Avdiyivka Coke reports positive bottom line in 2Q14

Avdiyivka Coke reports positive bottom line in 2Q14



24 липня 2014 года
Конкорд Капитал

Авдеевский коксохимический завод (AVDK)


Avdiyivka Coke (AVDK UK), the leading coke producer of Metinvest Holding, boosted its revenue 12% yoy to UAH 4,146 mln in 1H14, according to the company’s July 24 release. Its 1H14 EBITDA was negative at UAH 182 mln, though improving from UAH 357 mln in losses in 1Q14. The company’s bottom line was UAH -297 mln in 1H14, vs. positive UAH 29 mln in the same year-ago period.



The company’s semi-annual result implies Avdiyivka improved its revenue 28% yoy to UAH 2,332 mln in 2Q14. Its EBITDA for the quarter, UAH 175 mln, is a significant improvement from its negative result in 1Q14 (UAH -357 mln) and is 2.2x higher yoy. Its quarterly bottom line was positive at UAH 74 mln (vs. UAH 5 mln losses in 2Q13).



Roman Topolyuk: Avdiyivka’s improved financial performance in 2Q14 was an expected development, which was the result of greater plunges in prices for coking coal (its key raw material), as compared to decreases in coke prices.



We would expect this positive trend to persist to the year end if not for the reported damage to infrastructure and production facilities during bombardment on July 22. Despite the company claiming that repairs would take just 1-2 days, it has yet to report on their completion.



Meanwhile, Avdiyivka plans to cut coke production by half m/m to 150 kt in July, due to a lack of adequate electricity and water supply to the production site, according to Metal Courier. The uncertain timing of Avdiyivka’s recovery will negatively impact its 3Q14 financial results and may prevent the company from returning to generating positive EBITDA and bottom line that we expected for 2014.

Источник: Конкорд Капитал

Аналитик: Роман Тополюк
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