Novolipetsk Steel announces its Q3 2009 Russian Accounting Standards financial results for its major companies1.
| | Q3’09 | Q2’09 | Change | Q3’08 | Change |
| Revenue | 6,618,151 | 26,684,964 | 37.22% | 65,372,070 | -43.99% |
| Gross profit | 11,000,585 | 5,671,891 | 93.95% | 32,438,900 | -66.09% |
| Operating profit | 6,570,719 | 1,587,081 | 314.01% | 28,531,699 | -76.97% |
| Net profit | 5,551,138 | 22,322,948 | -75.13% | 30,680,820 | -81.91% |
(In thousand RUB)
VIZ Stal
Improvements in the transformer market allowed QoQ sales to double. Overall sales growth is also attributable to additional orders transferred from Novolipetsk transformer steel shop where production was suspended from April to September 2009. Higher sales volumes were a major contributor to the increase in QoQ revenue and gross profit.
The operating profit and net profit has grown by respective 91% and 240% QoQ driven, along with other factors, by SG&A costs reduction.
| Q3 2009 | Q3'08 | Q2'09 | Change | Q3’08 | Change |
| Revenue | 3,249,602 | 1,905,786 | 70.51% | 5,401,119 | -39.83% |
| Gross profit | 1,678,012 | 935,779 | 79.32% | 3,140,483 | -46.57% |
| Operating profit | 1,520,248 | 797,956 | 90.52% | 3,004,467 | -49.40% |
| Net profit | 822,709 | 241,062 | 241.29% | 2,488,889 | -66.94% |
(In thousand RUB)
Stoilensky
Lower QoQ sales volumes of iron ore concentrate and sinter ore were a major cause of the company’s revenue decline. Average quarterly sales volumes were exceed in Q2 2009 because of excessive stock sales from the previous periods. Net profit decline was driven by lower sales volumes as well as by lower interest receivable due to the reduction of short term investments paid as dividends to the parent company in Q2 2009.
| | Q3'09 | Q2'09 | Change | Q3'08 | Change |
| Revenue | 3,738,976 | 4,901,906 | -23.72% | 6,070,085 | -38.40% |
| Gross profit | 1,996,705 | 2,658,255 | -24.89% | 4,230,776 | -52.81% |
| Operating profit | 1,783,173 | 2,201,772 | -19.01% | 3,985,320 | -55.26% |
| Net profit | 1,435,208 | 1,837,050 | -21.87% | 3,239,316 | -55.69% |
(In thousand RUB)
NSMMZ
Higher QoQ sales and prices allowed NSMMZ to improve its sales revenue. A seasonal pickup in the constructional sector allowed the company to expand its share of high value added products and to increase the company’s gross profit by 112% QoQ. The plant’s operating profit improved significantly in Q3 2009 to RUB 206 million compared to a Q2 2009 loss of RUB 158 million.
Q3 2009 net loss was reduced by 16% QoQ. The loss was primarily attributable to the company’s debt position. The last 3 months have seen bank loans actively replaced by financing from the parent company. The NLMK Group plans to refinance short term loans by long term financing with lower interest rates.
| | Q3’09 | Q2’09 | Change | Q3’08 | Change |
| Revenue | 5,878,636 | 4,750,595 | 23.75% | 12,899,691 | -54.43% |
| Gross profit | 723,849 | 342,295 | 111.47% | 4,577,457 | -84.19% |
| Operating profit | 205,688 | -157,902 | N/A | 3,908,439 | N/A |
| Net profit | -973,805 | -1,157,031 | -15.84% | 2,671,918 | N/A |
(In thousand RUB)
Altay Koks
Increased steel production at Lipetsk made up 70% of Altay koks products sold. An increase in sales volume resulted in a QoQ revenue increase by over 16%.
An increase in coke prices coupled with a lower cost of production led to RUB 590 million or 2.6x operating profit growth. The net profit figures were further supported by the absence of one off expenses in Q2 2009
| | Q3’09 | Q2’09 | Change | Q3‘08 | Change |
| Revenue | 4,270,717 | 3,673,013 | 16.27% | 10,368,107 | -58.81% |
| Gross profit | 1,367,905 | 644,512 | 112.24% | 3,010,791 | -54.57% |
| Operating profit | 955,885 | 364,807 | 162.02% | 2,275,902 | -58.00% |
| Net profit | 753,703 | -78,370 | -56.05% | 1,714,905 | N/A |
(In thousand RUB)
NTK
An improved Q3 2009 financial performance resulted from an increase in transportation volumes, a higher share of export deliveries and an increase in the number of third parties sales. This allowed NTK to improve its financial performance in Q3 2009.
The primary cause of weaker YoY financial results was an increase in lease and rent expenditure because new rolling stock was acquired under financial and operational lease. Thus by the end of Q3 2009, NTK’s owned and leased rolling stock increased to a total of 5,180 units.
| | Q3’09 | Q2’09 | Change | Q3’08 | Change |
| Revenue | 1,403,952 | 1,150,295 | 22.05% | 1,040,904 | 34.88% |
| Gross profit | 250,466 | 141,825 | 76.60% | 329,814 | -24.06% |
| Operating profit | 196,239 | 85,752 | 128.84% | 276,282 | -28.97% |
| Net profit | 166,887 | 41,834 | 298.92% | 223,363 | -25.28% |
(In thousand RUB)
