Strategy

Grigory Fedorishin

President of NLMK Group

NLMK transforms ideas and resources into steel products. We source ideas from our employees, customers and business partners. We are striving to control our resources, taking a safe and responsible approach to their recycling and re-use. We produce clean and durable steel which is used in thousands of applications that improve our everyday live.


NLMK Engineering's strategic goal

To be a leader in superior customer experience

Key elements of Strategy 2017:

  • Net gains of $1.0 bn pa. vs. 2013 EBITDA due to cost reduction and sales profitability increase
  • Structural reduction of annual capex
  • Conservative leverage: Net debt/EBITDA of 1.0x
  • Stable positive free cash flow and dividend payments in accordance with a revised dividend policy
  • Sustainable development

To reach these goals we have set the following objectives:

  • Maximum use of potential to enhance operational efficiency through investment programmes and NLMK Production System.
  • Increased self-sufficiency in iron ore with a flexible charge structure and consequentially reduced consumption of expensive resources.
  • Leading position in strategic markets through higher utilization rates of existing capacities; growth in domestic sales and an increased share of HVA products, taking advantage of the proximity of the Company's production assets to major customers, high quality products and close cooperation with customers.
  • Leadership in sustainability and safety, maximum opportunities for professional development.
    • Systematic minimization of our environmental footprint to achieve best global practices;
    • Compliance of production processes with the strictest environmental and OHS standards;
    • Leadership in labour productivity for the sector supported by empowered and motivated staff.
    • Conditions for high labour productivity enabled with professional training and through fostering of a strong corporate culture.

Strategy 2017 goals

  • Leading positions in strategic markets

    • Boost steel product sales by 2.5 million tonnes a year

    • Increase the share of domestic sales to 45%, versus 39% in 2013

    • Achieve target net gains of $190 million a year

  • World-class resource base

    • Achieve full self-sufficiency in iron ore

    • Reduce consumption of high-cost resources

    • Achieve target net gains of $480 million a year

  • Leadership in sustainability and safety

    • Minimise environmental impact

    • Ensure full compliance with occupational health and safety standards

    • Achieve industry-wide leadership in labour productivity supported by motivated, engaged personnel

  • Leadership in operational efficiency

    • Fully implement NLMK Production System

    • Achieve target net gains of $330 million a year