"Another resilient performance" says Mordashov of Severstal's Q4 results

He said that the company had made a number of structural and organisational changes to reduce costs and enhance efficiency and was delivering results 'despite the ongoing challenging conditions in global steel and steel-related commodities markets'.

Severstal's Q4 revenue of $3.38 billion were 6% up on Q3's 3.19 billion and profits from operations were up 12.1% at $411 million compared with $347 million for Q3. EBITDA was up 12.5% at $611 million from $543 millon in Q3.

Severstal claims that throughout 2013 it 'kept on' decreasing gross debt, finishing the year with gross debt of $4.75 billion, 4.5% lower than at the end of Q3 and 16.7% down on the end-of-year figure for 2012. The company effectively lowered its gross debt over the last year by almost $1 billion.

As Mordashov pointed out, Severstal managed to 'consistently improve its earnings performance throughout the course of the year'.

Severstal's steel divisions – Severstal Russian Steel and Severstal International – delivered increased earnings and profitability despite weaker realised prices and throughout last year continued to focus on lowering production costs at its mining operations. The company's coking coal operations at Vorkuta increased sales despite a competitive and challenging market, Mordashov said.

Capital expenditure was down 18.6% at $1.17 billion. The company launched the new Coke Battery 7 and completed the first stage of modernisation and expansion of the Pechorskaya Preparation Plant in Vorkuta.

"We have almost completed construction of the Balakovo mini-mill and of an inclined shaft at the Vorgashorskaya mine also in Vorkuta," said Mordashov, adding that production capacities were being expanded at the company's newly launched service centre near St. Petersburg, which supplies automotive, white goods and small machinery markets.

Severstal's 2014 capital expenditure target of $976 million is 17% lower year-on-year and will include the launch of the Balakovo mini-mill, revamping of the Cherepovets cold rolling mill and the completion of the service centre near St Petersburg. It will also embrace the continuing reconstruction and modernisation of the Orel steel plant, which is part of Severstal Steel Solutions.

At Severstal Resources, 2014 plans include the operational consolidation of the Vorkuta Zapolyarnaya and Vorkutinskaya mines and the construction of an inclined shaft at Zapolyarnaya, not forgetting the construction of a new water rotation unit and enhancing stripping works at Karelsky Okatysh.