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Interpipe sees profit fall by 75%, increases free cash

KYIV. Sept 13 (Interfax-Ukraine) – In January-June of this year, the international vertically integrated pipe and wheel company Interpipe reduced its net profit by about 74.4% compared to the same period last year, to $29.431 million from $115.529 million.

According to the company’s interim report on operating and financial results for the second quarter and the first half of 2021, pre-tax profit in January-June decreased 58.3%, to $50.766 million from $123.495 million in the same period in 2020.

At the same time, operating profit halved – to $62.847 million from $128.058 million.

Interpipe received $111.209 million EBITDA in the first half of this year, which is 25.4% less than the same period last year ($148.980 million). The company’s revenue during this period decreased by 1.7%, to $460.471 million, while capital investments increased by 66%, to $31 million.

In addition, Interpipe increased its free funds from $96.631 million at the beginning of this year to $206.008 million by the middle of the year. In the same period last year, Interpipe reduced free funds from $256.148 million (at the beginning of 2020) to $186.790 million (as of mid-2020).

As reported in the company’s press release, Interpipe’s net debt at the end of the first half of 2021 was $199 million, while the net leverage ratio (net debt to EBITDA) remained stable at 0.9x.

In the second quarter of this year, revenue increased by 29% compared to the previous quarter, to $260 million, EBITDA increased by 75%, to $71 million, and the amount of capital investments increased by 20%, to $14 million.

Capex in new projects tripled year over year, to $21 million.

As of June 30, 2021, the company’s total debt increased to $199 million following the successful placement of a new $300 million eurobond issue with a rate of 8.375% maturing in 2026. The net leverage ratio remained stable at 0.9x.

Interpipe in January-March this year reduced its net profit by 90.4% compared to the same period last year, to $12.826 million from $133.064 million. In the second quarter, revenue decreased by 19.9%, to $200.952 million, EBITDA – by 53%, to $40 million, the amount of capital investments increased by 58%, to $17 million. Net debt was $53 million with the net leverage ratio of 0.2x. As of March 31, 2021, the company’s total debt fell to $110 million following the full redemption of the 2024 eurobonds on January 26, 2021, keeping the net leverage ratio low at 0.2x.

Interpipe is a Ukrainian industrial company, a manufacturer of seamless pipes and railway wheels. The company’s products are supplied to more than 80 countries all over the world through a chain of commercial offices located in the CIS, Europe, the United States and the Middle East.