Mmk · RUS:MAGN
Mmk — Q3 2019 Earnings Presentation
14 slides from Mmk's earnings presentation, Oct 31, 2019
Slide 1: IFRS financial statements for Q3 and 9M 2019
IFRS financial statements for Q3 and 9M 2019 31 October 2019 gelivostok.
Slide 2: Key highlights for MMK Group
1 Key highlights for MMK Group Q3 2019 results Revenue USD 2,009 mln up 0.5% on Q2 2019 Cost of sales USD 1,418 mln down 2.3% on Q2 2019 EBITDA USD 525 mln up 5.6% on Q2 2019 EBITDA margin 26.1% up 1.2 p.p. on Q2 2019 Net profit USD 271 mln down 0.4% on Q2 2019 Slab cash-cost USD 313 per tonne down
Slide 3: Key operational indicators
2 Key operational indicators Key indicators, ths tonnes Q3 ’19 Q2’19 % 9M’19 9M’18 % Pig iron production 2,560 2,452 4.4% 7,409 7,301 1.5% Crude steel production 3,194 3,091 3.3% 9,392 9,552 -1.7% MMK 3,194 3,091 3.3% 9,392 9,552 -1.7% Finished products, incl. 2,897 2,856 1.4% 8,535 8,728 -2.2% MMK
Slide 4: MMK Group’s sales structure on key markets
3 MMK Group’s sales structure on key markets 600 593 587 HRC price , 584 581 575 Average sales prices on the domestic USD/t 577 581 market for HRC in Q3 2019 were 550 562 541 535 slightly down q-o-q. 511 510 529 512 500 499 484 483 483 492 480 475 450 Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019
Slide 5: MMK Group’s sales structure on key markets
4 MMK Group’s sales structure on key markets 2 459 2 536 Russia and CIS In Q3 2019, domestic shipments market sales by 13% 16% grew due to seasonal growth in sector, 21% 21% business activity and the completed ths tonnes 8% 7% 7% 6% reconstruction of Mill 2500. 28% 26% 22% 24% Q2 2019 Q3 2019 Servic
Slide 6: MMK Group’s revenue by segment, mln USD
5 MMK Group’s revenue by segment, mln USD In Q3 2019, revenue of MMK Group amounted to USD 2,009 mln, up Q1’18 Q2’18 Q3’18 Q4’18 Q1’19 Q2’19 Q3’19 1 903 2 049 2 024 1 850 1 866 1 917 0.5% q-o-q. 1 783 Steel segment This growth was due to an increase (Russia) in sales volumes and a reorientation of s
Slide 7: MMK Group’s key financial highlights
6 MMK Group’s key financial highlights 647 655 610 625 616 The average selling price, expressed in 579 578 EBITDA/t vs metal 600 186 217 168 US dollars, for Q3 2019 decreased by 177 sale price, 206 171 148 1.5% q-o-q and amounted to USD 616 USD/t 400 per tonne. Meanwhile, EBITDA per tonne 200 461 43
Slide 8: Analysis of key financial highlights
7 Analysis of key financial highlights 2 500 -0,4 1 -1 -5 Key factors which affected revenue Analysis of -20 36 revenue, in Q3 2019 were an increase in sales mln USD 1 999 2 014 2 014 2 009 2 009 volumes amid negative pricing 0 trends in the global steel market. FX Revenue Coal Mining Price change f
Slide 9: Depreciation and capital investments
8 Depreciation and capital investments 150 In Q3 2019, CAPEX amounted to USD Depreciation, 188 mln. This 23.6% decline q-o-q is in mln USD 100 144 141 134 147 line with the investment programme 50 119 121 131 schedule. 0 Q1 18 Q2 18 Q3 18 Q4 18 Q1 19 Q2 19 Q3 19 300 Quarterly CAPEX, In 9M 2019, MMK
Slide 10: Net working capital & free cash flow (FCF)
9 Net working capital & free cash flow (FCF) As of the end of Q3 2 000 17,0% 2019, the working 16,8% capital/revenue ratio 16,5% was 14.5% 1 600 1 382 16,0% 1 235 1 149 1 231 1 197 1 133 1 165 15,5% 1 200 15,4% 15,4% 14,7% 15,0% 14,6% 14,5% 800 14,3% 14,5% Net working capital, 14,0% mln USD 400 13,5
Slide 11: MMK Group’s debt profile
10 MMK Group’s debt profile Debt Cash and deposits 880 1000 907 936 MMK Group’s debt as of the end of Q3 Debt and cash 1 000 866 1 81 funds structure 800 800 21 273 2019 amounted to USD 866 mln. 344 314 5 by currency, 600 600 mln USD 400 536 552 400 804 658 200 200 0 30.06.2019 30.09.2019 0 30.06.20
Slide 12: Cost of sales and structure of material costs
11 Cost of sales and structure of material costs 1 451 1 418 MMK Group’s In Q3 2019, the share of blast-furnace 1,4% 1,6% cost of sales, 0,3% 1,1% 1,6% 0,3% Change in work in mln USD 7,9% 8,8% progress raw materials in the structure of 11,0% 2,5% 11,6% 1,7% Change in inventory allowance material cos
Slide 13: Dividends & comments on the market situation
12 Dividends & comments on the market situation Dividends On 30 October 2019, the Board of Directors recommended that the Extraordinary General Meeting of Shareholders approve the payment of dividends for Q3 2019 of RUB 1.650 per share (100% of FCF for the period). The Board of Directors recommended
Slide 14: Disclaimer
13 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