Mechel Romania earns 60M euros in profit

The Russian shareholders of Mechel own four steel mills in Romania and scored their best year in 2008 when they made a net profit worth 60 million euros (221 million lei), 19 times up on the previous year.

Mechel earned a turnover worth 671.9 million euros (2.45 billion lei) last year, by 36 percent higher than in 2007.

Mechel is the biggest concrete iron maker on the Romanian market, at a quota of round 65 percent, and puts out 1 million tonnes concrete iron, yearly.
The Romanian-based works, having Russian owners, also make special steels and wire products, the Ziarul financiar reads on.

Last year, the Russian Group succeeded to make profit in all its three companies in Romania, namely Mechel in Targoviste, Mechel in Campia Turzii and Ductil Steel in Buzau, the last one also including the Otelul Rosu steel mill.

Its profitability relies on the restructuring Mechel carried out in Romania during the latest years, curbing its staff by round 1,850 employees in the past two years only. At present, the four mills number about 6,700 people.

The profits Mechel earned in 2008 are strongly different from that made in 2009, a crisis year. Thus, Mechel Targoviste and Mechel Campia Turzii amassed losses worth 36.6 million euros (154.3 million lei), while their business dropped by 60 percent.

In this context, the Group has recently decided on borrowing 30 million euros from Erste Bank for the iron and steel plants it owns in Romania.

Mechel Targoviste (COS) is listed on the stock exchange and its capitalisation stands at present at 22.9 million euros, while Mechel Campa Turzii’s stock is traded on the RASDAQ market, and Company’s market value is worth 9.2 million euros.

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