Oyak Group is unsure of how it will adjust to deleterious economic conditions created by the COVID-19 crisis, the company noted in its quarterly earnings report.
Through the first quarter of 2020, Oyak’s total production decreased by 3.9pc to 2.23mn mt. Crude steel production at its Eregli plant decreased by 1.3pc to 914,000mt in Q1 2020 compared to the same quarter the prior year, while crude steel production at its Iskenderum plant decreased by 5.7pc to 1.32mn mt in Q1 2020 compared to the same quarter a year ago. Oyak produced 8.6mn mt of crude steel in 2019.
Oyak’s total flat product output was 1.71mn mt, with 1.31mn mt, or 76pc, hot rolled and 404,000mt, or 24pc, cold rolled. Total flat product sales declined by 12.2pc to 1.66mn mt in Q1 2020 compared to 1.89mn mt during the same period a year ago.
Long product sales decreased by 20.5pc to 267,000mt in Q1 2020 against 336,000mt in Q1 2019, while Oyak’s produced 264,000mt of long products. Iron ore and pellet sales increased by 1.5pc to 449,000mt in Q1 2020 compared to 438,000mt in the same quarter last year. Of the total, 409,000, or 91pc, of iron ore and pellets tons sold were to group companies. Oyak exported 191,000mt of flat products to 27 countries and 18,000 of long products to five countries. Export sales comprised 11pc of total sales.
The average sales price per ton on flat products decreased by 7.6pc to $538/mt in Q1 2020, decreasing from $582/mt in calendar 2019. The average sales price on longs also decreased by 3.7pc to $469/mt in Q1 2020 compared to the annual average price in 2019 of $487/mt.
The company’s sales revenue of $6.38mn in Q1 2020 declined by 10.7pc against $7.14mn in Q1 2019, and its gross profit of $877,679 declined by 46pc compared to $1.63mn. Oyak’s EBITDA decreased by 38.3pc to $1.07mn in Q1 2020 compared to $1.73mn during the same period the previous year.
As of 31 March 2020, Okay’s total investment expenses were $46mn, growing by 7pc from Q1 2019 when it invested $43mn.
Turkish crude steel output in February decreased by 5.4pc from the month prior, and increased by 8.2pc to 2.85mn mt over February 2019. Oyak’s three-month crude steel production is close to 25p of Turkey’s first quarter crude steel production.