Evraz Group posts 82.1% rise in 1H2008 IFRS net profit

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29 Aug 2008

Evraz Group increased its net profit calculated to International Financial Reporting Standards by 82.1% year-on-year in the first half of 2008 to $2.04 billion, Russia's largest steelmaker said Friday. In the company's unaudited results, revenue reached $10.7 billion in the reporting period, a 78.2% rise over the first six months of 2007.

"Evraz delivered an exceptionally strong performance in the first half of 2008," said Alexander Frolov, Evraz Group's chairman and CEO. "In many ways, it was a result of the global steel environment characterized by continuously increasing demand, capacity constraints, shortage of raw materials for steel making and structurally limited supply in certain regions - all leading to growth of prices for steel products worldwide."
"In these market conditions, Evraz has benefited from being a vertically integrated business largely protected from increasing costs of raw materials," he added.
Consolidated adjusted earnings before interest, taxes, depreciation and amortization, or EBITDA, increased 80.5% to $3.7 billion, and operational profit went up 79.1% to $3.13 billion.
Crude steel production grew by 11.9% year-on-year to 9.5 million metric tons. Iron ore output rose 21.8% to 11.3 million tons with iron ore self-coverage of 93%.
Commenting on the outlook for the rest of 2008, Frolov said Evraz's consolidated revenues were expected to be in the range of $23.2-$24.6 billion, and EBITDA was expected to grow to approximately $8-$8.5 billion.
The company also expected to receive the necessary approvals in September to move ahead with its acquisition of Delong Holdings in China, as announced in the first half of the year.
The company has three steel-making subsidiaries in Siberia, and controls the Palini e Bertoli steel plant in Italy and Vitkovice Steel in Czech Republic.
The company also handles coal production and manages the Nakhodka sea port in the Russian Far East.
Apart from operations in Russia, Evraz Group also controls the U.S.-based Strategic Minerals Corporation and South Africa's Highveld Steel and Vanadium Corporation Limited as well as U.S.-based steel company Claymont Steel.
Last year Evraz Group posted revenue calculated to International Financial Reporting Standards of $12.8 billion, net profit of $2.44 billion, and EBITDA at $4.25 billion.

Source: Ria Novosti