CMC Poland grew steel shipments 18% on-year in the third fiscal quarter through May (FQ3) to 476,000 short tons. Merchant and other deliveries were up 16% to 306,000st and rebar shipments up 21% to 170,000st, Kallanish notes.
Average selling price was up 46% to $967/short ton. Cost of ferrous scrap utilised was up 41% to $530/st and steel products margin was up 52% to $437/st. Net sales surged 71% to $484.6 million and adjusted Ebitda was up 142% to another record $121m, supported by higher magins.
Underlying demand for steel products remained robust. Volumes of rebar, merchant bar, and wire rod increased on a year-over-year basis, assisted by the addition of a third rolling line, which improved production flexibility and the mill’s ability to capitalise on favourable market conditions, says US parent CMC. During the first 12 months of operating the new rolling line, quarterly shipment volumes of finished products have increased 35% compared to the average of the preceding five years.
Energy costs in the Europe segment increased on-year in FQ3, but were more than offset by strong market dynamics.
Europe volumes should remain supported in the August quarter by a robust construction market, CMC adds.
In the nine months through May, steel shipments rose 12% on-year to 1.29 million st, with merchant and other products up 5% to 846,000st and rebar up 28% to 445,000st. Net sales surged 78% to $1.21 billion and Ebitda rose 3.5-fold to $281.96m.
Geopolitical events have caused a significant shift in steel trade flows into Europe, CMC points out. Sanctions have resulted in an absence of Russian and Belarussian steel in the EU market, while Turkey, as the natural alternative, is not geographically well-situated to supply Eastern Europe, it adds. CMC Poland has capitalised on this situation using its new rolling mill.
Adam Smith Poland