REVIEW
BUSINESS
MODEL
ASKED QUESTIONS
EVRAZ is a global steel and mining company, the leading producer of infrastructure steel products with low-cost production along the value chain.
A LEADER
in construction and railway product markets in Russia.
No. 1 PRODUCER
of rails and large diameter pipes in North America
THE LARGEST
coking coal producer in Russia
In 2018, EVRAZ delivered robust growth amid favourable market conditions and as a result of continuing initiatives to improve efficiency and reduce costs. The Group generated EBITDA of US$3,777 million during the reporting period, its highest level since 2008, which made it possible to pay dividends of US$1.6 billion. EVRAZ remained focused on implementing its efficiency improvement programme in the amount of 3% of the cost base, the effect from which totalled US$340 million in 2018. Shareholders’ appreciation of these results is evidenced by the rise in the Group’s average market capitalisation to US$9.2 billion in 2018, an 197% increase from that in 2017.
2018 was a robust year for the business reinforced by strong global metals markets, EVRAZ efficiency initiatives and diligent strategic efforts.
For the Board of Directors, 2018 was an important year with key initiatives implemented across the Group. These include a major new drive in the area of Health, Safety and Environment to strengthen the safety culture, adherence to new UK corporate governance code, implementation of the new dividend policy and much more. It was a busy agenda for the Board, and much was achieved.
EVRAZ consolidated EBITDA improved amid higher vanadium and steel product prices, lower expenses in US dollar terms as well as the impact of cost-cutting initiatives on efficiency.
As part of its leadership drive, EVRAZ is implementing its strategy based on five success factors.
At EVRAZ, we take immense pride in our leading positions in construction steel and coking coal in Russia. Globally, we are first in rails and second in vanadium.
In 2018, management carried out a robust reassessment of the principal risks facing the Group. The Audit Committee has carefully reviewed this assessment on behalf of the Board.
The assessment focused on the risks that could adversely affect the Group’s strategies. It included an evaluation of risks identified at the operational level and their relevance and significance for the Group, as well as a detailed assessment of some specific areas where new risks have been identified or the risk profile has changed significantly. The management also considered the speed of impact and volatility of each risk in their assessment. As a result, the principal risks have been updated.
