WOOD Flash – Severstal: 2Q19 financial results – in line with consensus, 13.6% EBITDA growth, but falling FCF, with 2.5% quarterly dividend yield
Severstal announced its 2Q19 financial results this morning (19 July), which were broadly in line with both our forecasts and the consensus. While the 2.5% yield implied on the announced dividend was weaker than investors have come to expect from Severstal, the payout was still strong, at 133% of the FCF. Despite 13.6% growth in the EBITDA qoq, the FCF dropped, due to higher capex and a build-up in working capital, which limited the dividend potential in 2Q19, although the improving prices and the potential for destocking in 3Q should bode well for a higher payout next quarter, in our view. We see these results as neutral for the share price.
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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