March 5 (Bloomberg) -- OAO Severstal, billionaire Alexey Mordashov’s steelmaker, posted a net loss in the fourth quarter after a profit in the prior three months as prices fell.
The net loss was $150 million after profit of $329 million, Severstal said in a statement today. Earnings before interest, taxes, depreciation and amortization slumped 36 percent to $347 million, missing the $367 million average estimate of 13 analysts surveyed by Bloomberg. Sales slid 13 percent to $3.12 billion.
Steel prices dropped as demand slowed and China increased exports. Benchmark hot-rolled coil sold abroad from the former Soviet republics declined to $510 a metric ton in October, the lowest level since January 2010, according to Metal Bulletin data compiled by Bloomberg. Severstal said today it sees “slight signs of recovery” this year.
Fourth-quarter results were hurt by a weak global economy and the lower steel demand typically experienced in Russia in the local winter, Mordashov, also the company’s chief executive officer, said in the statement.
“We believe that we could see some improvement over 2013 in steel, iron ore, coking coal demand,” he said. Global steel market growth may be 2 percent to 3 percent, Mordashov said on a conference call.
Severstal’s Vorkuta coal mine was hit by a blast last month that killed 19 employees. The company expects mining at the site to be fully restored within three to four months, Mordashov said on the call. The incident will cut 200,000 to 300,000 metric tons of output this year, which will be made up from stockpiles at other mines, he said.
Severstal rose 0.7 percent to 332.60 rubles by 2:39 p.m. in Moscow, valuing the company at 278 billion rubles ($9 billion).
Full-year sales in 2012 dropped 11 percent to $14.1 billion, Ebitda fell 41 percent to $2.12 billion and net income slid 63 percent to $762 million, Severstal said.
To contact the reporter on this story: Yuliya Fedorinova in Moscow at firstname.lastname@example.org
To contact the editor responsible for this story: John Viljoen at email@example.com