Evraz said Tuesday that net profit reached $1.87 billion after the write-downs, which were a result of goodwill impairments, inventory revaluation and foreign exchange losses.
Analysts had expected a net profit of $3.37 billion, excluding write-downs.
"The numbers came below consensus due to a very weak fourth quarter, reporting earnings before interest, taxes, depreciation and amortization of $372 million for the last quarter of 2008 (an EBITDA margin of just 10 percent)," UralSib analyst Michael Kavanagh wrote in a note.
Company executives forecast more hard times ahead, though they did not provide financial details.
"Few can doubt that 2009 is going to prove a difficult year for the global steel industry and for Evraz as one of the sector's key players," chief executive Alexander Frolov said in a statement.
Evraz also said 2008 revenue rose 58.5 percent year on year to $20.38 billion and consolidated adjusted EBITDA rose 46.9 percent to $6.32 billion.
Evraz is one of several Russian steelmakers that borrowed heavily to fund expansion prior to the financial crisis, leaving it with $8 billion in net debt at the end of the first quarter.
Debt maturities in 2009 total about $3.0 billion, and senior vice president for finance, Pavel Tatyanin, said during a conference call that his company is in refinancing talks with creditors.
Tatyanin added that the group has $1 billion in VEB loans coming due in the fourth quarter and is reviewing options to refinance or extend this facility.
Evraz also expects that an extensive cost-cutting program will allow it to reduce U.S. dollar-denominated labor expenses by 40 percent year on year. It includes salary reductions and a shorter working week.
Frolov said Evraz could cut jobs in North America as it closes some smaller steel-rolling shops.
"We are talking about 100, 200 or 300 people," Frolov said.
Evraz employs about 5,000 people in North America.
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