Ferrexpo swings to FY loss on legal provision

18th Apr 2024 08:07

(Sharecast News) - Iron ore pellet maker Ferrexpo swung to a full-year loss as a $131million provision for a legal dispute involving its Ukrainian unit hit the bottom line.

The company on Thursday reported a loss of $85m for the to December 31, compared with a $220m profit in 2022. Earnings would have been $46m without the provision, it added.

"With advice from our Ukrainian legal counsel, we believe that the various claims are without merit and that we have strong legal arguments to vigorously defend ourselves in court," Ferrexpo said on Thursday.

Ferrexpo has been fighting legal claims against its Ukrainian unit Ferrexpo Poltava Mining (FPM) over contested sureties related to its controlling shareholder. It has also face severe constraints due to the war with Russia.

Looking ahead, the company said the increase in demand experienced in December 2023 had continued in to the first quarter of the year.

"We have seen good demand for our premium products in Europe and elsewhere, which provided us the confidence to start a third pelletiser line. This means that we have more production flexibility than at any other time during the war. It also means that we are able broaden our product mix, including restarting production of DR pellets again," it added.

Reporting by Frank Prenesti for Sharecast.com