содержание .. 1 2 3 4 ..
ЕВРАЗ. Годовой отчет за 2021 год - часть 3
Meet EVRAZ
EVRAZ in figures
STRATEGIC REPORT
Corporate governance
Financial statements
Additional information
ANNUAL REPORT & ACCOUNTS 2021
CAPEX AND KEY PROJECTS
FINANCING AND LIQUIDITY
During the reporting period, EVRAZ’ capital expenditures rose to US$920 million, compared with US$657 million in 2020, driven by higher
EVRAZ began 2021 with total debt
In the process of preparing for a potential
in 2021, all of which had high coupon rates,
development expenses. Capital expenditure projects during 2021, indicated in millions of US dollars, can be summarised as follows.
of US$4,983 million
demerger of its Coal assets, the Group
together with management’s efforts to reduce
obtained necessary creditor approvals,
total debt and refinance indebtedness
In January, the Group repaid at maturity
including a Eurobond consent solicitation
on favourable terms, led to the significant
Development Projects, US$ million
US$735 million in outstanding principal of its
from the majority of holders of its Eurobonds
reduction of interest expense compared
Eurobonds due in 2021. In June and August,
due in 2022, 2023 and 2024. It also took
with the previous year.
Steel segment
the Group completed several transactions
steps to rebalance its debt between the Steel
Tashtagol iron ore mine upgrade at EVRAZ ZSMK mining site
33
to repurchase, in aggregate, US$65 million
and Coal divisions and refinance certain
The higher EBITDA amid a strong market
The project aim is to increase the annual iron ore production of the Tashtagolsky deposit with a partial
in outstanding principal of its Eurobonds
outstanding loans.
recovery and lower net debt resulted
switch to sub-level caving using mobile equipment.
due in 2022 and later in October completed
in a significant reduction in the Group’s
Sobstvenno-Kachkanarsky deposit greenfield project
29
a make-whole call for the remaining
Raspadskaya received a US$200 million
major leverage metric, the ratio of net debt
The project aim is to maintain production of raw iron ore.
US$435 million in outstanding principal
long-term loan from Alfa Bank
to last twelve months (LTM) EBITDA, to 0.5
Rail and beam mill modernisation at EVRAZ NTMK
14
of these Eurobonds.
and a US$200 million long-term loan from
as at 31 December 2021, compared with 1.5
SberBank.
as at 31 December 2020.
The project aim is to increase production of beams and sheet piles.
In March, the Group repaid, at maturity,
Construction of Vanadium processing facility at EVRAZ Uzlovaya
13
RUB15,000 million (roughly US$201 million)
Steelmaking subsidiaries of the Group repaid
As at 31 December 2021, various bilateral
The strategic aims of the new unit are to increase cost efficiency in fully controlled and coordinated
in outstanding principal of its ruble-
a total of around US$619 million of their
facilities with a total outstanding principal
at all stages processing chain from slag to final product.
denominated bonds due in 2021.
outstanding bank debt of varying maturities
of around US$1,697 million contained financial
Transfer of direct coke oven gas for cleaning in capture shop no. 3 at EVRAZ NTMK
11
during 2021.
maintenance covenants tested at the level
The project aim is to decrease air emissions.
In March, to compensate for the reduction
of EVRAZ plc, including a maximum net
Reconstruction of pig-casting machines section for blast furnace at EVRAZ NTMK
9
in liquidity, EVRAZ drew US$750 million
As a result of these actions,
leverage and a minimum EBITDA interest
under the committed syndicated facility that
as well as scheduled repayments of bank
cover.
Technical re-equipment of the bottling section blast furnace machines.
it signed with a group of international banks
loans and leases in 2021, total debt fell
Construction of uncompressed gas recovery turbines for blast furnace no. 7 at EVRAZ NTMK
6
in early 2020.
by US$889 million to US$4,094 million
New debt facilities of Raspadskaya
The project aim is to increase own electricity generation.
as at 31 December 2021.
contain financial maintenance covenants
Steel, North America segment
In February, EVRAZ signed a new credit
tested on the consolidated financials
Long rail mill at EVRAZ Pueblo
146
facility with SberBank and borrowed
In 2021, EVRAZ paid three interim dividends
of Raspadskaya, including a maximum net
US$67 million of the available funds.
to its shareholders: US$437 million (US$0.30
leverage and a minimum EBITDA interest
The project aim is to replace the existing rail facility and meet the needs of customers for long rail products.
per share) in April, US$292 million (US$0.20
cover.
Electric arc furnace (EAF) repowering at EVRAZ Regina
7
In June, EVRAZ signed an amendment to its
per share) in June, and US$802 million
The project aim is to increase EVRAZ Regina’s prime coil and plate production and reduce electrode
existing US$100 million credit facility with ING
(US$0.55 per share) in September.
As at 31 December 2021, EVRAZ and its
consumption.
DiBa, extending its repayment schedule until
subsidiaries were in full compliance
Coal segment
2026 and increasing its size to US$150 million.
On 14 December 2021, EVRAZ announced
with the financial covenants.
Acquisition of equipment at Alardinskaya mine
17
In July, EVRAZ utilised an additional
an interim dividend to its shareholders
The project aim is to reduce the time required for transition from longwall to longwall and to increase
US$50 million. In October, the Group
of US$292 million (US$0.20 per share),
As at 31 December 2021, cash and cash
annual production volumes to 3.2mt.
agreed an amendment to this credit
payable in January 2022.
equivalents amounted to US$1,427 million,
facility implementing sustainability-linked
while short-term loans and the current
Acquisition of equipment at Raspadskaya-Koksovaya mine
12
provisions, namely a pricing mechanism
Net debt dropped by US$689 million
portion of long-term loans amounted
Equipment for open pit mining.
linked to the management score component
to US$2,667 million, compared
to US$101 million. Cash balances
Acquisition of equipment at Osinnikovskaya mine
11
of the Sustainalytics ESG rating.
with US$3,356 million as at 31 December 2020.
and committed credit facilities available
The project aim is to acquire equipment that fully complies with the mining and geological conditions
to the Group (US$623 million) comfortably
to provide the projected monthly longwall load.
In November, EVRAZ signed a new,
Interest expense accrued on loans, bonds
cover upcoming maturities.
Other development projects
95
committed US$350 million credit facility
and notes amounted to US$186 million during
MAINTENANCE CAPEX
517
with Intesa with an availability period of six
the period, compared with US$291 million
months from the signing date. The facility
in 2020. The repayment of the Eurobonds
TOTAL
920
remained unutilised as at 31 December 2021.
due in 2021 and 2022 and ruble bonds due
40
41
Meet EVRAZ
EVRAZ in figures
STRATEGIC REPORT
Corporate governance
Financial statements
Additional information
ANNUAL REPORT & ACCOUNTS 2021
Sales volumes of Steel segment, thousand tonnes
REVIEW OF OPERATIONS BY SEGMENT
2021
2020
CHANGE, %
Steel products, external sales
11,597
12,197
(4.9)
(US$ MILLION)
STEEL
STEEL, NORTH
COAL
OTHER
Semi-finished products
5,541
6,039
(8.2)
AMERICA
Construction products
3,905
3,944
(1.0)
2021
2020
2021
2020
2021
2020
2021
2020
Railway products
1,192
1,299
(8.2)
Revenues
10,188
6,969
2,324
1,779
2,321
1,490
535
410
Flat-rolled products
245
267
(8.2)
EBITDA
3,609
1,930
321
(28)
1,292
400
19
15
Other steel products
714
647
10.4
EBITDA margin
35.4%
27.7%
13.8%
(1.6)%
55.7%
26.8%
3.6%
3.7%
Steel products, intersegment sales
29
67
(56.7)
CAPEX
468
401
216
92
228
154
8
10
TOTAL STEEL PRODUCTS
11,626
12,264
(5.2)
Vanadium products (tonnes of pure vanadium)
20,341
18,696
8.8
Vanadium in slag
7,053
6,129
15.1
Vanadium in alloys and chemicals
13,288
12,567
5.7
Steel segment
Iron ore products (pellets)
1,430
1,732
(17.4)
Sales review
Geographic breakdown of external steel product sales, US$ million
Steel segment revenues by product
2021
2020
CHANGE, %
2021
2020
Russia
4,263
2,962
43.9
US$ MILLION
% OF TOTAL
US$ MILLION
% OF TOTAL
CHANGE, %
Asia
2,627
2,200
19.4
SEGMENT
SEGMENT
REVENUES
REVENUES
CIS
682
490
39.2
Steel products, external sales
8,842
86.8
6,079
87.2
45.5
Europe
596
221
n/a
Semi-finished products1
3,779
37.1
2,479
35.6
52.4
Africa, Americas and rest of the world
674
206
n/a
Construction products2
3,177
31.2
2,013
28.9
57.8
TOTAL
8,842
6,079
45.5
Railway products3
1,083
10.6
1,099
15.8
(1.5)
Flat-rolled products4
237
2.3
146
2.1
62.3
In 2021, the Steel segment’s revenues
greater beam sales prices, as well as higher
Steel segment revenues from sales of
Other steel products5
566
5.6
342
4.9
65.5
climbed by 46.2% YoY to US$10,188 million,
sales prices for channels, primarily
iron ore products, including intersegment
Steel products, intersegment sales
28
0.3
37
0.5
(24.3)
compared with US$6,969 million in 2020. This
on the Russian market.
sales, surged by 60.3%, driven by an 77.7%
was the result of higher sales prices, primarily
jump in sales prices and a 17.4% decline in
Including sales to Steel, North
8
0.1
26
0.4
(69.2)
for semi-finished products and construction
Revenues from external sales of railway
sales volumes. The main decrease in sales
America
products, as well as greater vanadium product
products decreased because of reductions
volumes was caused by a shortage of iron
Iron ore products
234
2.3
146
2.1
60.3
volumes.
of 8.2% in sales volumes, which was partly
ore, unplanned equipment downtimes and
Vanadium products
515
5.1
349
5.0
47.6
offset by a 6.7% increase in sales prices.
logistics restrictions.
Other revenues
569
5.6
358
5.1
58.9
Revenues from external sales of semi-finished
The drop in sales volumes was caused
products rose by 52.4% YoY. This was driven
mostly by lower sales of rails amid reduced
During the reporting period, around 68.1%
TOTAL
10,188
100.0
6,969
100.0
46.2
by a 60.6% increase in average prices, which
demand in Russia and the CIS.
of EVRAZ’ iron ore consumed in steelmaking
was partly offset by an 8.2% decline in sales
came from its own operations, compared
volumes. The decrease was attributable to
External revenues from flat-rolled products
with 63.2% in 2020.
change in product mix and a reduction in
surged by 62.3% YoY, driven by a 70.5%
the output following the introduction of
upswing in sales prices.
Steel segment revenues from sales
the export duty in 2021. The primary factor
of vanadium products, including
was a surge of 90.0% in the average prices
Revenues from external steel product sales
intersegment sales, climbed by 47.6%, due
of slabs.
in Russia climbed by 43.9% YoY, primarily
primarily to a 38.8% increase in sales prices.
because of higher prices and greater
Vanadium product prices followed market
Revenues from sales of construction products
demand. The share of the Russian market
trends, including the London Metal Bulletin
to third parties jumped by 57.8% YoY amid
in total external steel product sales decreased
and Ryan’s Notes benchmarks.
an increase of 58.8% in average prices. This
from 48.7% in 2020 to 48.2% in 2021. Asia’s
1. Includes billets, slabs, pig iron, pipe blanks and other semi-finished products
was caused mainly by higher sales prices
share of sales fell from 36.2% to 29.7%
2. Includes rebars, wire rods, wire, beams, channels and angles
for rebars on the Russian and CIS markets,
because of lower sales volumes for billets.
3. Includes rails, wheels, tyres and other railway products
4. Includes commodity plate and other flat-rolled products
42
5. Includes rounds, grinding balls, mine uprights and strips, and tubular products
43
Meet EVRAZ
EVRAZ in figures
STRATEGIC REPORT
Corporate governance
Financial statements
Additional information
ANNUAL REPORT & ACCOUNTS 2021
Steel segment cost of revenues
Steel, North America segment
Steel segment cost of revenues
Sales review
2021
2020
Steel, North America segment revenues by product
US$ MILLION
% OF SEGMENT
US$ MILLION
% OF SEGMENT
CHANGE, %
REVENUES
REVENUES
2021
2020
Cost of revenues
6,070
59.7
4,596
65.9
32.1
US$ MILLION
% OF TOTAL
US$ MILLION
% OF TOTAL
CHANGE, %
Raw materials
3,150
30.9
2,025
29.1
55.5
SEGMENT
SEGMENT
REVENUES
REVENUES
Iron ore
776
7.6
503
7.2
54.3
Steel products
2,227
95.8
1,684
94.7
32.2
Coking coal
1,218
12.0
769
11.0
58.4
Semi-finished products2
10
0.4
109
6.1
(90.8)
Scrap
673
6.6
442
6.3
52.3
Construction products3
268
11.5
183
10.3
46.4
Other raw materials
483
4.7
311
4.5
55.3
Railway products4
392
16.9
326
18.3
20.2
Auxiliary materials
328
3.2
339
4.9
3.2
Flat-rolled products5
900
38.7
323
18.2
178.6
Services
266
2.6
241
3.5
10.4
Tubular and other steel products6
657
28.3
743
41.8
(11.6)
Transportation
380
3.7
407
5.8
(6.6)
Other revenues7
97
4.2
95
5.6
2.1
Staff costs
518
5.1
477
6.8
8.6
TOTAL
2,324
100.0
1,779
100.0
30.6
Depreciation
256
2.5
233
3.3
9.9
Energy
416
4.1
398
5.7
4.5
Other1
756
7.4
476
6.8
58.8
Sales volumes of Steel, North America segment, thousand tonnes
2021
2020
CHANGE, %
In 2021, the Steel segment’s cost of
Transportation costs dropped by 6.6%,
Steel segment gross profit
•
revenues increased by 32.1% YoY. The main
primarily because of lower railway tariffs.
Steel products
reasons for the growth in costs were as
•
Depreciation costs increased by 9.9%,
The Steel segment’s gross profit surged
Semi-finished products
-
144
(100.0)
follows:
mainly because of higher depreciation
by 73.5% YoY and amounted to US$4,118
Construction products
268
262
2.3
The cost of raw materials rose by 55.5%,
at EVRAZ NTMK after fixed assets were
million in the reporting period driven
•
Railway products
383
404
(5.2)
primarily because of the higher cost
upgraded to improve their technical
primarily by higher prices for semi-finished,
of coking coal (up 58.4%) and iron ore
condition.
construction and vanadium products. This
Flat-rolled products
625
382
63.6
(54.3%) amid price increases. Scrap costs
•
Other costs jumped by 58.8%, largely
was partly offset by the negative effect
Tubular and other steel products
402
537
(25.1)
climbed by 52.3% because of higher
because of increase in taxes due to
of higher costs.
TOTAL
1,678
1,729
(2.9)
prices for scrap, which was driven by
export duty on metal products effective
global market trends.
from 1 August 2021 and lower cost of
•
Service costs rose by 10.4%, primarily
goods for resale amid an increase in
driven by higher costs for processing
purchase prices in 2021 compared with
The Steel, North America segment’s
Revenues from construction product
improvement and a 115.0% increase in sales
costs of vanadium in slag.
2020.
revenues from the sale of steel products
sales rose by 46.4% YoY because
prices as a result of higher third-party
climbed by 32.2% YoY amid a 35.3% surge
of a 2.3% increase in volumes and a 44.1%
demand in 2021 amid the rapid market
in sales prices, offset by a 2.9% decrease
improvement in prices. The upward trend
recovery from the pandemic and limited
in sales volumes. The reduction in volumes
was driven by greater market demand amid
supply.
was mainly attributable to sales of tubular
the economic recovery.
and semi finished products, which was
Revenues from tubular and other steel
partly compensated by increased sales of
Railway product revenues increased
product sales fell by 11.6% YoY due to a
flat-rolled and construction products.
by 20.2%, driven by a growth in sales
25.1% drop in sales volumes, which was
prices of 25.4%. This was partly offset
partly offset by an 13.5% uptick in sales
Revenues from semi-finished product
by a decrease in sales volumes of 5.2%.
prices. The reduction in volumes was
sales dropped to almost zero following
caused by the idling of the spiral mills
the fulfilment of a contract with a key
Revenues from flat-rolled products soared
following the completion of 2020 orders.
customer in 2020.
by 178.6% amid a 63.6% jump in volumes.
This was supported by rapid market
2. Includes slabs
3. Includes beams and rebars
4. Includes rails and wheels
5. Includes commodity plate, specialty plate and other flat-rolled products
6. Includes large-diameter line pipes, ERW line pipes, seamless and welded OCTG and other steel products
1. Primarily includes goods for resale, intersegment unrealised profit and certain taxes, semi-finished products and allowances for inventories
44
7. Includes scrap and services
45
Meet EVRAZ
EVRAZ in figures
STRATEGIC REPORT
Corporate governance
Financial statements
Additional information
ANNUAL REPORT & ACCOUNTS 2021
Steel, North America segment cost of revenues
Sales volumes of Coal segment, thousand tonnes
2021
2020
CHANGE, %
Steel, North America segment cost of revenues
External sales
2021
2020
Coal products
10,608
12,336
(14.0)
US$ MILLION
% OF SEGMENT
US$ MILLION
% OF SEGMENT
CHANGE, %
Coking coal
686
2,233
(69.3)
REVENUES
REVENUES
Coal concentrate and other products
9,922
10,066
(1.4)
Cost of revenues
1,835
79.0
1,604
90.1
14.4
Steam coal
37
n/a
Raw materials
888
38.2
454
25.5
95.6
Intersegment sales
Semi-finished products
137
5.9
238
13.4
(42.4)
Auxiliary materials
202
8.7
172
9.7
17.4
Coal products
6,197
6,986
(11.3)
Services
135
5.8
145
8.2
(6.9)
Coking coal
2,172
2,323
(6.5)
Staff costs
240
10.3
240
13.5
-
Coal concentrate
4,025
4,663
(13.7)
Depreciation
89
3.8
100
5.6
(11.0)
TOTAL, COAL PRODUCTS
16,805
19,322
(13.0)
Energy
119
5.1
90
5.1
32.2
Other1
25
1.1
165
9.3
(84.8)
In 2021, the Coal segment’s overall revenues
was partly offset by an 14.0% decrease in sales
by an 11.3% drop in sales volumes amid
increased as sales prices rose in line
volumes because of lower production of the
a shortage of premium K-grade coal.
In 2021, the Steel, North America segment’s
Auxiliary material costs rose by 17.4%
higher production and prices, which
with global market trends. As the global
GZh grade and a change in the product mix
•
cost of revenues increased by 14.4% YoY.
following a change in classification (lime
were driven by global market trends.
market recovered from the pandemic-
in favour of coking coal concentrate to meet
In 2021, the Coal segment’s sales to the Steel
The main drivers were as follows:
and coke to auxiliary materials, which
related decline seen in 2020, demand
customer needs. Revenues from external sales
segment amounted to US$762 million (32.8%
were previously included in other raw
for coal grew. Production restrictions
of coking coal and coking coal concentrate
of total sales), compared with US$536 million
•Raw material costs surged by 95.6%,
which was primarily attributable to the
materials).
Steel, North America segment
observed since the second half of 2021 in key
climbed by 28.4% and 68.3%, respectively,
(35.9%) in 2020.
higher cost of scrap metal and increased
Service costs fell by 6.9%, mainly driven
gross profit
global producing regions also contributed
amid higher prices.
•
consumption due to transition to increased
by decline in coating services due to
to the strong increase in international prices.
During the reporting period, roughly
share of internal supply of semi-finished
decreased pipe sales volumes.
The Steel, North America segment’s gross profit
Revenues from internal sales of coal products
70.7% of EVRAZ’ coking coal consumption
products.
Energy costs rose by 32.2%, primarily
totalled US$489 million in the reporting period,
Revenues from external sales of coal products
surged by 42.2%, mainly because of a 53.5%
in steelmaking came from the Group’s own
•
•The cost of semi-finished products
because of higher natural gas prices.
up from US$175 million in 2020. The increase
increased amid a 78.8% upswing in prices. This
jump in sales prices, which was partly offset
operations, compared with 78.0% in 2020.
dropped by 42.4% driven by a reduction
Other costs were down for the reporting
was primarily driven by a significant growth
•
of externally purchased materials and
period, mainly because of changes
in revenues amid favourable market conditions.
transition to internal supply.
in balances of finished goods and work
It was partly offset by higher prices for raw
Coal segment cost of revenues
in progress compared with 2020 amid
materials, auxiliary materials and energy.
Coal segment cost of revenues
2021
2020
Coal segment
US$ MILLION
% OF SEGMENT
US$ MILLION
% OF SEGMENT
CHANGE, %
Sales review
REVENUES
REVENUES
Cost of revenues
919
39.6
1,027
68.9
(10.5)
Coal segment revenues by product
Auxiliary materials
141
6.1
110
7.4
28.2
Services
65
2.8
53
3.5
22.6
2021
2020
Transportation
286
12.3
294
19.7
(2.7)
US$ MILLION
% OF TOTAL
US$ MILLION
% OF TOTAL
CHANGE, %
Staff costs
226
9.7
200
13.4
13.0
SEGMENT REVENUES
SEGMENT REVENUES
Depreciation
164
7.1
163
10.9
0.6
External sales
Energy
46
2.0
43
2.9
7.0
Coal products
1,531
65.9
929
62.4
64.8
Other1
(9)
(0.4)
164
11.0
(105.5)
Coking coal
95
4.1
74
4.9
28.4
Coal concentrate
1,436
61.9
853
57.3
68.3
The volume of total coal products sales
Osinnikovskaya, Erunakovskaya
and resumption of work at Razrez
Steam coal
-
-
2
0.2
(100)
decreased by 13% and caused decrease
and Raspadskaya mines.
Raspadsky.
of cost of sales by 10.5% while cost
Intersegment sales
•Costs for services climbed by 22.6%
of production increased due to increase
due to the high growth of the prices
Coal products
762
32.8
536
35.9
42.2
of production as well as the following
of contractors services in Kuzbass
Coal segment gross profit
Coking coal
184
7.9
101
6.8
82.2
factors:
region.
Coal concentrate
578
24.9
435
29.2
32.9
In 2021, the Coal segment’s gross profit
•The cost of auxiliary materials rose
•Staff costs were up because of higher
Other segment revenues
28
1.2
25
1.7
12.0
by 28.2% amid higher longwall
mining volumes accompanied
amounted to US$1,402 million, up from
move costs at the Alardinskaya,
with insourcing new equipment
US$463 million a year earlier, primarily
TOTAL
2,321
100
1,490
100.0
55.8
because of the surge in sales prices.
46
1. Primarily includes transportation, goods for resale, certain taxes, changes in work in progress and fixed goods and allowances for inventories
47
1. Primarily includes goods for resale, certain taxes, changes in work in progress and finished goods, allowance for inventory, raw materials and intersegment unrealised
profit
Meet EVRAZ
EVRAZ in figures
STRATEGIC REPORT
Corporate governance
Financial statements
Additional information
ANNUAL REPORT & ACCOUNTS 2021
BUSINESS
Production highlights
Crude steel
Iron ore products
REVIEW
11,690 kt
14,399 kt
Steel products
Vanadium slag
STEEL SEGMENT
10,763 kt
20,058 mtV
EVRAZ is the leader in the long
2
Sales highlights
RUSSIA
products and rail segments in Russia
and is the world’s largest producer
Finished products
Iron ore products
of vanadium, with a global market
EVRAZ
6,056 kt
1,430 kt
share of 14%. The Steel segment’s
KGOK
EVRAZ
Semi-finished products
Vanadium final products
primary focus is producing steel in
NTMK
the CIS from nearby raw materials
EVRAZ
5,541 kt
13,288 mtV
Moscow
ZSMK
to serve regional infrastructure
EVRAZ
Vanady Tula
EVRAZ
and construction sectors, while
Financial highlights
Caspian Steel
EVRAZ
maintaining export flexibility. We
Nikom
CZECH
Revenues
EBITDA margin
KAZAKHSTAN
are in the first quartile of the
REPUBLIC
US$10,188 m
35.4 %
global crude steel cost curve.
EBITDA
CAPEX
US$3,609 m
US$468 m
Mining operations
Steelmaking operations
Vanadium operations
Trading companies
EVRAZ KGOK, Russia
EVRAZ ZSMK, Russia
EVRAZ NTMK, Russia
EVRAZ Vanady Tula, Russia
EVRAZ Market
EVRAZ East Metals
EVRAZ KGOK is the Group’s core mining
The largest steel producer in Siberia, EVRAZ
EVRAZ NTMK is one of the largest
EVRAZ Vanady Tula is the largest European
EVRAZ Market is a leading Russian
A Switzerland-based trading company,
asset. It is located in Urals, 140 kilometres
ZSMK is located in the city of Novokuznetsk
integrated steel production plants in
producer of vanadium pentoxide,
provider of steel for infrastructure projects
East Metals AG is EVRAZ’ sole distribution
from the primary consumer of its products,
in Kemerovo region (Kuzbass). It has five
Russia and has a full processing cycle. It
ferrovanadium-50 and ferrovanadium-80,
and a trader supplying rebar, profile, flat,
channel outside the CIS. Its main exports
EVRAZ NTMK. EVRAZ KGOK mines
coke oven batteries and three blast furnaces
is located in the city of Nizhniy Tagil in
which are alloy additions used to
tubular and rolled steel from major plants
include semi-finished steel products
titanomagnetite iron ore, which contains
in operation. For steelmaking, it has two
the Ural region. It has coke and chemical
manufacture extra-high-strength steel for
in the CIS. Its major presence in various
(slab and square billet), long finished
vanadium, meaning that it can be used to
oxygen converter shops, which have five
production facilities, two blast furnaces,
various applications and titanium alloys.
regions of Russia is supported by a branch
products (rail, beam, wire rod and rebar),
produce high-strength grades of alloy steel.
basic oxygen furnaces, and an electric arc
steelmaking units (one oxygen converter
It is located in Tula, 180 kilometres from
network that includes 48 subdivisions,
pig iron, coking coal, vanadium products
EVRAZ KGOK mines ore from three open
furnace (EAF). EVRAZ ZSMK operates one
shop consisting of four LD converters),
Moscow. The site’s production and scientific
and its branches are located in industrial
and iron ore pellets. It has a wide
pits and then processes it in its crushing,
eight-strand continuous casting machine,
four continuous casters, seven rolling
resources make it possible to process
centres across the country, as well as
network of agencies and representative
processing, sintering and pelletising plants.
which produces square billets; a two-strand
mills, and a heat and power generation
any vanadium-containing materials into a
in Kazakhstan. Each subdivision’s product
offices (including in China, Hong Kong,
The final product, in the form of sinter and
continuous slab casting machine; and one
plant.
wide range of products. EVRAZ Vanady
range is tailored to local demand. In
Indonesia, Japan, the Philippines, South
pellets, is shipped by railcar to consumers,
four-strand continuous casting machine,
Tula uses low-cost, efficient technology to
addition, it has a pool of 120 metal
Korea, Taiwan, Thailand and Turkey),
including those abroad.
which makes semi-finished products for
process vanadium slag from EVRAZ NTMK.
processing machines, which enables it to
which ensures proximity to clients in key
EVRAZ Caspian Steel,
markets.
the rail mill. Rolling facilities include a
offer HVA products.
Kazakhstan
blooming mill, one medium-section 450
EVRAZ ZSMK mining
EVRAZ Nikom, Czech
mill, two small-section 250 mills, one rail
EVRAZ Caspian Steel is located in
operations1, Russia
and structural steel mill, one sectional mill
Republic
Trading Company EVRAZ
Kostanay, Kazakhstan. It has a light-
and two ball-rolling mills. The steel mill has
EVRAZ ZSMK include several mining and
section rolling mill.
Located 30 kilometres from Prague,
Trading Company EVRAZ is Russia’s
its own coal washing plant for coking coal
processing facilities in Siberia. Most of
EVRAZ Nikom produces ferroalloys
largest supplier of rolled steel and sells
and can also produce customised coking
the iron ore that it produces is consumed
and corundum material. It converts
EVRAZ products domestically and in
coal blends.
internally by its steelmaking operations.
the vanadium oxide produced by EVRAZ
the CIS. It focuses on products for the
It conducts underground mining, and its
Vanady Tula into ferrovanadium,
construction, engineering, transportation
mining complex includes three mines, a
the major vanadium product used
(rails, wheels and specialist products),
limestone quarry, and a concentration and
by the steel industry to increase strength
mining and pipe-making sectors.
48
sinter plant.
and hardness.
49
1. Former Evrazruda
2. Sales to third parties only.
Meet EVRAZ
EVRAZ in figures
STRATEGIC REPORT
Corporate governance
Financial statements
Additional information
ANNUAL REPORT & ACCOUNTS 2021
Production highlights
STEEL, NORTH AMERICA
Crude steel
Steel products
SEGMENT
1,879 kt
1,655 kt
EVRAZ is a leading North
Sales highlights1
CANADA
American producer of high-
quality, engineered steel for
Steel products
rail, energy and industrial end-
EVRAZ
1,678 kt
EVRAZ
user markets. The segment is the
Red Deer
Camrose
largest producer of rail and large-
EVRAZ
EVRAZ
Financial highlights
Calgary
diameter pipe (LDP) in North
Regina
America. Its operations also lead
Revenues
EBITDA margin
EVRAZ
in Western Canada’s oil country
US$2,324 m
13.8 %
Portland
tubular goods (OCTG) and small-
Chicago
EBITDA
CAPEX
diameter line pipe (SDP) markets,
USA
US$ 321 m
US$ 216 m
as well as in the US West Coast
EVRAZ
Pueblo
plate market.
Steelmaking and rolling - Canada
Steelmaking and rolling - USA
Recycling
EVRAZ Regina
EVRAZ Calgary
EVRAZ Red Deer
EVRAZ Portland
EVRAZ Pueblo
EVRAZ Recycling
Located in Saskatchewan, EVRAZ Regina is
EVRAZ Calgary has an ERW pipe mill and
EVRAZ Red Deer has an ERW pipe mill
EVRAZ Portland in Oregon has a Steckel
EVRAZ Pueblo in Colorado has three
EVRAZ Recycling is the largest metal
the largest steelmaker in Western Canada.
heat treatment, API threading and finishing
producing OCTG casing and SDP with an
rolling mill, a plate quench and tempering
rolling mills: a rail mill; a seamless pipe
scrap recycler in Western Canada, with
It operates two EAFs, a ladle furnace and
lines for OCTG casing with an external
outside diameter of up to 13 3/8 inches.
facility, and two HSAW pipe mills. The
mill that produces OCTG products for use
13 facilities across the prairies, as well as
a continuous variable-width slab caster,
diameter of up to 9 5/8 inches. The site
The site includes a casing heat treatment
rolling facility is the only plate mill on the
in oil and gas production; and a wire rod
three facilities in the US, located in North
and a Steckel mill capable of rolling coil
also operates ERW tubing finishing facilities
line, API and premium threading lines, and
West Coast and has deep-water access
and coiled reinforcing bar mill. It also
Dakota and Colorado. EVRAZ Recycling
and plate with a width of up to 72 inches.
comprising pipe upsetting, threading, testing
separate OCTG casing and SDP finishing
to the Pacific Ocean, as well as access to
operates one EAF and a billet caster that
buys, processes and sells a wide range
EVRAZ Regina produces carbon steel slabs,
and inspection. EVRAZ Calgary’s products
line.
Class I railways and trucking routes serving
supplies round billets to the hot rolling
of ferrous and nonferrous materials, while
flat-rolled discrete plate and coiled plate.
are primarily used in oil and gas exploration
North America. Finished products include
mills. In addition, EVRAZ Pueblo owns
also offering a variety of metal recycling
Its tubular operations consist of a 24-inch
and production in Canada and the US.
hot-rolled carbon and alloy steel plate, hot-
and operates the Colorado and Wyoming
and other services, including auto
EVRAZ Edmonton Coupling
Electric Resistance Welded (ERW) line pipe
rolled coil, heat-treated plate, shot-blasted
railway. This short-line route serves
wrecking yards that provide low-cost parts
mill, a 2-inch ERW pipe mill (for OCTG
Machining
and primed plate, temper-passed cut-to-
the Group’s mills and connects the site
on a self-serve basis.
welding), five helical submerged arc-welded
EVRAZ Camrose
length plate and plate coil.
to both the Burlington Northern Santa Fe
EVRAZ Edmonton Coupling Machining
(HSAW) mills and an ID/OD coating facility,
and the Union Pacific railway lines, thereby
EVRAZ Camrose operates an ERW pipe mill
specialises in manufacturing API couplings
which produces LDP for oil, natural gas and
reducing delivery costs to these customers.
and a finishing line, capable of producing
with an outside diameter of up to 9 5/8
LNG transportation. EVRAZ Regina’s tubular
SDP and carbon OCTG casing with an
inches. Couplings produced at ECM are
mills are important suppliers to the North
external diameter of up to 16 inches. Its
supplied to EVRAZ’s Calgary and Red
American energy markets, serving leading
products are primarily used in oil and natural
Deer OCTG casing and tubing operations.
energy producers and midstream operators
gas drilling, transportation and distribution,
in both Canada and the US.
as well as in the transportation of other
substances such as carbon dioxide.
50
1. Sales to third parties only
51
Meet EVRAZ
EVRAZ in figures
STRATEGIC REPORT
Corporate governance
Financial statements
Additional information
ANNUAL REPORT & ACCOUNTS 2021
Production highlights
COAL SEGMENT
Raw coking coal
Coking coal concentrate
RUSSIA
23,272 kt
14,448 kt
Raspadskaya is one of the leading
coal producers in Russia in terms
Sales highlights1
of both volume and cash costs.
It also has a diverse product
Raw coking coal
Coking coal concentrate
portfolio and diversified client
Yuzhkuzbassugol
Raspadskaya
686 kt
9,922 kt
base.
Mezhegeyugol
Financial highlights
Revenues
EBITDA margin
US$2,321 m
55.7 %
EBITDA
CAPEX
US$1,292 m
US$228 m
Mining and coal washing operations
Raspadskaya consolidates EVRAZ’ Russian coal assets, which are located in the Kemerovo region and the Republic of Tuva (Russia).
Mezhdurechensk site
Novokuznetsk site
Mezhegey
Raspadskaya has two operational
Raspadskaya has five coking coal mines
In the beginning of 2020, the decision
underground coking coal mines and two
in Novokuznetsk. They produce hard
was made to halt production
open pits in Mezhdurechensk, including
and semi-hard coking coal (Zh, GZh
at the Mezhegey mine. Subsequently,
the Raspadskaya mine, Russia’s largest.
and KS grades), which is processed
in December 2021 the decision was made
The site produces hard coking coal
into high-quality concentrate (classified
to resume mining operations in 2022.
(K and OS grades), semi-hard coking
as HCC grade internationally). Most of this
coal (GZh grade) and semi-soft coking
comes from the Yerunakovskaya-8 mine.
coal (GZhO grade). Its coal washing plant
At the Novokuznetsk site, Raspadskaya
is one of the most modern in Russia. It has
has two coal washing plants, which
low maintenance costs and is designed
produce customised coking coal blends
to process high volumes with few
and pulverised coal injection (PCI)
employees.
coal. The Kuznetskaya washing plant
produces high-quality HCC concentrate
for the domestic market. The Abashevskaya
washing plant produces a wide variety
of products tailored to specific customers’
needs.
52
1. Sales to third parties only
53
Meet EVRAZ
EVRAZ in figures
STRATEGIC REPORT
Corporate governance
Financial statements
Additional information
ANNUAL REPORT & ACCOUNTS 2021
SUSTAINABILITY
Sustainability governance
In December 2021, the Board
SUSTAINABILITY MANAGEMENT
of Directors of EVRAZ established
the Sustainability Committee -
an expansion of the previous Health,
ESG highlights, Steel segment
Safety and Environment Committee -
to drive the Group’s sustainability agenda.
Prior to that, in August 2021, we created
a separate sustainability-focused body
Lost-time injury frequency rate1, X
Key air emissions1, kt
GHG intensity ratio1, tCO2/tcs
Our approach
at the management level to supervise
and monitor the performance of corporate
At EVRAZ, we believe that sustainable development
functions in this area. Read more
plays a vital role in our success. To maintain focus
on pages 58-60 in the Health and safety,
0.74x
105.43
kt
1.90
on this important area, we have made ESG one
and environment section.
2021
0.74x
of the key bases of our business.
2021
105.43
2021
1.90
2020
0.85x
EVRAZ has internal corporate documents
2020
116.47
2020
1.95
2019
122.46
2019
1.94
Steel is a crucial material in the transition towards
in place governing its activities in the area
a circular, low-carbon economy. We recognise
of sustainability and requires strict compliance
Read more on
page 61
Read more on
page 68
Read more on page 62
our responsibility to produce it in a way that
throughout the business. We regularly
minimises the impact on the environment while
review and update both the requirements
Fatalities1, number of people
Wastewater discharges1, million m3
Non-mining waste recycling
responding to the needs of our stakeholders. We
and the documents themselves to ensure that
or re-use rate1, %
are looking at more than just our carbon footprint.
they remain aligned with our sustainability
We want to address all the ways in which we
agenda. The following are the most important
can improve on how we use the world's natural
documents for the Group:
6
74.32
105.4
resources, maintain close ties with our employees,
•Code of Business Conduct.
communities, and other stakeholders, and align our
2021
2021
2021
•Supplier Code of Conduct.
6
63.48
10.84
74.32
105.4
business with sustainable shareholder returns.
2020
1
2020
68.58
12.47
81.05
2020
103.1
•Health, Safety and Environmental Policy.
2019
7
2019 68.90
12.86
81.76
2019
105.6
•Social Investments Guidelines.
We aim to navigate sustainable development
Steel
•Anti-Corruption Policy.
challenges in current and future operations
Mining - Ore
•Hotline Policy.
and business processes across the Group
Read more on
page 61
Read more on page 69
Read more on
page 70
•Policy on Main Procurement Principles.
by focusing on:
•Human Rights Policy.
•Combatting climate change: mitigating climate
•Diversity and Inclusion Policy.
risks and reducing GHG emissions to contribute
•Modern Slavery Statement.
to urgent action against climate change impacts.
Environmental protection: taking responsibility
•
for preserving the natural environment
Best practices and standards
in the regions of our presence.
•
Employee wellbeing: providing safe working
EVRAZ strives to adhere to international
conditions, extensive learning and development
standards across its operations. We
opportunities, and competitive compensation
have been a participant in the UN
packages.
Global Compact initiative since 2020.
Diversity: promoting equal opportunities and zero
Consistent with the Group’s commitment
•
tolerance of discrimination of any kind.
to transparency, we make comprehensive
Local community development: supporting
ESG disclosures in our annual
•
the sustainable social and economic development
and sustainability reports and published our
of the regions in which we operate.
first climate change report in 2020. We align
our reporting with the recommendations of
international standards-setting organisations,
such as the Global Reporting Initiative (GRI)
and Sustainability Accounting Standards
Board (SASB).
54
1. Data on this indicator does not include EVRAZ coal segment.
55
Meet EVRAZ
EVRAZ in figures
STRATEGIC REPORT
Corporate governance
Financial statements
Additional information
ANNUAL REPORT & ACCOUNTS 2021
The Group’s Environmental Strategy 2030
and processes, but also into those
•Undertaking investments
EVRAZ fully supports the UN Sustainable Development Goals (SDGs), which the UN General Assembly
names GHG emissions management as
of the Group’s broader network of partners.
and operational measures aimed
approved in 2015. We make substantial efforts to contribute to the achievement of all SDGs, including by
one of a key activity. EVRAZ sets GHG
EVRAZ encourages potential partners
at improving energy efficiency,
providing quality employee benefits, promoting green technologies and encouraging the implementation
emissions targets within this strategy
to adhere to our sustainability values
developing internal power generation
of sustainability projects, among other initiatives. As part of our ESG agenda, we focus our efforts on
and discloses the methodologies used
by developing standards for suppliers.
capacity, using renewable energy
contributing to the following six priority SDGs:
to calculate them to better comply with
To evaluate suppliers, we conduct field
sources and upgrading equipment.
international requirements.
inspections and audits and collect
feedback from supplier representatives.
Environmental management
Read more on pages 62-66 in the Climate change
Our Procurement Commission verifies
•Continuing to implement waste
and GHG emissions section
information included in forms filled
management, water conservation
by representatives regarding their
and emissions reduction projects.
Stakeholder engagement
commitment to a responsible approach
•Implementing our biodiversity roadmap.
to HSE issues throughout the assessment
We ensure healthy lives and promote
Our core values include environmental protection,
We are closely engaged with our
phase for prospective suppliers. Non-
Our people
wellbeing for all.
including water resource management and biodiversity loss
stakeholders and recognise their rising
compliance with HSE requirements is one
•Revising our human resources strategy.
Read more pages 58-70 in the Health, safety and
prevention.
expectations, especially regarding
of the reasons EVRAZ would reject
environment section
Read more pages 67-70 in the Environmental management section
•Implementing a supportive learning
decarbonising our operations in alignment
a partnership. The Group strives to establish
structure for production managers
with the Paris Agreement, adhering
favourable circumstances for the socio-
aimed at developing new skills
to sustainability standards across the supply
economic growth of the regions in which it
for external change management.
chain, protecting the health and wellbeing
operates and collaborates actively with local
•Developing a long-term planning
of our employees and local communities,
suppliers.
programme to forecast our needs
and promoting diversity.
as an employer and enhance
the channels that we use to attract new
The Group’s key stakeholders
workers.
are employees, investors and shareholders,
Mid-term outlook
customers, suppliers and contractors, local
Community relations
We prioritise energy efficiency and
We promote diversity and inclusion and do not tolerate
communities, regulatory bodies, the media
EVRAZ aims to continuously improve its
Improving partnerships with local
•
combating climate change.
discrimination in any form.
and industry organisations. We strive
sustainability management practices. Our
communities in a variety of ways,
Read more pages 62-66 in the Climate change
Read more pages 71-73 in the Our people section
to deliver value to all our stakeholders
nearest and mid-term plans include major
including upgrading urban
and GHG emissions section
and improve engagement strategies
projects in the following areas:
infrastructure, financing sport events,
regularly. Our stakeholder engagement
and implementing educational
includes a wide range of interactive tools
Health and safety
and social projects.
and mechanisms. We rely on transparency
•Revising the operational model
and open communication when reaching
for safety management at our
We also strive to contribute
Canadian Chamber of Commerce.
The climate-related disclosure is discussed
out to our stakeholders and intend to do so
production to standardise and specify
•
to the achievement of the SDGs
Saskatchewan Chamber of Commerce.
in Task Force on Climate-related Financial
in future.
all the innovations implemented
•
through our membership in key industry
Canadian Manufacturers and Exporters
Disclosures (TCFD) compliance statement.
in the Company for 2020-2021.
•
and business associations and our
organisation.
collaboration with various institutes. In 2021,
•
Canadian Steel Producers Association.
see page ХХ
Responsible supply chain
Climate change and GHG emissions
EVRAZ was a member of the following
American Iron and Steel Institute.
management
•
•Calculation of Scope 3 GHG emissions.
organisations:
Donors Forum.
•
•Carrying out a quantitative assessment
Russian Managers Association.
Association of American Railroads.
The Group determines relevant climate-
Our approach to engaging suppliers
of climate-related risks.
•
•
related risks for the short, medium and long
is regulated by EVRAZ Policy on Main
•Russian Union of Industrialists
•Continuing to develop a climate strategy.
and Entrepreneurs.
term in line with TCFD recommendations.
Procurement Principles and the Supplier
•Updating accounting and monitoring
TCFD disclosure
Risks are categorized as transition or physical.
Code of Conduct. We are dedicated
practices for energy consumption.
•Association of Industrialists of Mining
and Metals Production Sector of Russia.
EVRAZ has evaluated climate-related risks
to integrating sustainability concepts
Disclosure of information regarding climate
and ranked them by importance.
into not just our internal operations
•World Steel Association.
change follows TCFD recommendations
•Russian Steel Association.
•
Non-Commercial Partnership National
and is broken down according to several
Read more on pages 92-96
Association for Subsoil Use Auditing.
categories: governance, strategy, risk
American Railway Engineering
management, and metrics and targets.
In 2022, the Group intends to carry out
•
and Maintenance-of-Way Association.
The Board of Directors oversees matters
a quantitative assessment of climate-
related to climate change, including
related risks. These risks are integrated
•Consumer Council on Operations
of OJSC Russian Railways.
by setting GHG emissions targets,
into the corporate risk management system,
as well as by assessing and managing
and EVRAZ has a strategy for mitigating
•Steel Construction Development
Association.
transition and physical climate risks. Climate
them.
is also within the remit of the Sustainability
•Russian Union of Metal and Steel
Suppliers.
Committee.
Read more on pages 84-96
56
in the Principal risks section
57
Meet EVRAZ
EVRAZ in figures
STRATEGIC REPORT
Corporate governance
Financial statements
Additional information
ANNUAL REPORT & ACCOUNTS 2021
including our line and senior management.
such as the World Steel Association’s Safety
The Company operates in accordance
HEALTH, SAFETY AND ENVIRONMENT
To bolster our HSE management systems
and Health Committee, as well as the HSE
with technical regulations,
and foster a safety culture, in 2021, EVRAZ
committees of Russian Steel (a Russia-
as well as the following documents governing
established two governing bodies within its
based non-commercial partnership)
labour protection:
Our approach
The Group adheres to international best
facilities to certify them under ISO 45001
organisational structure.
and the Russian Union of Industrialists
•HSE Policy.
practices in HSE. While international
as the validity period of OHSAS 18001
and Entrepreneurs. We evaluate
•Cardinal Safety Rules.
certification of the HSE management
expires.
In December 2021, the Board
and formulate proposals on various
•Fundamental Environmental Requirements.
HSE management systems
systems is not a legal requirement, most
of Directors transformed HSE Committee
legislative initiatives and work to develop
•Standard Incident Reporting Rules.
EVRAZ facilities are certified as compliant
The Group recognises that the engagement
into the Sustainability Committee. It
a common position among the associations’
Preserving the life and health of employees
with the requirements of the OHSAS 18001/
of senior executives in the HSE
plays a key role in managing HSE issues
members.
In 2021, the number of corporate HSE
and protecting the environment during
ISO 45001 occupational health and safety
management process is a crucial element
at the Board level and is responsible
documents was revised and amended.
our daily operations is an absolute priority
management and ISO 14001 environmental
in the plan to enhance the effectiveness
for setting the Company’s strategy in this
Some changes were made to the Standard
for EVRAZ. The Company operates
management standards. EVRAZ is currently
and improve the functionality of its
area.
HSE documents
Incident Reporting Rules. The Cardinal
HSE management systems to mitigate
aligning the occupational health and safety
HSE management systems. HSE issues
Safety Rules were also updated and a new
the associated risks in its operations.
management system for relevant
are considered at every corporate level,
In August 2021, EVRAZ established
The EVRAZ HSE Policy is the fundamental
lockout, tagout (LOTO) procedure
a Sustainability Management Committee
document regulating issues
was added that prohibits working without
at the executive level. The Group’s corporate
of environmental matters, including climate
applying safety locks.
strategy and performance management vice
change, issues related to biodiversity,
HSE GOVERNANCE STRUCTURE
president chairs the committee and the CEO
occupational health and safety
and heads of business units regularly attend
and the involvement of contractors in safety
Climate risk governance
its meetings. The committee’s tasks include
processes. The policy formalises the basic
BOARD OF DIRECTORS
driving improvements in the safety culture
principles that the Group has set for itself,
Issues related to climate change are handled
by setting and revising relevant goals
as well as the commitments that have been
by the Board of Directors and are considered
and approving annual KPIs for line managers.
made. The Company's policy is regularly
at regular Board and Sustainability Committee
At the level of the Group’s enterprises, local
reviewed, the last changes were made
meetings.
AUDIT COMMITTEE
CEO
SUSTAINABILITY COMMITTEE
HSE departments supervise HSE issues.
to it in 2021. EVRAZ strives to comply
with all requirements of labour protection
At the executive level, the Sustainability
EVRAZ actively engages with industry
legislation and internal Company rules.
Management Committee also considers issues
SUSTAINABILITY MANAGEMENT COMMITTEE
associations on matters related
related to climate change and decarbonisation.
to occupational health and industrial safety,
CORPORATE STRATEGY
TECHNOLOGIES
RISK MANAGEMENT
AND PERFORMANCE
DEVELOPMENT VICE
HSE VICE PRESIDENT
WORKING GROUP
MANAGEMENT VICE
PRESIDENT
PRESIDENT
ENERGY AND CLIMATE
ENVIRONMENTAL
HEALTH AND SAFETY
INDUSTRIAL SAFETY
MANAGEMENT
MANAGEMENT
DIRECTOR
DIRECTOR
DIRECTOR1
DIRECTOR
HSE REPRESENTATIVES AT ALL EVRAZ OPERATIONS
1. Appointed in January 2022
58
59
содержание .. 1 2 3 4 ..