Annual Report & Accounts 2013
Severstal Annual Report 2013 Home > Strategy > Case 3 – Flexibility of sales with sizable export revenues

Case 3 – Flexibility of sales with sizable export revenues

Being close to the Russian regions with the highest steel consumption in the country, Severstal is better located than the majority of its local peers in terms of export ports. This allows us to have “an export alternative” (i.e. the choice either to sell our products domestically or to export them, depending on the price difference), which enables us to generate earnings on our sales that are somewhat higher than the market average.

Severstal Russian Steel FY 2013 revenue breakdown by region

Flexibility of Severstal Russian Steel’s sales routes

Severstal has large mining assets which form the basis of Severstal’s vertically integrated business model. Our mining satisfies almost all our iron ore and hard coking coal requirements, while we also sell increasing volumes to third parties both in Russia and beyond.

Severstal Resources FY 2013 revenue breakdown by region

CEO statement

Our strategic goal remains the same: we aim to be a leader in value creation. In the current volatile and challenging market environment, this means the ability to generate solid positive free cash flow throughout the market cycle.

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Chairman statement

Since listing we have been committed to the highest standards of corporate Governance and aim for full compliance with the UK Corporate Governance Code.

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COO statement

We have three simple operational priorities: to have low-cost production across all of our operations at all times; to increase our share of high-margin products; and to ensure that all our assets have low CAPEX requirements.

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CFO statement

Reflecting the confidence in the outlook and the financial strength of the company, the Board of Directors has recommended a dividend payment of 3.83 roubles per share and per GDR (approximately US$0.11) for the 12 months ended 31 December 2013.

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