| | Jan to Sep'11 | Jan to Sep'10 | YoY |
| Revenue from external customers | 56,13,161 | 40,19,734 | 39.60% |
| Intersegment sales | 2,34,296 | 1,69,941 | 37.90% |
| Operating income | 2,77,921 | 1,90,495 | 45.90% |
| Net income | -38,217 | 59,193 | -164.60% |
| Adjusted EBITDA | 3,68,681 | 2,81,470 | 31.00% |
In’000 USD
| Q3'11 | Q3'10 | QoQ | |
| Revenue from external customers | 17,95,761 | 20,60,278 | -12.80% |
| Intersegment sales | 70,499 | 74,846 | -5.80% |
| Operating income | 1,15,550 | 36,779 | 214.20% |
| Net income | 18,037 | -71,435 | 125.20% |
| Adjusted EBITDA | 1,53,466 | 65,412 | 134.60% |
In’000 USD
| Product name | Jan to Sep'11 | Jan to Sep'10 | Change |
| Pig iron | 2,671.50 | 3,075.20 | -13% |
| Steel | 4,501.50 | 4,495.70 | 0% |
In’000 tonnes
| J to S'11 | J to S'10 | Change | |
| Flat products | 536.1 | 317 | 69% |
| Including those produced by third parties | 308.9 | 95.3 | 224% |
| Long products | 3,093.20 | 2,630.20 | 18% |
| Including those produced by third parties | 643 | 366.5 | 75% |
| Billets | 1,724.30 | 1,689.50 | 2% |
| Including those produced by third parties | 1,207.90 | 1,053.50 | 15% |
| Hardware and welded mesh | 735.5 | 617 | 19% |
| Including those produced by third parties | 56.4 | 21.7 | 160% |
| Forgings | 56 | 46.3 | 21% |
| Stampings | 89.3 | 70.1 | 27% |
In’000 tonnes
Mechel steel segment’s revenue from external customers in Q3 2011 amounted to USD 1.8 billion, or 55.9% of the consolidated net revenue, a decrease of 12.8% over the net segment’s revenue from external customers of USD 2.1 billion or 59.3% of consolidated net revenue in the Q2 2011.
In Q3 2011, the steel segment’s operating income increased by 214.2% and totaled USD 115.6 million, or 6.2% of total segment’s revenue, versus the operating income of USD 36.8 million or 1.7% of total segment’s revenue, in Q2 2011. The adjusted EBITDA in the steel segment in 3Q 2011 increased by 134.6% and amounted to USD 153.5 million, compared to the adjusted EBITDA of USD 65.4 million in Q2 2011. The adjusted EBITDA margin of the steel segment was 8.22% for the Q3 2011 versus the adjusted EBITDA margin of 3.06% in Q2 2011. Depreciation and amortization in steel segment rose by 2.8% from USD 32.4 million in Q2 2011 to USD 33.3 million in Q3 2011.
Mr Andrey Deineko CEO of Mechel-Steel Management Company noted that “The segment’s results in the third quarter noticeably outperformed those of the previous quarter. Despite a decline in revenue, which was attributable to a temporary reduction in sales to third parties, we demonstrated an increase in production volumes of the majority of our product types and stronger financial results. Improved production results were achieved due to re-starting Blast furnace №5 after its recent repair and replacement of Converter № 2 at the Chelyabinsk Metallurgical Plant, as well as modernization of rolling mills at Izhstal.
Implementation of investment programs at our steel plants and ongoing cost optimization on the back of lower prices of raw materials allowed us to reduce production costs for major product types. Given the favorable market environment, it resulted in substantial improvement of our financials. Mechel Service Global’s sales facilities allowed us to enhance the positive effect through reallocation of sales towards the regions with more favorable market conditions.”
