OREANDA-NEWS. MMK's Steel Segment Trading Update for Q4 and FY 2015

Pig iron output in Q4 2015 decreased by 4.3% q-o-q to 2,541 thousand tonnes. This was due to the shutdown of the blast furnace #9 for maintenance in December 2015.

Crude steel output in Q4 2015 decreased by 7.8% q-o-q to 2,897 thousand tonnes. This was due to decreased arc-furnace capacity utilisation.

In Q4 2015, shipments of finished products totalled 2,597 thousand tonnes, down 10.3% q-o-q. The magnitude of this decline was somewhat higher compared to an average decline in the same period in the last 3 years (-7-8%). This was due to not only seasonal business slowdown on the domestic market, but also due to overall weakening of Russian economy.

To compensate for the seasonal decline in demand on the domestic market the company increased export sales in Q4 2015 by 12.9% q-o-q or 73 thousand tonnes. The share of export sales for Q4 2015 amounted to 24.6%.

In FY 2015, shipments of finished products totalled 11,012 thousand tonnes, down 5.5% q-o-q. ? In FY 2015, the share of export sales stood at 23.5%: up nearly 7.2 p.p. y-o-y. ? Despite a decline in demand from construction industry throughout 2015, capacity utilisation of long products facilities remained at a high level of around 94% for FY 2015.

Sales of long products in Q4 2015 decreased 22.7% q-o-q, due to a reduction in investment activity in the construction sector as well as seasonal low demand for construction products during the winter period and a high base effect from the previous quarter.