1Q17 financial results in line with our forecasts
Severstal reported its 1Q17 results this morning. Overall, the results should be taken as neutral by the market, with EBITDA growth of 9% qoq and net income +15% qoq in line with our forecasts. The 1Q17 dividend announced last night, of RUB 24.44/share (3.2% yield, 13.3% annualised), should be well received. However, working capital outflow resulted in relatively weak FCF (down 82% qoq) which could take some of the shine off the numbers, although this is a seasonal effect which should reverse in time. Severstal’s reported EBITDA and net income were 4% and 10% behind the Bloomberg consensus. However, the consensus data we have seen appears out of date and limited, but we doubt that these results should come as a surprise to the market.ÂPAO Severstal is an integrated Iron & Steel works company with a range of products: hot and cold rolled steel, roll-formed shapes and pipes, rolled sections, a large group of coke products and by-products. Co. also has various social responsibilities such as the operation and maintenance of sports complexes, holiday and recreational facilities and public housing. Co.'s operations are organized along three principal divisions: Severstal Russian Steel engaged in crude steel production; Severstal Resources engaged in the production of iron ore concentrate, pellets and coking coal; and Severstal International engaged in the production of high-quality flat-rolled products.
WOOD & Company is the leading investment bank in Emerging Europe. Founded in 1991 and head-quartered in Prague, our footprint spans the region and touches investors around the globe.
A pioneer in Emerging Europe, WOOD executed many of the first CEE equity trades and landmark investment banking transactions. Our electronic trading platform was the first in the region, and remains the best. We are continually expanding our relevance and reach in these ever-evolving markets.
Our equity market share reflects our stature: 7% in Warsaw, 20% in Bucharest, 16% in Hungary, 40% in Prague and 5% in Vienna. Our distribution is unparalleled, with the largest salesforce in the region, servicing a uniquely diverse investor base.
We couple local expertise with a truly international perspective. With offices on the ground in the region, and in key financial hubs such as London and Milano, we are never far from our clients and we remain at the forefront of what’s afoot in the CEE emerging and frontier landscape.
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