7th Jun 2019 08:16
LONDON (Alliance News) - Ferrexpo PLC on Friday said higher pricing, production and sales volumes will result in a material year-on-year rise in first-half adjusted earnings before interest, taxes and depreciation.
For the six months to June 30, 2018, the company recorded adjusted Ebitda of USD234 million on a revenue of USD617 million. Total pellet production stood at 5.1 million tonnes.
In its annual general meeting statement, the Ukraine-focused iron ore company said while the average cost of production is likely to increase year-on-year in the first half, cost inflation has been lower than expected due to a fall in the Brent oil price and the European gas price partially offset by an appreciation of the Ukrainian hryvnia versus the dollar.
The company also announced the appointment of former Ernst & Young executive Graeme Dacomb as independent non-executive director. Dacomb was a partner at accountancy firm Ernst & Young for 26 years. For the past 12 years, he was a lead EY partner in the extractive industry, responsible for providing services to mining and oil & gas companies.
Dacomb will be chairing the company's audit committee and will be a member of the independent review committee which is looking into matters relating to Blooming Land charity matter.
In April, Ferrexpo's auditor Deloitte LLP resigned amid a dispute over potential links between the company's chief executive and a charity being probed for misuse of funds. Ferrexpo disagreed with its auditor's conclusion of a link between Kostyantin Zhevago, its chief executive and controlling shareholder, and Blooming Land Charity, which is being investigated for possible misuse of funds.
The company said an independent review committee found Blooming Land was not related to the company or its executive management. However, Deloitte was unable to reach the same conclusion.
"The group's balance sheet remains strong with net debt expected to further reduce compared to December 31, 2018," said Chair Steve Lucas on Friday.
"The independent review into how Ferrexpo's donations to a third party charity in Ukraine were used remains ongoing. The company will make an announcement to shareholders when the Independent Review Committee completes its work. To date, after a significant amount of work on the part of our forensic accountants and legal advisors, there has been no conclusive evidence of any wrongdoing," Lucas added.
Ferrexpo said it intends to make further board appointments in due course and is also in the process of appointing a new auditor.
Shares in the iron ore pellet producer were trading 4.7% higher at 250.00 pence on Friday morning.
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