Russian steelmaker Severstal has announced its financial results for the second quarter and the first half of 2013. Accordingly, in the second quarter Severstal registered a net loss of $44 million, compared to a net profit of $155 million in the corresponding quarter of the previous year. In the second quarter of the current year, Severstal's sales revenues decreased by 8.2 percent year on year to $3.41 billion.
During the first half of the current year, Severstal's operating profit decreased by 42.7 percent year on year to $500 million, while the company's revenues saw a decrease of 8.9 percent to $6.7 billion, as a result of lower prices.
Severstal's EBITDA in the first six months decreased by 27.2 percent year on year to $909 million, reflecting lower steel, iron ore and coking coal prices, while its EBITDA margin for the given period was 13.5 percent, down from 16.9 percent recorded in the first half of 2012.
According to Severstal's statement, in the third quarter steel demand in Russia and the US is expected to remain strong with moderate upward pricing movements. However, European demand remains weak, and China will continue to face the problem of oversupply. While the short-term outlook for the steel industry is showing signs of improvement, over the medium to long-term, Severstal expects the market to remain challenging.
Additionally, earlier this week, the international credit ratings agency Moody's changed Severstal's rating outlook from stable to positive. The upward revision reflects Severstal's strong operating performance and favorable cost structure.
