Alchevsk Iron and Steel Works

Alchevsk Iron and Steel Works is an integrated steel company. It used to be a part of the Industrial Union of Donbas corporation. Control over the company was lost in December 2017.

Alchevsk Iron and Steel Works produces semi-finished products (slabs and square billets), flat and long products, including structural shapes. Slabs were shipped to the EU companies of the ISD Group — ISD Dunaferr (Hungary) and ISD Huta Częstochowa (Poland).

Location: Alchevsk, Luhansk oblast, Ukraine
Shareholders: Owner: the Industrial Union of Donbas Nationalized by breakaway authorities and controlled by Vneshtorgservis CJSC (South Ossetia)
Markets: Russia, possible reexport to other countries Key markets until 2017 — Poland, Hungary, Russia
Products: Slabs, square billets, hot-rolled heavy plates

Production capacity

Production of coke 6 batteries, 3,840 thousand tons
Production of iron ore agglomerate 6 sinter machines, 5,400 thousand tons
Blast-furnace production 4 blast furnaces, 5,320 thousand tons
Production of steel 2 BOFs, 5,472 thousand tons
2 double-strand slab casting machines
Twin ladle furnace
Vacuum degasser
Manufacture of rolled products blooming slabbing 1250
plate mill 2250
plate mill 3000
semi-continuous heavy section mill 600

Staff and wages

Number of employees 13,447 (2014)
12,296 (2015)
Average wage* UAH 64,000 per annum (2014)
UAH 50,000 per annum (2015)
Workforce productivity 186 tons of steel per annum (2014)
55 tons of steel per annum (2015)

* per worker before taxes

Charts and tables

Production results, thousand tons

40003500300025002000150010005000
2012 3555 kt2012
2013 3283 kt2013
2014 2102 kt2014
2015 1149 kt2015
2016 1356 kt2016
2017 118 kt2017
6000500040003000200010000
2012 5170 kt2012
2013 5243 kt2013
2014 3153 kt2014
2015 1127 kt2015
2016 2260 kt2016
2017 283 kt2017
40003500300025002000150010005000
2012 3520 kt2012
2013 3791 kt2013
2014 2340 kt2014
2015 692 kt2015
2016 1332 kt2016
2017 155 kt2017
5000450040003500300025002000150010005000
2012 3869 kt2012
2013 4174 kt2013
2014 2503 kt2014
2015 681 kt2015
2016 681 kt2016
2017 158 kt2017
2018 782 kt2018

Indicative sales structure by products in 2018 *

Indicative sales structure by countries in 2018 *

* structure of sales volumes, metric tons

Financial performance, $ million

 20132014201520162017
Sales18451252361N/AN/A
EBITDA-80247127N/AN/A
EBITDA margin-4.3%19.7%35.2%N/AN/A
Net income-217-1698-1076N/AN/A
Net income margin-11.8%-135.6%-298.2%N/AN/A
CAPEX000N/AN/A

Key facts

In February 2017

The plant completely stopped. In December 2017, the blast furnace 5 was put into operation. Since then, the plant has been operating as a branch of Vneshtorgservis CJSC. According to the media, iron ore is shipped as humanitarian aid through Rosrezerv, Russian state agency. Finished products are sold through Russia’s Gaz-Alliance, an intermediary between Vneshtorgservis CJSC and final consumers.

In a commentary to the mass media, a representative of Vneshtorgservis said that Alchevsk Iron and Steel Works produced 1.5 million tons of finished products from December 2017 to December 2018. The 2019 target is to increase the output.

In October 2018

The Commercial Court of Luhansk oblast instituted the bankruptcy proceedings against Alchevsk Iron and Steel Works. A debt moratorium was imposed, and an arbitration manager was appointed.

In November 2018

A vessel was arrested in Mariupol that transported products of Alchevsk Iron and Steel Works from a Russian port to Belgium.

In January 2019

The roof of a shop of Alchevsk Iron and Steel Works collapsed. In February 2019, the plant was on the verge of shutdown because of the lack of raw materials.

Sources: websites of the companies, media outlets