Severstal’s reports 90% fall in Q1 profit

Moscow: Severstal, Russia’s second-biggest steel producer, said on Monday profit would be flat in the second quarter of 2013 as it reported a 90 per cent year-on-year fall in first-quarter net earnings.

Like steelmakers around the world, the company has been struggling to cope with weak prices as a growth slowdown in China and Europe’s debt crisis hit demand from the construction sector and other parts of industry.

Severstal, controlled by billionaire Alexei Mordashov, posted quarterly net profit of $44 million, undershooting average analyst forecasts of $69 million.

“The global economic environment remains uncertain and this impacts our markets. Overall we expect our (second quarter) ... 2013 results to be broadly similar to our Q1 2013 numbers,” Mordashov said in a statement.

The company said earnings before interest, tax, depreciation and amortisation (Ebitda) fell 25 per cent year-on-year to $425 million in the quarter, while revenue was down 10 per cent at $3.32 billion.