Metals and Mining
November 29, 2013
Metinvest unveiled a solid set of 1H13 earnings yesterday, with EBITDA and net income improving by 14% and 31% YoY, respectively. Metinvest’s 2015 and 2018 Eurobonds both currently trade at a spread near 550bps over the bonds of the group’s Russian peer Evraz; this spread was below 200bps in August. In our view, the sharply expanded spread is due to Moody’s September downgrade of the Ukrainian sovereign, and is not related to the business profile of Metinvest. The group reported a 1H13 EBITDA margin of 19% (vs. Evraz’s 13%) and a Total Debt/12M EBITDA ratio of 1.8x (vs. 4.6x for Evraz).
