18.6%) 1,851 2,665 (30.5%) Cost of sales ($m) (210) (301) (30.2%) (1,201) (1,652) (27.3%) G&A expences ($m) (9) (22) (59.1%) (89) (97) (8.2%) Distribution expences ($m) (36) (47) (23.4%)
Slide 20: Summary Balance Sheet
Summary Balance Sheet $ million As at 31 December 2014 As at 31 December 2013 Cash and Cash Equivalents 1,897 1,036 Total Assets: 7,561 14,534 Current Assets 3,620 4,906 Non-current Assets 3,941 9,628 Total Liabilities: 4,723 7,534 Current Liabilities 1,734 2,549 Non-current Liabilities 2,989 4,985
Slide 21: Summary Cash Flow Statement
Summary Cash Flow Statement $ million Q4 2014 Q3 2014 2014 2013* Profit before Financing and Taxation 290 437 1,201 897 Cash Generated from Operations 612 463 2,231 1,748 Interest Paid (57) (46) (247) (307) Income Tax Paid (9) (38) (54) (64) Net cash from Operating Activities - continuing operations
Slide 22: Disclaimer
Disclaimer These materials are confidential and have been prepared by PAO Severstal (Severstal) solely for your information and may not be reproduced, retransmitted or further distributed to any other person or published, in whole or in part, for any other purpose. These materials may contain projec