EVRAZ plc

EVRAZ reported 2020 EBITDA of $2.2 billion, down from $2.6 billion in 2019. Free cash flow was reported as $1.0 billion in the prepared remarks and $1.20 billion in the financial review, and the company said 2020 dividends totaled $872 million, including an interim dividend of about $437 million or $0.30 per share approved for payment on April 7, 2021. Net debt ended 2020 at $3.356 billion, down $89 million year over year, and net debt/EBITDA was 1.5x. For 2021, management guided CapEx to around $1 billion, including about $200 million for EVRAZ Pueblo, and said the company expects to run full capacity in Russia while remaining cautious on the market outlook.

Alexander Frolov struck a cautiously positive tone, saying EVRAZ benefited from second-half market improvement after COVID-driven pressure in the first half. He emphasized the company’s strategic priorities: maintaining a low-cost position, broadening the product portfolio and customer base, and keeping CapEx and debt disciplined while paying stable dividends. On 2021, he said the company is focused on safety, customer focus, operational efficiency, and progress on key rail investments in North America and Nizhny Tagil.

Nikolay Ivanov highlighted that lower steel, vanadium, and coal prices, plus weaker North American sales, drove the EBITDA decline to $2.2 billion from $2.6 billion. He said steel revenue fell 14.4% to almost $7 billion, North America revenue fell 28.8% to $1.8 billion, and coal revenue fell 26.3% to $1.5 billion. He also pointed to robust free cash flow of $1.20 billion, cash of more than $1.6 billion at year-end, short-term debt of just over $1 billion, and net debt reduction to $3.356 billion, while noting the company had already drawn on some credit lines to manage 2021 maturities.

Analysts focused on the U.S. Section 232 slab tax refund, dividend policy, coal asset strategy, Eurobond refinancing, Russian steel demand, coal benchmarks, and North American plant utilization. Management said the North American division had filed a claim for partial tax refund, but it was too early to know the outcome; on dividends, Frolov said the Board stayed cautious because the market is positive but uncertain and CapEx will be high. On coal, management said it has a mandate to develop a strategy for coal assets and that a spin-off or sale has not been decided, while on debt it said roughly $992 million comes due in the first quarter of 2021 and the company has several refinancing options. Management also said Russian steel demand in 2021 looks close to a recovery, coal shipments to the Far East are constrained by rail capacity, and North American markets are improving with Q2 Canada fully booked.