MDA Q4&12M 2020 Release
MDA Q4&12M 2020 Presentation
IFRS Q4&12M 2020 Consolidated statement
IFRS Q4&12M 2020 Consolidated statement_EXCEL

Moscow, 02 March 2021 – ALROSA, a global leader in diamond mining, announces its IFRS results for Q4 and 12M 2020.

• In Q4, revenue doubled q-o-q to RUB 98.6 bn (up 53% y-o-y) on the back of strong demand recovery toward year-end. For 12M, revenue came in at RUB 221.5 bn (down 7%).

• EBITDA¹ in Q4 grew to RUB 31.8 bn (up 24% q-o-q) thanks to higher diamond sales on the back of recovering demand from both the cutting and polishing industry and end consumers. 12M EBITDA stood at RUB 87.6 bn (down 18%).

• EBITDA margin in Q4 amounted to 32% (Q4’19: 46%) on higher sales of small diamonds. For 12M, the margin was 40% (45% in 2019).

• Net profit in Q4 increased to RUB 21.3 bn (up 2.8x q-o-q), driven by top line growth. For 12M, net profit stood at RUB 32.2 bn (down 49%) amid lower revenue coupled with the negative impact of the FX rate in the wake of rouble depreciation.

• Free cash flow (FCF) in Q4 grew 2.9x to RUB 65.2 bn as a result of operating cash flow going up to RUB 69.6 bn. In H2’20, FCF was at RUB 87.8 bn, and in 12M it expanded to RUB 79.5 bn (up RUB 31.9 bn).

• In Q4, capex decreased to RUB 4.4 bn (down 18% q-o-q and 36% y-o-y). 12M Capex totalled RUB 17 bn.

• Net debt / LTM EBITDA as at the end of Q4’20 went down to 0.4x (Q3’20: 1.25õ).

• 2021 outlook:

  • Production – 31.5 m cts;

  • Capex – ca. RUB 25 bn (vs the previous guidance of RUB 29 bn).

Alexey Philippovskiy, ALROSA’s CFO:

“In Q4, we saw a continued recovery in demand for diamonds primarily driven by steady demand for diamond jewelry from end consumers. At the end of 2020 and during the Christmas holiday season, sales in the key US and China markets were growing at double-digit rates y-o-y.

ALROSA’s Q4 sales in totalled 17 m cts, 3.4x up q-o-q and 2.1x up y-o-y. This boosted the Company’s financials: our revenue nearly doubled to RUB 99 bn, with EBITDA reaching RUB 32 bn. Given the increase in operating cash flow, reduction in capex, as well as diamond inventories going down from 30.6 m cts at the end of Q3 to 20.7 m cts at the year-end, our FCF amounted to RUB 65 bn and RUB 88 bn for Q4 and H2’20 respectively.

The recovery of sales allowed the Company to begin intensive deleveraging efforts in Q4, which included an early repayment of two bank loans in the total amount of $275 m and a scheduled redemption of the remaining $494 m Eurobond placed in 2010 with a coupon rate of 7.75% per annum. ALROSA’s leverage (Net Debt / EBITDA) as at the end of the year decreased to 0.4 (Q3: 1.25).”

¹ EBITDA stands for the Group’s earnings or loss for the period adjusted for income tax expenses, financial income and expenses, share of net profit of associates and joint ventures, depreciation and amortisation, impairment and disposals of property, plant and equipment, gain or loss on disposal of joint ventures, revaluation of investments, and one-off items.

²FCF (free cash flow) is the operating cash flow calculated in accordance with the International Financial Reporting Standards (IFRS), net of capital expenditure (posted as Purchase of Property, Plant and Equipment on the consolidated IFRS statement of cash flows).

³Net debt is the amount of debt less cash and cash equivalents and bank deposits at each reporting date in accordance with the IFRS.