Ferrexpo PLC said its profit halved in the first quarter of 2015 after revenue was impacted by lower iron ore prices and lower sales.
The iron ore miner operating in Ukraine said its pretax profit in the first quarter of 2015 halved to $72.1 million compared to a $145.0 million profit a year earlier as revenue plummeted to $257.6 million from $413.5 million.
Selling and distribution costs fell to $57.1 million from $91.0 million with general and administrative costs experiencing a slight fall, offset by other expenses almost doubling to $9.6 million from $5.4 million and finance costs increasing by over $2.0 million.
Earnings before interest, tax, depreciation and amortisation fell 41% to $112 million from $190 million.
In the quarter, pellet production rose by 2% YoY, to 2.9 million tons from 2.8 million tons, boosted by higher grade 65% iron pellet production of 2.5 million tons from 1.4 million tons. However, total sales fell 2% to 2.8 million tons.
The company’s cash cost in the quarter was significantly down year on year to $33.2 per ton compared to $50.5 per ton a year earlier. However, this was offset by lower prices with its 62% iron ore only achieving $63 per ton compared to $120 per ton.
Ferrexpo significantly cut its capital investment in the quarter to only $12 million compared to $78 million that was spent in the same period a year earlier. (https://www.lse.co.uk/AllNews.asp?code=1owu8t1z&headline=Ferrexpo_Quarterly_Profit_Halves_As_Revenue_Hit_By_Lower_Sales_Prices/Ukrainian Metal)