6 November 2014

NLMK Group becomes preferred supplier of transformer steel for Alstom

NLMK Group becomes preferred supplier of transformer steel for Alstom
NLMK Group, Russia’s leading manufacturer of high-value added steel products, received the status of preferred category A supplier of transformer steel by the Alstom international group.

The highest category (category A) was allocated following the results of a production audit performed at the Lipetsk production site and at VIZ-Steel in Yekaterinburg by experts of the company which is a global leader in energy machine-building.

Alstom representatives examined the production processes; magnetic testing labs; sales and logistic services; and other departments of the production sites.

Ilya Guschin, NLMK Vice President for Sales, said:

“NLMK Group is the only manufacturer of transformer steel in Russia. The company’s share in the Russian market for this type of high-tech product is 99%; and approximately 9% in the global market. Alstom auditors remarked on the high quality of NLMK Group companies in terms of technology, equipment, and production control throughout the cycle. The fact that we were recognized as a top category supplier serves as yet another confirmation of the effectiveness of our work as part of Strategy 2017, aimed at increasing the share of high value added products in our output.”

Transformer (grain-oriented) steel is used in the electrical engineering industry to manufacture the cores of transformers and the immobile parts of electric machines. NLMK Group’s transformer steel production capacities are located in Lipetsk (100,000 tonnes per year) and Yekaterinburg (170,000 tonnes per year).

In 2013, NLMK Group’s export sales of transformer steel totaled 82% (194,000 tonnes) of the total production output. In 2013, Novolipetsk and VIZ-Steel sold a total of 236,000 tonnes of transformer steel.

About Novolipetsk (NLMK’s main production site in Lipetsk)

Novolipetsk is the main production site of NLMK Group, Russia’s leading manufacturer of steel and high value added rolled products, and one of the most efficient steelmaking companies in the world. Novolipetsk is the nucleus of NLMK Group’s single production chain, with assets in Russia, the EU and the USA.

Currently, steel production volume of the Lipetsk site is in excess of 12 million tonnes per year, or approximately 18% of all steel produced in Russia, and approximately 80% of all steel products produced by NLMK Group.

Novolipetsk’s high-quality steel products are used in various strategically important industries, from construction and machine-building to the production of energy equipment and large-diameter pipes.

About VIZ-Steel

VIZ-Steel is Russia’s largest transformer steel manufacturer. VIZ-Steel’s capacities allow it to manufacture up to 170,000 tonnes of transformer steel per year.

The high-quality of VIZ-Steel products is ensured by stable production technology; the use of technical and scientific innovations; modern equipment; and highly-qualified personnel. Innovative technical solutions developed by VIZ-Steel ensure continuous on-stream control over the magnetic properties of grain-oriented steel which guarantees their stability.

About NLMK Group

NLMK Group is one of the leading steelmakers in the world, and the largest steel producer in Russia.

NLMK’s production facilities are located in Russia, Europe and the USA. The Company’s crude steel capacity is over 17 million tonnes per year, of which approximately 16 million tonnes are located in Russia. NLMK has modern production capacities that are on par with leading international manufacturers in terms of technology.

The Group’s vertical integration allows for control of the entire production chain, from mining to final processing and delivery to our customers.

The Group produces a wide range of flat and long steel products. NLMK is the world-leading supplier of slabs and transformer steel, and the largest Russian supplier of HVA products, including pre-painted steel, galvanized steel and electrical steel, as well as long products.

The Company has a diversified sales topography, delivering products to over 70 countries around the world.

NLMK has the most competitive cash cost among global manufacturers; and one of the highest profitability levels in the sector. The Company generated $10.9 billion in revenue and $1.5 billion in EBITDA in 2013.

NLMK is the only steelmaker in Russia with an investment grade credit rating from international rating agencies. It is included in the TOP10 for corporate governance and transparency among Russian public companies by international rating companies.

NLMK’s ordinary shares are traded on the Moscow Stock Exchange (ticker “NLMK”) and its global depositary shares on the London Stock Exchange (ticker “NLMK:LI”).