Russian steelmaker Mechel’s revenue in the first quarter of 2020 rose significantly thanks to growth in its steel segment.
That aspect of the company’s business enjoyed a spike in sales to the country’s rail sector, as well as production costs that declined because raw material prices fell. Mechel’s sales to Russian railways increased by a third and its rail export sales doubled in Q1 2020 from the previous quarter.
Flat rolled steel sales rose by 11pc and stainless steel flat rolled jumped by 38pc in Q1 2020 from the fourth quarter of 2019. Mechel’s forging product sales also increased by half.
Mechel’s EBITDA from steel sales increased by 39pc in Q1 2020 from Q1 2019, and it rose significantly by 101pc from Q4 2019. The main reasons for such a drastic EBITDA rise are that the prices for iron ore concentrate, coke, ferroalloys, and electrodes all decreased.
The company’s steel division saw a 22pc spike in revenue in Q1 2020 compared to Q1 2019, as well as a 12pc rise from Q4 2019.
Mechel’s total revenue, including its steel, mining and power segments, decreased by 9pc in Q1 2020 from Q1 2019, but remained flat from the previous quarter. Its total operating profit decreased by 35pc last quarter from Q1 2019, while it surged by 174pc from Q4 2019. Mechel’s EBITDA declined by 17pc in Q1 2020 from Q1 2019, but it rose by 36pc from Q4 2019.