Support The Moscow Times!

Stronger Ruble Boosts Russian Severstal's Q2 Net Profit

An employee works at the Severstal steel plant.

Severstal, one of Russia's largest steel producers, saw its second-quarter net profit increase by 39 percent quarter-on-quarter because of a stronger ruble, it said on Thursday.

Severstal's net profit of $469 million was boosted by an FX translation profit of $130 million, the company, controlled by billionaire Alexei Mordashov, said in a statement.

Adjusting for this non-cash item, the company would have posted an underlying net profit of $339 million, missing an estimate by analysts of $358 million.

Its revenue increased 18 percent quarter-on-quarter to $1.8 billion, while earnings before interest, taxation, depreciation and amortization (EBITDA) rose 0.9 percent to $588 million.

The ruble strengthened by around 5 percent against the U.S. dollar in the second quarter and led to higher dollar-denominated selling prices. Revenue was also supported by a seasonal rebound in sales on domestic and export markets.

However, it said it expected global steel prices to remain under pressure because of a weaker Chinese economy, with steel demand falling 5.1 percent since the start of 2015 and growing Chinese steel products exports.

Read more

Independent journalism isn’t dead. You can help keep it alive.

The Moscow Times’ team of journalists has been first with the big stories on the coronavirus crisis in Russia since day one. Our exclusives and on-the-ground reporting are being read and shared by many high-profile journalists.

We wouldn’t be able to produce this crucial journalism without the support of our loyal readers. Please consider making a donation to The Moscow Times to help us continue covering this historic time in the world’s largest country.