Cookie & Privacy Policy

This site uses cookies. By continuing to browse the site you are agreeing to our use of cookies. View the privacy policy to find out more here.

Kallanish Kallanish

Knowledge matters Knowledge matters

August, 5th 2020

Free Trial Buy Subscription
AUG 13

Kardemir bar/rod sales recover, higher costs slash profit


Kardemir reported a 5% on-year increase in primary product sales in the first half of 2019 to 1.19 million tonnes, despite a -3% drop in liquid steel output to 1.16mt, Kallanish notes.

Billet shipments increased 13% to 501,000t, profile deliveries surged 68% to 239,000t and bar and wire rod sales rose 6% to 186,000t. The latter recovered from a -2% decline after the first quarter. Round bar sales, however, dropped -13% to 241,000t and rail sales fell -80% to 14,000t. The average sales price of billet fell to $452/tonne in the June quarter from $486/t in the year-earlier period and wire rod was down to $518/t from $564/t.

Revenue surged 28% in H1 to TRY 3.28 billion ($585.5 million), but net profit plunged -61% to TRY 170m due to much higher cost of sales. Ebitda margin fell to 13.9% from 33%. Ebitda per tonne did, however, improve to $75/t in the second quarter from $62/t in Q1. Scrap accounted for 15% of H1 raw materials costs versus 13% in H1 2018, with iron ore comprising 34% versus 36%.

Kardemir utilised 66.2% of its 3.5 million t/year liquid steel capacity in H1 versus 68.6% a year earlier, while 2.85m t/y continuous casting capacity utilisation was down to 79.9% from 82.6%. The 831,600 t/y rebar and rod mill utilisation rose to 43.7% from 39.4%, but the 700,000 t/y continuous rolling mill utilisation fell to 68.7% from 81%. The 450,000 t/y rail mill utilisation rose to 94.1% from 90.3%.