Implementation of Magnitogorsk Iron and Steel Works’ (MMK) investment strategy from 2015-2025 should add $686 million to the company’s EBITDA per year. This was announced by MMK’s top management team at the company’s Capital Markets Day held in London on November 15.
At the event, MMK’s Chairman of the Board of Directors Viсtor Rashnikov, CEO Pavel Shilyaev, Independent member of the Board of Directors Tav Morgan, and CFO Andrey Eremin held a presentation for international investors, financial analysts and journalists.
“We have been focused on the consistent implementation of our development strategy and during the new investment cycle have already completed a number of key projects aimed at expanding MMK Group’s footprint in the segments for high-margin products,” said Chairman of the Board of Directors of MMK Viсtor Rashnikov. “We continue to implement our large-scale investment program focused on upgrading and improving efficiency of sinter, coke and blast-furnace production processes. I want to highlight that our new projects are also aimed at minimizing negative environmental impact in Magnitogorsk and the region. In particular, this is supported by using the best available technologies.”
Rashnikov added, that annual CAPEX at MMK was planned at $900 million per year from 2020-2023 followed by a decrease in capital investments in 2024-2025. In total the costs of MMK’s key investment projects aimed at the company’s development are expected to amount to $2.879 billion in 2015-2025.
Successful development of MMK’s production facilities and the launch of new innovative and import-substituting products have allowed the company to become the leader in Russia in terms of HVA products output. At the same time, thanks to its conservative financial policy, the company has been able to generate stable cash flow paid out to shareholders as dividends on a regular basis.
MMK’s strategy is focused on sustainable development principles, which reflect a balance between improvement in operational and financial performance and social responsibility along with environmental protection.
A key strategic priority of MMK is to improve the environmental situation in Magnitogorsk. Since 2000 the company has reduced its impact on the city’s air by half, while reducing discharge of pollutants into water fivefold. The implementation of its environmental initiatives should allow MMK to reduce its air emissions and discharge of water pollutants by an additional 20% and 70%, respectively, by 2025. (MMK/Ukrainian metal)