Shares in integrated steel manufacturer Evraz (EVR) jumped nearly 5 per cent on the publication of full-year numbers, after the Russian-headquartered group announced its gargantuan net debt figure had dropped a tenth. Investors saw additional signs of reassurance in the group's year-end compliance with financial covenants, and news of a further $110m (£89m) prepayment on a syndicated loan post-period.
That's good news, because after deducting for capital expenditure, 42 per cent of the operating cash flow generated in 2016 was spent on interest payments. Higher up the P&L account, Evraz is making big efforts to contain and slash expenses, and removed $316m from the cost base.
This year, the group plans to expand domestic and overseas sales of steel railway products and increase the premium for its semi-hard coking coal production. The North American steel division, which saw contraction in revenue last year, is expected to benefit from a pick-up in oil and gas exploration activity and "a more favourable pricing environment".
On average, analysts are forecasting full-year pre-tax profit of $1.1bn and adjusted EPS of 45.5¢ this year, and $490m and 24.5¢ in 2018.
EVRAZ (EVR) | ||||
|---|---|---|---|---|
| ORD PRICE: | 241p | MARKET VALUE: | £3.42bn | |
| TOUCH: | 240-241p | 12-MONTH HIGH: | 281p | LOW: 67p |
| DIVIDEND YIELD: | nil | PE RATIO: | na | |
| NET ASSET VALUE: | 35¢* | NET DEBT: | $4.8bn | |
| Year to 31 Dec | Turnover ($bn) | Pre-tax profit ($bn) | Earnings per share (¢) | Dividend per share (p) |
|---|---|---|---|---|
| 2012 | 14.7 | -0.19 | -29.0 | 11 |
| 2013 | 14.4 | -0.64 | -34.0 | 6 |
| 2014 | 13.1 | -1.08 | -78.0 | nil |
| 2015 | 8.8 | -0.71 | -45.0 | nil |
| 2016 | 7.7 | -0.09 | -15.0 | nil |
| % change | -12 | - | - | - |
Ex-div: - Payment:- *Includes intangible assets of $1.2bn, or 83¢ a share £1=$1.24 | ||||
