Investor Presentaiton
Management's Discussion and Analysis
Nine months ended September 30, 2011
creditors. Significant amounts of cash related to proceeds and repayments of
borrowings reflect refinancing of existing loans with lower interest rates.
In the first nine months of 2011, we made full year dividend payments for
2010 in the amount of U.S.$23 million to shareholders of OAO TMK based
on the decision of our shareholders at the annual shareholders meeting in
June 2011. We also paid U.S.$2 million to non-controlling shareholders of
our subsidiaries compared to U.S.$1 million in the first nine months of
2010.
Indebtedness
The following table illustrates the maturity profile of our total financial
debt:
As a result of actions undertaken to improve the debt maturity profile, the
share of short-term debt decreased to 12% as of September 30, 2011 as
compared to 18% as of December 31, 2010.
The debt portfolio includes fixed as well as floating interest rate debt
facilities. As of September 30, 2011, borrowings with a floating interest rate
represented U.S.$399 million, or 11%, as compared to U.S.$3,334 million,
or 89%, of borrowings with a fixed interest rate.
The weighted average nominal interest rate decreased 84 basis points as
compared to December 31, 2010 and stood at 7.02% as of
September 30, 2011. Measures to improve the structure of our loan portfolio
will be continued.
The most significant credit facilities as of September 30, 2011 were as
follows:
1 year or
less
1 to 3
years
Over 3
Unamortised
Total
years
debt issue costs
debt
At September 30, 2011
451
1,513
in millions of U.S. dollars
1,829
Bank
Type of borrowing
Original
currency
Outstanding
principal amount
Maturity period
(24)
3,769
in millions of U.S. dollars
At December 31, 2010
706
1,222
1,968
(24)
3,872
Loan
Gazprombank
USD
608
January 2017
7.75% LPN
USD
500
January 2018
The current debt portfolio comprises diversified debt instruments, including
bank loans, bonds, convertible bonds and other credit facilities. Total
financial debt decreased 3% from U.S.$3,872 million as of
December 31, 2010 to U.S.$3,769 million as of September 30, 2011. The
net amount of debt repayment in the first nine months of 2011 equaled to
U.S.$37 million. However, the depreciation of the Russian rouble against
the U.S. dollar resulted in a decrease of the U.S. dollar equivalent of the
Russian rouble-denominated loans in the financial statements as of
September 30, 2011. As of September 30, 2011, U.S. dollar-, Russian
rouble and euro-denominated debt accounted for 49%, 45% and 6%,
respectively, of the total financial debt.
Loan
Loan
Loan
Loan
Loan
Loan
5.25% convertible bonds
USD
413
February 2015
Loan
Alfa-Bank
RUR
320
November 2016
Loan
Sberbank of Russia
RUR
314
September 2015
Bonds, series б0-01
RUR
157
October 2013
Gazprombank
RUR
144
March 2014
Sberbank of Russia
RUR
138
April 2016
Sberbank of Russia
RUR
125
December 2015
Gazprombank
RUR
107
January 2014
Gazprombank
RUR
107
Wells Fargo
USD
96
February 2014
August 2016
3,029
Other facilities
TOTAL BORROWINGS
707
3,736
17View entire presentation