NLMK USA Q4 Earnings Pushed Higher by Historic Prices

NLMK USA’s profits grew as revenue surged to $1.1 billion in the fourth quarter, up 5% from $1.04 billion in the third quarter and more than four-times higher than the $248 million in the fourth quarter of the prior year, according to earnings data released on Wednesday, Feb. 2.

For the year, sales in the region rose by 27% to 2.0 million tons and revenue tripled to $3.2 billion, thanks in part to higher sales accentuated by record-high steel product prices, as U.S. demand recovered, the company said.

Demand should continue to normalize, and consumer activity is expected to wane, bringing prices down further, the steelmaker said, especially due to the introduction of a duty-free quota system for steel imports between the EU and the U.S.

The strong results by NLMK’s U.S. division were shared across NLMK Group’s global operations.

“In Q4 2021, we saw steel demand normalize on the U.S. and European markets, accompanied by growing stocks,” said Shamil Kurmashov, NLMK Group’s CFO. “This caused a slowdown in consumer activity and, consequently, a reduction in steel prices. The decrease of internal and export prices in China amid low demand in the construction segment also contributed to the downward price trend.”

NLMK USA operates an EAF steel mill in Portage, Ind., a hot strip mill and cold reduction mill in Farrell, Pa., and a coating facility in Sharon, Pa.

In total, the NLMK Group recorded profits of $1.3 billion in the fourth quarter, more than doubling Q4 2020 results. For the year, net profits ballooned more than four-fold to $5.0 billion.

By David Schollaert, David@SteelMarketUpdate.com