Ferrexpo al= locates USD 40 mln for concentrator, shifts approval for 2014 .

Ferrexpo al= locates USD 40 mln for concentrator, shifts approval for 2014 .



17 жовтня 2013 года
Конкорд Капитал

Ferrexpo (FXPO)


Iron ore miner Ferrexpo (FXPO LN) = reported on October 17 it sold 7.6 mmt of pellets in 9M13 (+9% yoy), 5.6% l= ower than production during the period, due to a lag in shipments. The sell= ing price declined 4.5% qoq (to USD 120/t on a FOB/DAF basis, we estimate) = in 3Q13. C1 cash costs in 3Q13 decreased 2.5% qoq to USD 58.2/t due to high= er production volumes and a higher quality of ore extracted from Yeristovo.= The company boosted its budget for= its quality upgrade project (enabling it to produce 100% higher grade pell= ets, 65%-Fe, starting 2015) by USD 24 mln to USD 236 mln to fund the constr= uction of its additional tailings facilities. On top of that, the company a= pproved USD 40 mln for the development of the infrastructure for a new 10 m= mt concentrator, labeling the prospects of the project as strong. Ferrexpo = expects to announce further approvals of the project in 2014, according to = the release.

Roman Topolyuk: Ferrexpo explained= the decrease in average selling price by a lag in fixed contracts settled = with customers in Europe, so the company’s selling price might improv= e in 4Q13 as the spot price for 62%-Fe fines (CFR, China) grew 4.8% qoq in = 3Q13. Despite the company labeling the concentrator project as the one that= has strong prospects, partially financing its implementation, in fact Ferr= expo has effectively shifted approval of the project to 2014, representing = a cautious approach to spending USD 600-700 mln in CapEx in an uncertain pr= icing environment.
http://www.fixygen.ua/rs/companiesreviews/9632/

Источник: Конкорд Капитал

Аналитик: Роман Тополюк
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