Mechel's Q1 Net Up By 226%

Steelmaker Mechel said Wednesday that its net profit rose 226 percent to $205 million in the first quarter of 2007 on higher output and prices.

The New York-listed company, which also produces coal and nickel, said in a statement that revenues grew by 65.9 percent from the same period a year earlier to $1.42 billion.

Earnings before interest, taxation, depreciation and amortisation were $355.5 million, up 164.5 percent. Mechel's EBITDA profit margin widened to 25.1 percent from 15.7 percent.

"The company has demonstrated a significant rise in all directions compared to the same period last year, to which success in increasing production and its efficiency, as well as favourable prices have contributed," a Mechel statement said.

Russia is the world's fourth-largest steel producer and fifth-largest coal miner, sectors in which Mechel intends to expand production through its investment plan.

The company is majority owned by billionaire Igor Zyuzin, ranked Russia's 34th-richest man by Forbes magazine.

Mechel's steel output rose by 9 percent to 1.5 million tonnes in the first quarter of this year, pig iron by 13 percent to 930,000 tonnes and rolled steel production was up 19 percent at 1.3 million tonnes.

Coal output rose 13 percent to 4.5 milion tonnes, including 2.2 million tonnes of coking coal, while iron ore concentrate declined by 3 percent to 1.1 million tonnes and nickel was up 22 percent to 4,10 tonnes.

Coke output rose 82 percent to 930,000 tonnes.

Source: The Moscow Times, Tuesday, July 12, 2007