Evraz plc (LON:EVR) have seen their shares crash on Thursday, following the announcement of its final results.
The steel maker said that full year profits had dropped, as trading was hurt by less “favorable” global steel and commodity markets.
2019 revenues slumped 7.3% to $11.91 billion from $12.84 billion, whilst pretax profit also crashed 72% from $3.2 billion to $902 million.
Earnings before interest, taxes, depreciation, and amortisation fell also, to $2.6 million from $3.78 billion.
Evraz blamed this slump on “lower vanadium and coal product prices as well combined higher expenses”. Looking at their steel division, the firm also saw revenues drop 8.3% year on year, to $8.14 billion.
The steel producer added that they will pay a $0.40 interim dividend, which is flat from a year ago. The firm added that this “reflects the Board’s confidence in the Group’s financial position and outlook.”
Evraz Chief Executive Officer, Alexander Frolov, commented:
“In 2019, global steel and commodity markets were not as favourable as they were in 2018. Steel prices have fallen as a result of excess supply in an environment of limited end-use demand. Global coal and vanadium markets returned to supply-demand equilibrium. Despite the market headwinds, EVRAZ was able to deliver resilient results with EBITDA reaching US$2,601 million and EBITDA margin reached 22% in 2019.
Retention of our low-cost and market leadership positions remain very important for EVRAZ. During the reporting period, the efficiency improvement programme delivered an EBITDA effect of US$407 million from customer focus and cost-cutting initiatives.
In 2020, EVRAZ will continue to make significant efforts to improve safety and other vitally important areas of sustainable development. The Group has also set ambitious production targets for the year that should help it to reach solid results despite potential market headwinds.”
Evraz shareholders will hope that the firm can bounce back from a mixed year for the firm, however with more political certainty and a favorable macroeconomic environment, the firm should remain optimistic.
Shares in Evraz trade at 347p (-7.75%). 27/2/20 12:43BST.
