PJSC Magnitogorsk Iron & Steel Works booked a net profit of US$297 million in the second quarter, a 23.2% improvement compared to US$241 million in the first quarter but a 9.7% decline compared to the second quarter of the previous year.
The company's second-quarter profit was positively impacted by the US$149 million generated by restoring reserves created for the depreciation of construction work in progress, it said in a press release dated Aug. 7.
MMK's second-quarter revenue of US$1.93 billion, meanwhile, was a 16.0% increase from the first quarter. The quarter-over-quarter increase is due to an increase in sales volumes and decrease of stocks on traders' warehouses, alongside a stronger Russian ruble to the U.S. dollar.
For the first half, the company reported a net profit of US$538 million, a 10.7% improvement from the corresponding period of 2016, on the back of 37.8% higher revenue of US$3.59 billion.
MMK also reported capital expenditure of US$163 million in the second quarter, growing from the previous quarter due to the scheduled implementation of investment projects and partially due to the stronger exchange rate between the Russian ruble and U.S. dollar. For the first half, the group invested US$284 million in fixed assets.
The company also noted that it paid dividends worth US$242 million in June for performance in the second half of 2016. The total amount of dividends paid for 2016 increased to US$369 million, which is over 50% of MMK's free cash flow for the year.
MMK previously reported improvements in crude steel output and steel product shipments in the second quarter, compared to the first quarter.