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MMK Q3 2009 RAS financial results

27th Oct 2009 07:00

RNS Number : 4157B

OJSC Magnitogorsk Iron &Steel Works

27 October 2009

October 27, 2009

OJSC "Magnitogorsk Iron and Steel Works" (MMK)

financial results under Russian Accounting Standards (RAS) for 3Q 2009

The results reflect MMK operations only and do not relate to subsidiaries or affiliated companies.

Key Q3 2009 operational highlights

Crude steel output amounted to 2.8 mln tons (+31% q-o-q).

Finished steel products output equaled to 2.6 mln tons (+36% q-o-q).

Key financial highlights

The production volume in Q3 2009 grew significantly compared to Q2 2009. MMK management continued supporting the low level of cash cost and optimizing the structure of production portfolio.

HVA products output grew by 29% compared to Q2 2009 and amounted to 735 thousand tons, which is at the pre-crisis level.

The share of HVA products equaled 28% in Q3 2009 and accounted for 37% of total revenue from steel products sales.

The share of domestic and CIS sales stood at 54% and provided for 60% of total revenue from steel products sales.

Key Q3 2009 Profit & Loss statement figures

Q3 2009 revenues increased by 48% q-o-q and amounted to RUR 41.5 bn

Operating income went up by 94% compared to Q2 2009 and stood at RUR 9.2 bn mainly due to the increase of steel products output by 36% and the growth of the average price for steel products by 10%

Net income amounted to RUR 7.2 bn in Q3 2009

The change of net income in Q3 2009 compared to Q2 2009 is attributed to the following factors:

operating income growth

non-cash operation on financial investments revaluation (due to market prices fluctuations of foreign entities' securities in possession of MMK).

Balance sheet as of September 30, 2009 (compared to balance sheet as of January 01, 2009)

Total assets increased by 6% and amounted to RUR 222.5 bn

The balance sheet value of non-current assets grew by 21% and amounted to RUR 155.2 bn in the result of:

increase of the balance sheet value of fixed assets by 40% to RUR 73.6 due to the construction of Mill 5000 complex and Colour Coating Line №2

positive revaluation of long-term investments by 26% to RUR 35.7 bn (mainly due to market prices fluctuations of foreign entities' securities in possession of MMK).

Current assets value decreased by 18% to RUR 67.2 bn mainly due to the following:

decrease of receivables by 11.5% or RUR 4.06 bn due to repayment of trade accounts receivable by 28% to RUR 17.04 bn

decrease of inventories by 19.4% or RUR 3.45 bn as the result of the working capital optimization programme

cash and short-term financial investments amounted to RUR 19.97 bn.

Long-term liabilities increased to RUR 37.6 bn as the result of investment programme implementation.

Short-term liabilities went down by 2.4 times due to repayment of short-term loans and credits by RUR 10.45 bn and decrease of trade accounts payable by RUR 14.6 bn.

Contacts

Evgeny Kovtunov

+7 3519 24 93 55

e-mail: kovtunov@mmk.ru

* * *

Financial statement for Q3 2009 results under RAS is to be found at: http://www.mmk.ru/eng/invrelations/b_reports/r_reports/index.wbp

Information on MMK:

The Magnitogorsk Iron and Steel Works OJSC (MMK) is among the world's largest steel producers and is one of the leaders of Russia's steel industry. The Company is a large steel producing complex encompassing the entire production chain, from preparation of iron ore to downstream processing of rolled steel. MMK turns out a broad range of steel products with a predominant share of value added goods. In 2008 the Company produced 12m tonnes of crude steel and 11m tonnes of commercial products. MMK Group sales stood at USD 10.550bln.

This information is provided by RNS

The company news service from the London Stock Exchange

END

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