2.1. Description of the event (action) that in Issuer’s opinion significantly influence the cost or quotation of its securities:
Disclosure of information submitted by the Issuer to the authority (organization) controlling foreign securities market, foreign trade organizer and (or) other organization in accordance with the Foreign Law for its disclosure or submission to foreign investors: press release:
Severstal announces 2022 capital investment programme
February 18, 2022, Moscow - Severstal plans to invest $1,600 mln in 2022, focusing on a key areas of the Company's strategy, namely, excellent customer experience, cost leadership and new opportunities. It implies с. 38% yoy growth comparing to 2021 (CAPEX in 2021 was $1,157 mln).
Thus, new Severstal’s 2022 capital investment programme includes:
· $878 mln to be invested in various development projects (including $336 mln to projects that will also improve environmental and climate protection performance);
· $356 mln in maintenance;
· $151 mln in capital overburden;
· $137 mln will be allocated to investments in IT and digital projects, including completion of SAP S/4 HANA project, the automation of supply chain operations and production process as well as to a wide list of IT projects aimed at quality improvement;
· $78 mln will be spent to industrial safety system improvements such as reconstruction of the fire safety system in the hot-rolling shop in line with the requirements of the best available technologies; and ecology and environmental projects such as water treatment, automatic atmospheric emissions monitoring; installation of electrofilters in sinter and crude steel production;
We increased our guidance for total investments in 2022 comparing to last forecast published at the Capital Markets Day by $300 mln. Main factors of growth:
· -$101 mln: Vorkutaugol disposal
· +$150 mln: new projects;
· +$115 mln: unspent CAPEX planned to 2021, reallocated to 2022 financial year;
· +$27 mln: partially rescheduling of preparatory works for BF5 modernization;
· +$20 mln: increase in capital overburden.
· +$89 mln: costs increase for previously guided projects due to inflation and other factors
More details will be published at our Capital Markets in June 2022.
All of these amounts are subject to adjustments dependent on FX changes. The majority of the Company’s expenditure in 2022 will be in rubles.
Russian Steel division
Investments in Severstal’s Russian Steel division in 2022 will totally amount to $1,123 mln: $675 mln will be allocated to development projects and $246 mln to maintenance. The most important projects are redesigned 13 mln tonnes crude steel capacities project with new technical solutions, long mill 170, 100 MW combined heat and power plant with electric air-blowing station, modernization of crude benzol rectification department, technical modernization of Hot-dip aluminizing continuous line, as well as preparatory works for BF5 modernization.
Investments in 2022 will amount to $503 mln: $203 mln of which will be used to develop production. One of the most important development projects will be the main phase of construction of the Cyclic-flow technology complex at Karelsky Okatysh, development of the Pechegubsky field at the Olkon, Yakovlevsky mine and Karelsky Okatysh ramp up.
Alexey Kulichenko, CFO of Severstal, commented:
“We continue to implement our large-scale transformation programme, to ensure our global leadership in the cost of production, create a unique solutions for our customers and improve quality of our products. CAPEX programme 2022 includes very important development projects that will help us to increase our steel production volumes and strengthen Severstal’s position in a global market. As a result of continuous monitoring of new opportunities we added some new projects which will help us to increase steel production volumes and improve our environmental performance.”
For further information, please contact:
Vladimir Zaluzhsky, Nikita Klimantov
T: +7 (495) 926-77-66
T: +7 (495) 926-77-66
2.2. In case if the event (action) is related to the third person – full business name (for commercial organization) or name (for non-commercial organization), location, tax identification number (INN) (if applicable), main state registration number (OGRN) (if applicable) or surname, name patronymic name (if applicable) of specified person: not applicable.
2.3. In case if the event (action) is related to the resolution taken by the authorized management body (authorized official) of the Issuer or the third person – name of the authorized management body (authorized official), date and content of the taken resolution, if the resolution taken by the collegial management body of the Issuer or the third person – also date and number of the Minutes of the meeting of the authorized collegial management body of the Issuer or the third person: not applicable.
2.4. In case if the event (action) may significantly influence the cost or quotation of its securities – type, category (class), series (if applicable) and other identification features of the Issuer’s securities specified in Securities Issue Resolution, and also registration number of securities issue (additional securities issue) and date of its registration: ordinary registered non-documentary shares (state registration number of the securities issue 1-02-00143-А, dated of state registration 30.11.2004; International Securities Identification Code (Number) (ISIN): RU0009046510), Global Depository Receipts (ISIN: US8181503025).
2.5. Date of event (action), and if the event (action) related to the third person (action is performed by the third person) the date when the Issuer has learnt or should have learnt about the event (action): February 18, 2022.
Date of information submission or presentation by the Issuer to an appropriate authority (organization) of a foreign state, foreign stock exchange and (or) other organization under the Foreign Law for its disclosure or submission to foreign investors: February 18, 2022.