The following material events took place during the period:
The Russian metals industry journal "Metallosnabzheniye I Sbyt" ("Metals Supply") published a rating of the nation's best producers and sellers of ferrous and non-ferrous metals in the 1st six months of 2002, placing MMK fourth among the top five producers of long products and 2nd among the top five flats producers.
The MMK AGM on May 17, 2002, decided on increasing the Company's authorized capital up to RUR 10,630,221,600 by increasing the shares' par value.
In the 2nd quarter MMK made payments of proceeds to holders of MMK's interest-bearing documentary bonds for a total amount of RUR 24.2 million.
Russia's largest inner waterways shipping company "Volgotanker" (city of Samara) accounting for ab.5% of the nation's oil exports, switched to steel deliveries from MMK, turning down offers from "Severstal".
June of 2002 - opening of a water park in the Company-owned Abzakovo resort.
MMK's production performance in the first half of 2002
The Company continued to step up the volume of production, meeting the targets for the first half of the year. During that period the Company produced 4,670,000 tons of sinter and 2,560,000 of coke, and smelted 4,585,000 tons of iron and 5,435,000 of steel.
Compared to the 1st half of 2001, MMK raised its production levels by:
- 4.6% for sinter
- 3.9% for coke
- 7.8% for iron
- 7.0% for steel
- 8% for steel.
The structure of commercial products has shifted towards a greater share of flats and other higher value-added products, a sign of an improving sales trend.
This shift can demonstrated by the following table:
| |
1st half of 2002 |
1st half of 2001 |
| - billets and slabs |
418.8 |
606.5 |
| - long products |
649.6 |
622.9 |
| - flats |
3 152.9 |
2 741.1 |
| - down stream products |
540.4 |
431.6 |
| Total |
4 761.6 |
4 402.2 |
57% of all steel products was produced for export.
The following financial reports of MMK were prepared according to Russian accounting standards.
BALANCE SHEET
|
| |
As of 31/12/2001 (in RUR million) |
As of 31/12/2002 (in RUR million) |
| ASSETS |
|
|
| Non-current assets |
27 830,03 |
28 533,03 |
| Current assets, including |
16 560,45 |
19 550,11 |
| Inventories |
9 416,62 |
8 548,80 |
| Receivables |
4 640,40 |
5 911,74 |
| Cash and highly liquid assets |
2 503,44 |
5 089,57 |
| TOTAL |
44 390,48 |
48 083,14 |
| LIABILITIES |
|
|
| Equity |
28 471,18 |
29 725,21 |
| Liabilities, including |
15 919,30 |
18 357,21 |
| Long-term liabilities |
2 015,72 |
7 892,77 |
| Current liabilities |
13 903,58 |
10 464,44 |
| TOTAL |
44 390,48 |
48 083,14 | |
During the accounting period the total assets of the Company grew by 8.3% against the period beginning, signaling a build-up of the Company's fixed assets. Non-current assets grew by RUR 703 million, or by 2.5%. The 18% growth of the current assets can mainly be attributed to an 11% increase of cash and highly liquid assets.
On the liabilities' side, the Company's equity increased by RUR 1.254 billion, or 4.4%, with liabilities up by RUR 2.438 billion, or 15.3%. There is a trend towards an increasing proportion of long-term liabilities, which is a positive factor for the balance sheet.
FINANCIAL RESULTS
|
| |
1st Q of 2002 (in RUR million) |
1st 6-months of 2002 (in RUR million) |
| Sales revenues |
11 682 |
25 819 |
| Cost of sales |
10 214 |
21 425 |
| Selling costs |
170 |
368 |
| Sales profit (loss) |
1 298 |
4 026 |
| Operating income and expenditures |
- 349 |
- 1 067 |
| Non-operating income and expenditures |
- 1 022 |
- 1 342 |
| Profit (loss) before tax |
- 73 |
1 617 |
| Profit and other similar taxes |
171 |
272 |
| Net profit |
- 244 |
1 345 | |
|
In the 2nd quarter of 2002 the loss incurred in the 1st quarter due to the transition, starting from 01.01.2002, to a new Chart of Accounts as ordered by Regulation # 94 of the Ministry of Finance dated 31.10.2000, and the adoption of Chapter 25 of the Russian Federation Tax Code ("Tax on an Enterprise's Profit"). The net profit for 1st 6 months of 2002 totaled RUR 1.345 billion.
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