pin-symbols pin-hamburger pin-q pin-chat pin-circle pin-double-circle pin-factory pin-big-factory

28 January 2015

Novolipetsk delivers all-time high output

Novolipetsk, NLMK Group’s main production site in Lipetsk, produced 12.56 million tonnes in 2014. This represents an all-time high over the 80 years of NLMK’s history. This record performance was supported by productivity improvements throughout the value chain of the site.

Steelmaking operations run rates topped 100% driving a 1.3% growth in output. The all-time record set in Q4 2014was 3.4 million tonnes of steel output; a 6.4% increase on the output during Q4 2013.

Sergey Filatov, Novolipetsk Managing Director, said:

“Increases in the plant’s output in the previous years were driven largely by capex on expansion and modernization of the production facilities. In the last 14 years, NLMK has had a technological break-through: we have modernized our facilities through adoption of new technological solutions that have expanded our production capacity by over 50%. These new technologies and the subsequent increased scale of operations have brought us to the next stage of development; boosting process efficiency and productivity improvements using our internal resources. Our record output and the significant reduction of costs in 2014 is evidence of the progress we have achieved. As we move forward and roll out this program through the value chain we will become the most efficient steel manufacturer in the world and further consolidate our leadership positions in the global steel industry.”

Key highlights of the record results achieved in 2014 throughout the value chain:

Sintering operations: Record output achieved since the launch of the sinter plant in 1964. In 2014, skip sinter output increased to 13.77 million tonnes (+2.5% year-on-year) driven by a series of efficiency initiatives; use of advanced technological process control methods; and productivity improvements of the equipment.

Coke-chemical operations: Record performance in optimizing raw material consumption was achieved, with dry coal charge consumption per tonne of dry bulk coke reaching a record low of 1317 kg per tonne.

Blast furnace operations: Productivity of all blast furnaces was increased as a result of improved pig iron smelting technology; mastering pulverized coal injection; and increased operational efficiency. Daily output increased by 2.3% year-on-year to reach an average of 36,000 tonnes of pig iron. Average daily production of Blast Furnace #7, the most modern BF in Russia, increased by 15.1% to 11,900 tonnes per day. As a result of projects aimed at improving resource use efficiency, metallurgical coke consumption in blast furnace operations in 2014 was reduced to 428 kg/t of pig iron (-17 kg/t year-on-year).

Steelmaking operations: The highest productivity over the entire history of BOF operations at the Lipetsk site was achieved. 12.56 million tonnes of steel (+1.3% year-on-year) was produced in 2014. Output of slabs with special dimensions featuring superior chemical composition, the bulk of which is supplied to the domestic market for the production of large diameter pipes, increased by 30% to 850,000 tonnes.

Rolling operations: Finished product output spiked in 2014. Deliveries of galvanized steel increased by 1.8% to reach 0.59 million tonnes and deliveries of pre-painted steel increased by 4.4% to reach 0.51 million tonnes. Production of transformer steel with 1st choice surface quality reached a record 91.5% vs. 90.2% in 2013. Transformer steel deliveries increased by 18% to reach 92,800 tonnes. Output of top transformer steel grades totaled 98.9%, beating the previous record of 97.7% set in 2010.

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.

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 in Russia and abroad.

About NLMK Group

NLMK Group is the largest steelmaker in Russia and one of the most efficient in the world. NLMK’s high-quality metal products are used in various industries, from construction and engineering to the manufacture of power-generating equipment and offshore wind turbines.

NLMK's production assets are located in Russia, Europe, and the United States. The Company’s liquid steel production capacity is over 17 million tonnes per year, of which about 16 million tonnes are produced in Russia. The Company generated $5.4 billion in revenue, $1.1 billion in EBITDA, and $332 million in net profit in H1 2014.

NLMK’s ordinary shares are traded on the Moscow Stock Exchange (MICEX-RTS, ticker symbol: NLMK), and its global depositary shares are traded on the London Stock Exchange (ticker symbol: NLMK:LI).