METALLOINVEST ANNOUNCES 2017 IFRS FINANCIAL RESULTS

Moscow, Russia - 15 March 2018 - Metalloinvest ("the Company"), a leading global iron ore and HBI producer, and one of the regional producers of high-quality steel, today publishes its audited IFRS financial results for the full year ended 31 December 2017.

FINANCIAL HIGHLIGHTS

-          Revenue USD 6,231 mn (+46.2% y-o-y)

-          EBITDA USD 2,120 mn (+68.5%)

-          EBITDA Margin 34.0% vs. 29.5% in 2016

-          Net Income USD 1,406 mn (+21.9%)

-          Total Debt USD 4,446 mn (+6.3% compared to 31 December 2016)

-          Net Debt / EBITDA 1.9x vs.2.5x as of 31 December 2016

-          Capital Expenditure USD 489 mn (+68.6%)

PRODUCTION HIGHLIGHTS

-          Iron ore 40.3 mn tonnes (-1.0%)

-          Pellets 25.1 mn tonnes (-0.4%)

-          HBI/DRI 7.0 mn tonnes (+22.6%)

-          Hot metal 2.7 mn tonnes (-9.3%)

-          Crude steel 4.8 mn tonnes (+2.1%)

KEY CORPORATE HIGHLIGHTS

Operational developments and capital expenditure

-          Launched HBI-3 Plant at LGOK with a design capacity of 1.8 mn tonnes of hot briquetted iron (HBI) per year

-          Began operations at the concentrate intake facility at MGOK

-          Completed technical re-equipping of DRI unit #2 at OEMK

-          Completed hot tests for wheel and railway billets at Ural Steel

Key contracts signed

-          Long-term supply contracts for iron ore products with EVRAZ, Severstal and Mechel

-          Long-term supply contract for steel billets with OMK

-          Three-year collaboration memorandum for the supply of SBQ with KAMAZ

Financing

-          Issued 7-year USD 800 mn Eurobonds mainly to finance the tender offer of the Company's outstanding Eurobonds

-          Refinanced USD 1.03 bn pre-export credit facilities (PXF) with a new PXF raised in June 2017

-          Increased the ING BANK (EURASIA) revolving credit line limit to USD 200 mn and extended the loan duration by two years

-          Standard & Poor's revised the Company's long-term credit rating outlook to Stable from Negative, confirming its 'BB' rating

-          Received a long-term credit rating from Russian rating agency RAEX of 'ruAA-' with a Stable outlook

 

 

Andrey Varichev, CEO of Management Company Metalloinvest, commented:

"In 2017, we successfully launched HBI-3 Plant at Lebedinsky GOK with a capacity of 1.8 mn tonnes, a landmark event for the Company. The resulting increase in our capacity to produce high-quality products enables us to further strengthen our position as market leader with more than 50% of the total merchant HBI market and has significantly contributed to our strong financial performance year-on-year.

The growth in prices for our products over the past year has been supported by the proposed Chinese production cuts driven by the implementation of strict environmental pollution controls, and the recovery of steel demand in Russia, Europe and the USA. Persisting favourable market conditions and the Company's continued focus on increasing its production of high value-added products and the implementation of its operational improvement programme will enable Metalloinvest to keep delivering positive financial results."

Alexey Voronov, Finance Director of Management Company Metalloinvest, added:

"In 2017, we continued to proactively improve our debt portfolio. The most notable deals of the year were the issuance of a Eurobond to finance the tender of the Company's outstanding Eurobond and refinancing of our pre-export credit facilities. In the beginning of 2018, we raised a new PXF and executed a put-option on rouble-denominated bonds while keeping the issuance's full amount in the market. All of these proactive liability management exercises have enabled us to reduce our average debt servicing cost, extend the debt maturity and reduce 2018-2019 USD-denominated debt obligations to zero."

 

Full press release and financial statements are available at http://www.metalloinvest.com/en/investors/financial-results/

 

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For further information, please contact:

 

Artem Lavrishchev

Director of Investor Relations and Corporate Ratings

E: ir@metalloinvest.com

Т: +7 (495) 981-55-55

 

 

Metalloinvest is a leading global iron ore and merchant HBI producer and supplier, and one of the regional producers of high-quality steel. The Company has the world's second-largest measured iron ore reserve base and is one of the lowest-cost iron ore producers.

Metalloinvest is wholly owned by USM Holdings. Alisher Usmanov is the major beneficiary of USM Holdings (49%), with other major beneficiaries being the companies of Vladimir Skoch (30%) and Farhad Moshiri (10%).