NEWS RELEASE
For Immediate Release - August 29, 2017
Chelyabinsk Zinc Plant Announces H1 2017 Consolidated Financial Results
Chelyabinsk, Russia - August 29, 2017 - Chelyabinsk Zinc Plant (LSE, MICEX-RTS: CHZN), Russia's largest producer of zinc and zinc alloys, is pleased to announce its IFRS financial results for the six months ended June 30, 2017.
H1 2017 HIGHLIGHTS
Chelyabinsk Zinc Plant's (CZP) revenue totalled RUB 18,090 mln.
EBITDA amounted to RUB 4,356 mln or 24% of revenue.
Net profit was RUB 2,975 mln or 16% of revenue.
Consolidated financial results
| (in millions of Russian Roubles) | H1 2017 | H1 2016 | Change, % |
| Revenue | 18,090 | 12,531 | 44% |
| Gross profit | 4,826 | 3,649 | 32% |
| Gross margin, % | 27% | 29% | |
| EBITDA(1) | 4,356 | 2,792 | 56% |
| EBITDA margin, % | 24% | 22% | |
| Profit before income tax | 3,770 | 2,295 | 64% |
| Net profit | 2,975 | 1,855 | 60% |
| Net margin, % | 16% | 15% |
(1) EBITDA, for any relevant period, represents operating profit before interest, income tax, depreciation and amortization.
EBITDA is not a measurement of CZP's operating performance presented in the financial information, prepared in accordance with IFRS, and should not be considered as an alternative to operating profit or any other performance measure derived in accordance with IFRS or other relevant financial framework.
Revenue
H1 2017 consolidated revenue increased by 44% to RUB 18,090 mln as compared to H1 2016.
The average LME zinc price in H1 2017 increased by 50% as compared to the relevant period of the previous year and amounted to US$2,690 / tonne. The average LME lead quotes increased by 28% to US$2,221 / tonne. The growth of zinc sales volume and increase of average LME zinc quotations had a positive effect on the proceeds from the sale of zinc. The increase of other revenue was the result of by-products sales growth.
Revenue structure
In H1 2017, revenue of CZP increased by 50% as compared to the H1 2016 and amounted to RUB 13,811 mln (H1 2016: RUB 9,233 mln). The increase of revenue was due to growth of zinc sales volume and increase of average LME zinc quotations.
Revenue of the Brock Metal Company Limited for H1 2017 amounted to RUB 3,885 mln, 31% higher than for H1 2016 (RUB 2,957 mln).
Revenue of Nova Zinc for lead concentrate sales in H1 2017 increased by 16% compared to H1 2016 and amounted to RUB 394 mln (H1 2016: RUB 340 mln). The increase was due to growth of lead concentrate sales volume and increase of average LME lead quotations.
Net profit
Net profit for H1 2017 totalled RUB 2,975 mln comparing to RUB 1,855 mln for H1 2016. The main factors of net income increase were zinc and zinc alloys domestic sales volume increase and the growth of average LME zinc quotations.
About Chelyabinsk Zinc Plant
Chelyabinsk Zinc Plant is the leading Russian zinc producer. In 2016 the plant produced 174,803 tonnes of salable SHG zinc.
According to consolidated IFRS accounts, revenue in 2016 was RUB 30,347 mln and EBITDA was RUB 6,964 mln.
CZP ordinary shares are traded on the Moscow exchange under ticker CHZN and Global Depository Receipts (GDR) are traded on the London Stock Exchange under ticker CHZN.
Investor and Media Contacts:
Natalya Vasilieva, PR, ngv@zinc.ru
Tel: +7 (351) 799-01-52
This announcement may include forward-looking statements. CZP's actual results may differ materially from those made in or suggested by the forward-looking statements contained in this announcement. By their nature, forwarding-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. Forward-looking statements are not guarantees of future performance. Even if the actual results are consistent with the forward-looking statements contained in this announcement, those results may not be indicative of results or developments in future periods. CZP does not undertake any obligation to update any forward-looking statements to reflect events that occur or circumstances that arise after the date of this announcement.
