severstal: overview and forecast alexander andrianov, finance director london february 2003 overview...
Post on 29-Mar-2015
216 Views
Preview:
TRANSCRIPT
Severstal: Overview and Forecast
Alexander Andrianov, Finance Director
London
February 2003
Overview and Forecast
London
February 2003
2
Table of contents
• Market Position
• Operations
• Financials
• Stock Market
• Environmental Protection
• Conclusions
3
Overview and Forecast
Market position
4
Geographical position
Arkhangelsk
Naberejnye Chelny
Uhta
FINLAND
UlyanovskSamara -
Vyksa
St-Petersburgh
Murmansk
Moscow Nijniy Novgorod
ESTONIA
UKRAINE
RUSSIA
BELARUS
LITHUANIA
LATVIA
KAZAKHSTAN
CHEREPOVETZ - STEEL MILL
OLKON -IRON ORE
KORELSKY OKATISH -IRON ORE
Vorkuta
VORKUTAUGOL - COAL
KUZBASUGOL - COAL
Kemerovo
PONLAND
KAMAZ- TRUCK PRODUCER
AVTOVAZ- CAR PRODUCER
UAZ - JEEP PRODUCER
PIPE PLANT
GAZ- CAR PRODUCER
WATERWAY TO THE BALTIC SEA
Cherepovetz
5
Overview
Investing in the company's workforce and consequently increasing productivity. Developing motivation system
Modernisationof Production
StrategicIntegration
HumanCapital
Holding the leader position in the Russian steel industry and supplying domestic and foreign customers with high quality steel products
The optimisation of the company's steel production assets by modernising production facilities to increase the quality and expand the mix of its steel products
Investing in raw material suppliers, transportation facilities, steel consuming businesses and other projects, which add value to Severstal's core business by reducing costs and improving the reliability of raw material supplies as well as the delivery of finished products
6
Strategy
Purchases Production Sales Human Capital
• Uninterruptible supplying of Severstal
• To secure its raw materials supply safety, Severstal uses the strategy of vertical integration
• Severstal’s strong position influences the domestic raw material market
• Reducing of total purchasing costs
• Installation of automated systems for management customs
• Reducing costs and increasing quality
• Change over to 100% continuous casting steel
• Increasing the share of higher value-added products
• Targeting key consumers
• Investing in quality• Developing projects of
producing higher value-added products (Severgal)
• The domestic market is the top priority for Severstal
• Development of relationship with principal clients
• Development of sales network in export markets and direct sales in the domestic market
• Acquisitions and JV allow to increase shipments to automotive and pipe industries
• Developing training program for all categories of employees
• Developing a system of employee incentives
• Developing through its own training center
• ‘Total Quality Management’ program, ‘Production consulting’ program, the ‘Preparation of managers for spin-off businesses’ and an internal course for top managers (‘TOP-100’), international MBA
7
Macroeconomic Environment
World market
RussiaWeighted average world steel price index
(Apr-94=100)• Since 1999 the greatest output growth rate had the automotive industry ( 9% - 2000, 12% - 2001, 0% - 2002), fuel and energy complex ( 4, 4.5 and 7%) and heavy-machinery ( 20, 7 and 2%). The latest tendencies are the increasing of zinc-coated steel consumption in the automotive industry and high quality strips in FEC.
• Rolled products average spot prices were 304 US$ in 20021 per ton.
• For last 10 years, the world steel output has increased by more than 100 m. tons. The total capacity now is 1bln. tons That exceeds the world steel consumption.
• As a result of previous tendency - large amount of mergers and integrations and ineffective capacities cut-back
• In 2002 average spot price was 266 US$ per ton. • Prices on almost all products are going up.• Severstal expects further prices increase.
60
70
80
90
100
110
120
Dec-02 Sep-01 Jun-00 Mar-99 Dec-97 Sep-96 Jun-95
Asian boom boosts global prices
Asian crisis preludes global price fall
Previouscyclical peak
8
Macroeconomic Environment (continued)
Anti-dumping Proceedings
Government View
1. Russian steel export protection 2. Domestic market protection
• Import taxes are increased: USA - 30%, Mexico - 35%, Malaysia - 50%, Iran - 25%.• Argentina, Brazil, Columbia, Peru, Venezuela,Chile are likely to follow them.• Temporary import taxes are introduced against zinc-coated products from Kazakhstan and Ukraine.
• Key industries of strategic importance to Severstal include: automotive industry, pipe manufacturing, heavy machinery, ball bearing production, shipbuilding, white goods manufacturing• In 2000, Severstal began the production of high quality thin cold rolled steel sheet for refrigerators produced by Electrolux• Development of new products for special need of main clients (e.g., alumni-silicon galvanized sheet)• Relationships with key customers are based on quarterly and half-year contracts• Severstal expects sales to domestic market will rise up to approximately 52% of total sales in 2003• Severstal expects expansion of marketing outlets in automotive industry and pipe manufacturing due to its acquisitions and JV• Severstal’s average price on export sales in 2002 was 13% higher, and - on domestic sales - 3% higher than prices of its major competitors• Almost 77 % of Severstal’s domestic sales are made directly to end users, while export sales are conducted through Severstal’s export trading subsidiaries
9
Market position
Severstal continues to be among the world’s 20 largest steel producers. According to the annual research by the ‘Metal Bulletin’ magazine, Severstal occupies 19 place with 9.6 million tons of total steel output in 2002.Among Russian ferrous metal producers, Severstal is the largest company in terms of revenues and the second largest in terms of volume of steel and rolled products output.
0
10
20
30
40
50
Arc
elor
PO
SC
O
Nip
pon
Ste
el
Cor
us
Ispa
t In
tern
atio
nal
Sha
ngha
i Bao
stee
l
Thy
ssen
Kru
pp
Riv
a
NN
K
Kaw
asak
i
US
X
Sum
itom
o
Nuc
or
Chi
na S
teel
Mag
nitig
orsk
SA
IL
Sev
erst
al
Ans
han
Sho
ugan
g
Bet
hleh
em S
teel
Nov
olip
etsk
10
Market position (continued)
Sales 1999 - 2002 by market, thousand tons
The increase in margins on domestic sales has, in part, caused Severstal to direct more of its sales to domestic customers.
Another reason of export sales reducing is antidumping proceedings.
4349387638763118
4111441344134723
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
1999 2000 2001 2002E
Export
Domestic
11
Domestic sales
Severstal sells to customers in a number of different industries. The main customer base in the domestic market are the automotive industry and pipe manufacturing companies.
Severstal increasingly focuses on customers with demand for higher value-added products.
32% of sales to pipe industry comprised high-quality alloyed strip.
The automotive industry mostly consumes cold-rolled sheets (65%) and thin hot-rolled sheets (18%).
DOMESTIC REVENUES in 2002E (% of Total Revenues by Product)
0.0 20.0 40.0 60.0 80.0 100.0
Steel sections
Cold-rolled sheet
Hot-rolled sheet
DOMESTIC CONSUMPTION BY INDUSTRY in 2002E (% of Domestic Sales Revenue)
0.0 5.0 10.0 15.0 20.0 25.0 30.0 35.0
Regional Distribution
Shipbuilding
White Goods
Heavy Machinery
Metalware
Automotive Industry
Fuel and Energy Complex
DOMESTIC SALES REVENUE BY INDUSTRY (% of Domestic Sales)
0%
20%
40%
60%
80%
100%
2000 2001 2002E
Regional Distribution
Shipbuilding
White Goods
Heavy Machinery
Metal processors
Automotive Industry
Fuel and Energy Complex
12
Export sales
Severstal exports its products to 94 countries world-wide, which makes it the largest exporting company among Russian steel producers.
Severstal's export sales include a higher share of value added products such cold-rolled, pickled and galvanised steel.
Europe, in particular the Western Europe, is a strategic market for Severstal's exports. The company has strong relationships with its European customer base and is confident that its joint venture with Arcelor will further increase the company’s position in this market.
EXPORT CONSUMPTION BY REGION in 2002E (% of Export Sales Revenue)
0 5 10 15 20 25 30 35 40
Central and South-East Asia
Europe
Middle East
Africa
Central and South America
USA
EXPORT SALES REVENUE BY REGION (% of Export Sales)
0%
20%
40%
60%
80%
100%
2000 2001 2002E
USA
Central and South America
Africa
Middle East
Europe
Central and South-EastAsia
13
Key customers
Key customers in the domestic automotive sector are Gorkovsky Automotive Works (GAZ), Voljsky Automotive Works (AvtoVAZ), Ijmash-Auto and UAZ
Principal domestic customers in pipe manufacturing are the Vyksunsky and Chelyabinsky pipe plants
The major consumer in metal processors is Cherepovets Steel Rolling Mill (ChSPZ), which is a part of the metallurgical branch of Severstal Group
Severstal's major clients: Viksa metallurgical works, Cherepovets Steel Rolling Plant, AutoVAZ and GAZ, accounted for approximately 24% of the total volume of Severstal’s domestic sales in 2002. Viksa metallurgical works - pipe producing company, accounts for more than 7% of Severstal's total sales revenues.
LARGEST DOMESTIC MARKET CUSTOMERS BY SALES VOLUME
Key clients24%
others76%
Viksa Metallurgical Works41%
ChSPZ31%
AutoVAZ16%
GAZ12%
KEY CUSTOMERS BY SALES VOLUME IN INDUSTRIES in 2002, %
72 70
30 30
1611
3
0
20
40
60
80
AutomotiveIndustry
Metalprocessors
Fuel andEnergy
Complex
Shipbuilding HeavyMachinery
White Goods RegionalDistribution
14
Challenges and Competitive Advantages
OUTPUT, thousand tons
8 5218 0608 315
7 1517 351 7 966
9 5958 384 9 011
0
2 000
4 000
6 000
8 000
10 000
12 000
2000 2001 2002ESeverstal NLМК ММК
SALES REVENUE, mn $
1 7892073 1922
1 1511 276
1 5261 559
1 8181 555
0
500
1 000
1 500
2 000
2 500
2000 2001 2002E
Severstal NLMK MMK
PRICES, $/tn
239
202214
174161
192186 190173
0
50
100
150
200
250
300
2000 2001 2002
Severstal NLМК ММК
15
Competitive Environment
Russian Steel Industry
•Magnitogorsky Metallurgical Kombinat (MMK)•Severstal•Novolipetsky Metallurgical Kombinat (NLMK)•West-Siberian•Nijny Tagil Metallurgical Kombinat (NTMK)•Kuznetsky•Mechel•Nosta•Oskolsky
Tons 2000 2001 2002Domestic Sales 47% 47% 52% Export Sales 53% 53% 48%
GMK EurasHolding
Production output in 2001
The division of the Russian Market (2002)
Coke Cast iron Steel Rolled metal
Severstal 4028 7447.9 9303 8060
MMK 4869 8657.9 10314.6 9108.7
Mechel 2257 2905 3796 2837
NLMK 4349 7464 7912 7374
West Sibirean 3385 4546 5579 4632
Nosta 1312 1786 2591 1944
KMK 1193 2751 3596 2627
NTMK 2893 4629 5225 3625
Î skolsky - - 2119 1886
2002
Severstal 4100 7732 9648 8521
Nos ta5%
Os kols ky4%
Other12%
Mechel7%
EvrazHolding
22%
NLMK15%
MMK19%
Severs tal16%
16
Overview and Forecast
Operations
17
Flow diagram
100
100
80100
125150
/
/
/
Hot Strip Rolling Shop № 2
Formed Section Shop
Section Rolling Shop
Cogging Mill
Converter Shop
Electric Steel Melting Shop
Coke-Oven Plant
Blast Furnace Plant
Sintering Plant
This shops will be closed
Open Hearth Shop
Hot Strip Rolling Shop № 1
Hot Strip Rolling Shop № 3
Cold Strip Rolling Shop
18
Production facilities
Severstal has a crude steel production capacity of 10.9 million tonnes per annum. With a total production output of 9.65 million tonnes in 2002, Severstal’s crude steel capacity utilisation rate was 88.5 %, or 3 p.p. higher than in 2001. Between 1995 and 2000, the company’s average capacity utilisation rate was 80.9%, compared with 76% on average for the Russian steel industry.
Production capacity (Mn tn/year)
Equipment
Coking Plant 4.1 7 BatteriesSintering Plant 7.6 8 MachinesBlast Furnace 7.6 4 FurnacesBasic Oxygen Converters 8.0 3 FurnacesElectric Arc Furnace 1.3 2 FurnacesOpen Hearth Furnace 1.8 3 FurnacesContinuous Casting 8.8 7 CastersHot Rolling Mills 8.2 4 MillsCold Rolling Mills 2.5 2 MillsSection Rolling Mills 2.2 3 MillsCold Roll-Forming Lines 0.25 4 LinesPipe Rolling Mills 0.28 6 MillsHot Dip Galvanising Lines 0.5 2 LinesContinuous Picking Lines 2.8 3 Lines
19
Production efficiency
Low grade and waste production, %
Fuel consumption
ElectricityconsumptionkW*h/ton
Metal yield,%
Planned idle time,%
Hot rolling mill
Severstal (mill 2000) 85.4 114.9 95 16.7Arcelor 78.9 81 97.7 16.19Cold rolling millsSeverstal (cold rolling) 76.8 87 12.8Nippon Steel (Nagoya) 55.8 5.49
kg/ton
92
0.67
3.69
0.58 0.54 0.75
4.623.793.54
0
1
2
3
4
5
1999 2000 2001 2002E
Waste
Low-grade
20
Exports by product
4.1 m t 4.8 m t 5.1 m t
Severstal
Cold rolled flat products
23%
Other rolled steel products
57%
Semi-finished16%
Coated rolled steel products
4%
Value-addedproducts
27%
ММК
Other rolled steel products
60%
Cold rolled flat products
16%
Coated rolled steel products
1%
Semi-finished23%
Total export sales
NLMK
Other rolled steel products
31%
Semi-finished53%
Cold rolled flat products
14%
Coated rolled steel products
1%
Electric steel1%
Severstal has the biggest share of high value-added products on export markets. It differs Severstal from other Russian metallurgical manufactures
Value-addedproducts
17%
Value-addedproducts
16%
21
Domestic market by product
4.4 m t 4.2 m t 2.1 m tTotal sales
Value added products30%
Value added products27%
Value added products52%
Severstal ММК NLMK
Other rolled steel products
70%
Semi-finished3%
Coated rolled steel products
7%
Cold rolled flat products
20%
Other rolled steel products
48%
Semi-finished0%
Coated rolled steel products
13%
Electric steel1%
Cold rolled flat products
38%
Other rolled steel products
70%
Cold rolled flat products
23%
Coated rolled steel products
7%
Semi-finished0%
22
Total sales by product
8.5 m t 9.0 m t 7.2 m tTotal sales
Value added products29%
Value added products25%
Value added products27%
Severstal ММК NLMK
Other rolled steel products
63%
Cold rolled flat products
23%
Coated rolled steel products
6%
Semi-finished8%
Other rolled steel products
61%
Semi-finished14%
Coated rolled steel products
5%
Cold rolled flat products
20%
Other rolled steel products
35%
Semi-finished38%
Coated rolled steel products
4%
Electric steel1%
Cold rolled flat products
22%
23
Production development
Rollingfacilities
Castingfacilities
Steel-makingfacilities
Coking plant and blast furnaces
Energy saving
US$ 296 million
US$ 120 million
US$ 75 million
US$ 250 million
US$ 11.6 million
• Reconstruction of blast furnaces №№ 1,2,4,5• Reconstruction of coke-oven batteries №№ 3,4,7• Environmental protection
• Open hearth furnaces shutdown• Iron desulphurisation unit• Environmental protection
• Reconstruction of continuous casting machine in BOF plant• Construction of continuous casting machine for long products
in EAF plant• 100% continuous casting in BOF and EAF plants
• Reconstruction of mills: automation, quality improvement of rolling and cutting
• Reconstruction of mill 5000 to produce high quality strips for large diameter pipes
• Increase in pickling capacity to 1.8 million tonnes per year• Conversion to 100% hydrochloric pickling
• Increase own power generating facilities to 245.3 million kW*hours
• Installation of new drives with lower electricity consumption in shops
24
Overview and Forecast
Financials
25
Financial result for 2002
• In 2002 the revenues went up by 7.5% y-o-y mainly due to higher prices both on the domestic and export markets.
• Increase in prices contributed up to 93% of the total revenue growth.
• Costs grew 3.6% all through the year due to increase in prices and structure of suppliers of raw materials, tariffs on electricity and gas.
• Severstal took steps to hold its costs through internal saving programs and purchase optimization.
• Severstal took a conservative approach for forecasting, and the actual results turned to be generally better than expected.
$’000
2001 2002ESales 1,789 1,924Cost of sales 1,463 1,515Gross profit 326 409Profit from operations 92 277Capex 79 119Net cash from operating activities 80 109
0
500
1,000
1,500
2,000
2,500
1999 2000 2001 2002E
Sales Gross profit Profit from operations
26
Changes in sales for 2002
- 14 540
other
35 886 88 182
due to changein prices
16 9426 538
due to change in volumes
133267
due to change inproduct mix
1 923 556
815 785
1 106 760
676 120
1 113 017
1 789 137
Total change
+ 134 419
500 000
1 000 000
1 500 000
2 000 000
0
- domestic market - export
$’000
+23 801
+124 748
+ 410-14 540
2001actual
2002E
27
Cost of sales structure
2002 2001
Coal11.7%
Ore and alloys26.9%
Other materials
13.2%
Fuel and energy10.4%
Labour12.9%
Depreciation8.8%
Repair and maintenance
9.2%
Other expenses
6.9%Coal13.6%
Ore and alloys23.9%
Other materials12.4%
Fuel and energy9.7%
Labour11.3%
Repair and maintenance
8.4%
Depreciation12.4%
Other expenses
8.3%
28
Capital expenditure
• Over the period from 2003 to 2005 total investment requirements are US$ 674 m.
• These investments will be financed by own resources at 55%, and 45% externally.
Major items:• Reconstruction and commission of blast furnace #4• Repair of blast furnaces currently operating• Modernisation of all continuous casting machines at
converter shop• Reconstruction of Mill 5000: installation of automated
systems; reconstruction of heating facilities; installation of sheet straightening machines
• Conversion to 100% hydrochloric pickling at cold rolling shop
• Construction of additional set of bell-type annealing furnaces at cold rolling shop
Capex in 2000-2006, $ mnTotal investmentrequirements
US$ 752 m
Own
resou
rces
55.6%
Debt
finan
cing
44.4%
Total investmentrequirements
US$ 674 m
Own
resou
rces
55%
Debt
finan
cing
45%
0
50
100
150
200
250
2001 2002E 2003F 2004F 2005F
29
Financial policy
• Debt is cheaper. Equity needs better compliance with equity market regulations. Severstal moves towards this through IAS accounting and consolidation
• Severstal works exclusively with banks that provide complex services for clients, and that consider Severstal as VIP client, providing it with favourable fees
• Severstal places its free cash only in reliable banks (like foreign bank branches)
• Severstal diversifies its deposits by maturity in respect of currency and type of value stock
30
Financial Management
Sources of external financing• Severstal uses debt financing only. As at 30 September 2002 Severstal’s debt
profile comprised US$ 155 mil., 66% of which is dollar denominated• Planned debt financing through syndicated loan and domestic bonds emission at
aggregate amount of US$ 200 mil. maturing within 3 years• Severstal shifted to long term debt because they have more beneficial credit terms• Banks’ practice is to secure its loans by pledging of assets and export revenuesWorking capital management
Severstal performs working capital management through its budgeting system, which consists of:
• Inventory stock control – keeping necessary volume of stock according to production requirements and repair and maintenance requirements
• Allowable level of receivables – a monthly control of debtors level for individual customer
• Available level of payables – seeking for most beneficial contract terms with suppliers
• Monthly payment planning – any payment can be made in accordance with authorized budget
31
Social Responsibility
• Severstal employs about 37,700 people of total 350,000 living in Cherepovets.
• Social assets comprise certain cultural, resort and sports facilities (ice hockey stadium, basin, sports grounds), as well as certain food processing and catering facilities. Severstal regards its employees as one of its key success factors and intends to provide them with a set of social services. The total amount spent in 2002 for social services provided to its employees is $ 9.6 million. In 2001 it was $11.8 million.
• Severstal also maintains a voluntary pension fund for its former employees. Payments to the pension fund were $ 4.5 million in 2002 and $ 4.8 million in 2001.
• In 2002, Severstal comprised 45.7% in Cherepovets’ budget tax income and 50.2% in Vologodskaya oblast’s budget tax income. In 2001, it was 50.5% and 56.3% respectively.
32
Key resume points
• Strong liquidity position• Good relationship with banks to meet necessary
funding requirements at beneficial cost• Significant own profits and cash flows• No events of default on liabilities• Costs planning and control in place• Internationally recognizable financial reporting and
forecasting
33
Overview and Forecast
Stock Market
34
Ownership Structure
As of 01.01.2003
A.Mordashov16.63%
Severstal-group
21.99%
Severstal-Garant43.72%
Portfolio Investors
8.20%Other9.46%
35
Share Performance
• Severstal outperformed the Russian stock index in the H1 2002. The higher steel prices supported the buying rage of the market players. In the H2 2002 Severstal followed the general decline in the market, but it is 20% higher YTD.
• The restructuring of the company was also a strong incentive to increase the share of Severstal in portfolios as the dividend payout (shares of Severstal-Auto and Severstal –Resource) gave the cheap entry into the new sectors of the market. We expect Severstal would outperform the market in the mid-term period.
Severstal Performance, $
Severstal vs. RTS Index, (03/01/02 = 1.0)
30
60
90
03/01/02 03/05/02 03/09/02 03/01/03
1.0
1.2
1.4
1.6
1.8
2.0
01/02 03/02 05/02 07/02 09/02 11/02 01/03
Severstal RTS
36
Overview and Forecast
EnvironmentalProtection
37
Principles of environmental protection policy
Severstal’s environment management system is certified in September 2001 with ISO – 14001
• To continuously reduce the harmful impact of productionactivities on environment to technically achievable andeconomically acceptable level;
• To optimize production processes for continuous reduction ofspecific consumption of natural resources and energy per tonof output and to utilize accumulated and generating waste;
• To continuously improve the environmental management system as a part of stable competitive advantage;
• To hold the fair and constructive dialog with all interested parties
38
Pollution Emission
Pollutionemission into atmosphere
Pollutionemissionsin waters
Stocking ofproduction
waste
‘000 tons
‘000 tons
‘000 tons
Actual Limit
353339 335 339
418
388 392408
0
100
200
300
400
500
12
1817
1616 1617
18
0
5
10
15
20
264
533 546
486496
703
773
641
0
200
400
600
800
1999 2000 2001 2002
39
Environmental protection expenditures
- current costs reduced due to changes in calculation methodology according to new Statutory rules*
$ mn
1.91.61.61.4 2.02.26.1
18.1 4.85.17.0
45.1
0
15
30
45
60
75
1999* 2000 2001 2002
Statutory charge for pollution New environmental activities
Current costs
40
The major environmental activities
• 1999• cleaning complex for Fuchs ladle furnace;• construction of equipment for production waste utilization;• construction of water recycling unit in hot rolling shop #1;• construction of cleaning complex at drainage output• construction of water recycling unit in BOF shop
• 2000• construction of cleaning complex at drainage output• construction of oiled calx utilization unit in hot rolling shop #2;• construction of equipment for production waste utilization;• reconstruction of cyclone cell system in agglomerate shop;• completion of construction of water recycling unit in BOF shop
• 2001• reconstruction of cyclone cell system in agglomerate shop;• construction of supporting dams and inclined drainage unit in the ash-and-slag storage;• reconstruction of biochemical entrapment equipment to clean and recycle the cooling in the coke shops
• 2002• reconstruction of the primary furnace in the stove of the blast furnace #5• construction of the oil waste recovery unit• construction of the gas cleaning unit in the pig iron desulphurization shop
41
Overview and Forecast
Conclusions
42
Challenges and advantages
• Cycle in the steel industry • Higher competition level• Complexity of consolidation• Quotas, anti-dumping• Excessive capacities in the steel
industry• Competition by mini-mills• Increasing share of Ukrainian
manufactures in the Russian market
• Geographic Location
• Transportation facilities (alternative)
• Security of Raw Materials and Energy Supply
• Tight Production Costs Control
• Personnel’s qualification
• Low labour costs
• Product Range
• Customer Base
• Technology
• Financial Position
• Production capacities
• Corporate Governance
• Stable Ownership Structure
Main challenges Competitive advantages
43
Final Summary
• Severstal objectives are: modernization of production facilities, value-added products development (SeverGal) and increasing productivity
• The capital investment program includes a number of projects aiming at manufacturing of value-added products, maintenance volumes of production and improvement of products quality. The management structure provides the suitable level of controllability of the Group’s companies
• Severstal’s strategy provides long-term attractive return on employed capital, stable cash flow and increasing profit
• The management system is being introduced within the Group’s companies, increasing their transparency and operational efficiency. The company is going through its transformation intro a leading integrated steel manufacturer.
• Although, the domestic market of high quality steel products is increasingly competitive, Severstal believes its cost control strategy and upgrading production facilities policy will lead to a significant efficiency advantage over a number of competitors and ultimately preserves Severstal’s leading position.
• As part of it’s development, Severstal applies for a long-term corporate credit rating to enhance the company’s liquidity
top related