Severstal · RUS:CHMF
Severstal — Q3 2012 Earnings Presentation
24 slides from Severstal's earnings presentation, Nov 15, 2012
Slide 1: Q3 and 9M 2012 Financial Results Presentation
Q3 and 9M 2012 Financial Results Presentation 15 November 2012
Slide 2: Table of Contents
3 Q3 2012 Results Overview 7 Divisional Performance and Market Outlook Table of Contents 11 Financial Position 17 Appendices
Slide 3: Q3 2012 Results Overview
il i =| q i ” I a 9) Q3 2012 Severstal Results Overview
Slide 4: Summary
Summary Q3 2012 highlights Q3 revenue slightly down 3.4% q/q to $3,591m on lower realized prices at International and Resources divisions; Consolidated EBITDA* dropped 17.8% q/q to $546m (Q2 2012: $664m) due to softer performances from International and Resources divisions. As a result, EBITDA m
Slide 5: Revenue Dynamics and Breakdown
Revenue Dynamics and Breakdown Q3 2012 Revenue: $3,591m 9M 2012 Revenue: $10,988m (Q2 2012: $3,718m; -3.4%) (9M 2011*: $12,085m; -9.1%) Q3 revenue slightly decreased as a result of 9M revenue down y/y, due to decreased realized weaker q/q performance of International and prices at Severstal Russian
Slide 6: EBITDA Dynamics and Breakdown
EBITDA Dynamics and Breakdown Q3 2012 EBITDA: $546m 9M 2012 EBITDA: $1,772m (Q2 2012: $664m; -17.8%) (9M 2011*: $2,817m; -37.1%) Severstal Russian Steel’s EBITDA was broadly Severstal International demonstrated stable y/y flat q/q. Decrease at International and EBITDA, while Severstal Russian Steel
Slide 7: Divisional Performance and Market Outlook
Divisional Performance and Market Outlook
Slide 8: Severstal Russian Steel
Severstal Russian Steel EBITDA per tonne and average selling price Q3 revenue up 2.0% q/q to $2,254m (Q2 2012: $2,209m) on higher EBITDA per tonne (US$/t) Average Selling Price (US$/t)* realized steel volumes 400 Q3 EBITDA increased 5.6% to $284m (Q2 2012: $269m) with EBITDA 880 margin up to 12.
Slide 9: Severstal Resources
Severstal Resources EBITDA per tonne and average selling price Q3 revenue down 6.5% to $735m (Q2 2012: $786m) on lower EBITDA per tonne (US$/t) Average Selling Price (US$/t)* Vorkutaugol (RU) (coking realized prices, driven by global markets softening 160 220 202 coal concentrate) Q3 EBITDA of $
Slide 10: Severstal International
Severstal International SNA posted revenue of $910 million (Q2 2012: $1,063 million) EBITDA per tonne and average selling price The drop was due to lower realized prices coupled with weaker selling EBITDA per tonne (US$/t) Average Selling Price (US$/t*) volumes. Division's EBITDA declined to $17
Slide 11: Financial Position
Financial Position
Slide 12: Cash Flow and Net Working Capital
Cash Flow and Net Working Capital Highlights: 3 500 1,423 3 000 Liquidity position of $2,121m in cash and equivalents 2 500 (616) Operating cash flow of $1,423m more than covered 42 2,121 1,864 2 000 (592) 9m cash CAPEX of $979m 1 500 Lower q/q CAPEX in response to the deteriorating market con
Slide 13: Robust Liquidity and Sustainable Leverage
Robust Liquidity and Sustainable Leverage Strong liquidity position: 3 500 • Cash and cash equivalent of $2,121m 3 000 2 500 908 • Committed unused credit lines of $908m 2 000 Upcoming short-term debt maturities serviced 1 500 Total Short-term Debt to be Repaid of US$1,877m* with available liqui
Slide 14: Debt Structure
Debt Structure As of 30.09.2012 no significant changes in the current debt structure, 68% of which is represented by public debt and 84% is denominated in USD Debt Maturity Schedule, $m 1,507 1,522 663 1,016 536 461 73 2012 2013 2014 2015 2016 2017 2018+ Maturity This chart represents principal amou
Slide 15: Q4 2012 Market Outlook
Q4 2012 Market Outlook Global: Anticipate coking coal and iron ore prices to remain stable until the year end, while steel prices have some downside risk, therefore we expect Q4 2012 to be more challenging for us, as compared to Q3 2012 Global steelmaking utilization has reached 77.7% in Sep and
Slide 16: Thank you. Q&A
Wy Ui), Yip), yall iid LMM Y Thank you. Q&A
Slide 17: Appendices
Appendices
Slide 18: Summary Income Statement
Summary Income Statement $ million, unless otherwise stated Q3 2012 Q2 2012 9M 2012 Revenue 3,591 3,718 10,988 COGS (2,757) (2,737) (8,310) EBITDA* 546 664 1,772 EBITDA margin, % 15.2% 17.9% 16.1% Profit from operations 369 481 1,235 Operating margin, % 10.3% 12.9% 11.2% Profit before income tax 435
Slide 19: Q3 2012 Revenue Breakdown by Region
Q3 2012 Revenue Breakdown by Region Q3 2012/Q2 2012, $m 9M 2012/9M 2011, $m Q2 2012 Q3 2012 9M 2011* 9M 2012 15 98 Africa Africa 32 93 14 224 South-East Asia South-East Asia 30 116 186 445 China and Central Asia China and Central Asia 154 485 69 351 Middle East Middle East 103 248 111 239 Central an
Slide 20: Q3 2012 Division Results
Q3 2012 Division Results Severstal Russian Steel Q3 2012 Q2 2012 Change, % 9M 2012 9M 2011* Change, % Revenue ($m) 2,254 2,209 2.0% 6,688 8,206 (18.5%) Cost of sales ($m) (1,727) (1,680) 2.8% (5,199) (6,050) (14.1%) G&A and distribution ($m) (319) (323) (1.2%) (962) (964) (0.2%) G&A and distribution
Slide 21: Q3 2012 Division Results (Continued)
Q3 2012 Division Results (Continued) Severstal Resources Q3 2012 Q2 2012 Change, % 9M 2012 9M 2011* Change, % Revenue ($m) 735 786 (6.5%) 2,332 2,825 (17.5%) Cost of sales ($m) (420) (425) (1.2%) (1,257) (1,326) (5.2%) G&A and distribution ($m) (110) (114) (3.5%) (340) (343) (0.9%) G&A and distribut
Slide 22: Summary Balance Sheet
Summary Balance Sheet $ million As at 31 December 2011 As at 30 September 2012 Cash and Cash Equivalents 1,864 2,121 Total Assets: 17,910 15,829 Current Assets 8,930 6,125 Non-current Assets 8,980 9,704 Total Liabilities: 10,843 8,389 Current Liabilities 5,370 3,830 Non-current Liabilities 5,473 4,5
Slide 23: Summary Cash Flow Statement
Summary Cash Flow Statement $ million Q3 2012 Q2 2012 9M 2012 Profit before Financing and Taxation 370 456 1,183 Cash Generated from Operations 769 585 1,921 Interest Paid (129) (79) (346) Income Tax Paid (38) (39) (144) Net cash from operating activities – continuing operations 602 467 1,431 Net ca
Slide 24: Disclaimer
Disclaimer These materials are confidential and have been prepared by OAO 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