ArcelorMittal Kriviy Rih, the largest mining and steel company of Ukraine, reports on its results in 2019.
Net income from the sales of products was UAH 62.4 billion (compared with UAH 68 billion in 2018).
Net loss is UAH 2.3 billion (compared with UAH 9.5 billion of net profit in 2018).
The results of 2019 net loss of ArcelorMittal Kriviy Rih are due to significant drop in prices for steel products on the world markets along with increase of the main costs of the plant (increase in railway tariffs and energy prices, as well as rise in environmental tax, land rent and wages fund).
Despite the fact that 2019 brought losses to the company, ArcelorMittal Kriviy Rih continued the modernization program and invested $415.4 million in the development of production. Of these, operating expenses amounted to $116 million and capital expenses to $299.4 million.
Modernization of capacities, environment protection activities, improvement of the level of industrial safety, implementation of a large-scale investment program of the company are the priority areas for the provision of funds.
Major investment projects include the modernization of the light-section mill No. 250-4 (over $60 million), the construction of two new continuous casting machines (over $160 million) and the modernization of the Sinter Plant No. 2 ($170 million). In addition to that, in 2019 the company continued modernization of equipment in Mining Department, capital and current repairs of equipment and also financed the actions to reduce its environmental impact.
Commenting on the results of 2019, Mauro Longobardo, CEO of ArcelorMittal Kriviy Rih, noted: “In the past two years, the companies of mining and metallurgical complex of Ukraine have acutely felt the crisis, similar to those that business is currently experiencing worldwide in connection with restrictions and closure of the borders due to coronavirus pandemic. Last year, the global steel flow has changed significantly because of the protectionist policy, protection of own national producer and prohibition of import in many countries. Ukrainian exporters had to make more efforts to sell their steel products due to a significant drop in prices and a general decrease in steel consumption on the world markets. Along with the rising costs, this negatively affected the financial condition of steel companies worldwide, including ArcelorMittal Group. However, despite the unfavorable market conditions of the last year, ArcelorMittal Kriviy Rih demonstrated a margin of safety and managed to fulfill its obligations to the employees, customers, suppliers and contractors. Having faced with a new unprecedented economic challenge in 2020, we are coordinating the efforts of the whole team of our professionals to combat the extension of COVID-19. We continue closely monitoring the dynamically changing situation and believe that it will be possible to maintain the level of production and continue the implementation of the strategic projects in the company”. (AMKR/Ukrainian metal)