Severstal: Q2 2026 revenue down 8.6%, net profit down 74.1% amid weak market conditions and rising costs
In Q2 2026, Severstal's revenue declined 8.6% year-on-year to RUB 169,564 million, while EBITDA fell 39.7% to RUB 23,112 million and net profit dropped 74.1% to RUB 4,062 million. Weak demand and rising costs weighed on results, compressing margins.
Key figures, RUB bn
| Metric | Q2 2025 | Q2 2026 | Change |
|---|---|---|---|
| Выручка / Revenue | 185 | 170 | -8,6% |
| EBITDA / EBITDA | 38,4 | 23,1 | -39,7% |
| Операционная прибыль / Operating profit | 27,7 | 10,2 | -63,3% |
| Чистая прибыль / Net profit | 15,7 | 4,06 | -74,1% |
| Операционный денежный поток / Operating cash flow | 42,5 | -5,05 | -111,9% |
| Капзатраты / Capex | 20,4 | 14,1 | -30,9% |
| Рентабельность по EBITDA / EBITDA margin | 20,7% | 13,6% | -7,1 п.п. |
| Чистая маржа / Net margin | 8,5% | 2,4% | -6,1 п.п. |
What the report showed and what's behind it
In Q2 2026, Severstal's revenue amounted to RUB 169,564 million, down 8.6% year-on-year. EBITDA fell 39.7% to RUB 23,112 million, and net profit dropped 74.1% to RUB 4,062 million. The decline reflects weak steel market conditions and continued price pressure. Operating profit in Q2 was RUB 10,166 million, well below year-ago levels.
Quarterly dynamics: revenue, % YoY
Margins and costs
EBITDA margin in Q2 2026 was 13.6% versus 20.7% a year earlier, indicating a significant deterioration in operating efficiency. Net margin fell to 2.4% from 8.5% in the same period last year. Rising costs and weak selling prices compressed the spread between revenue and cost of sales. Margin pressure is likely to persist in coming quarters unless market conditions improve.
Debt, cash flow, capex
Net debt at the end of Q2 2026 stood at RUB 77,326 million, up RUB 28.2 billion from the previous reporting date and RUB 84.6 billion over the last 12 months. Operating cash flow in Q2 was negative at minus RUB 5,049 million, due to working capital build-up and weak operational dynamics. Capital expenditures amounted to RUB 14,100.8 million, lower than in previous quarters but still significant for cash flow. Net debt to EBITDA for the trailing twelve months stands at -0.95, reflecting the current leverage level.
Valuation and what to watch in the next report
The current EV/EBITDA multiple for the trailing twelve months is 5.9, above the three-year average of 4.6, indicating that the stock trades at a premium to its own history. P/E for the trailing twelve months is 8.97, ROE is 4.19%. In the next report, key factors will be steel price dynamics, cost control, and the ability to restore positive operating cash flow. Also important will be changes in net debt and capex, which could affect free cash flow.
Valuation on the latest reported figures
| Metric | Value |
|---|---|
| Капитализация / Market cap | 505 млрд ₽ |
| P/E (LTM) | 9,0 |
| EV/EBITDA (LTM) | 5,9 |
| P/B | 1,02 |
| Чистый долг / EBITDA (LTM) | -0,95 |
| Операционный денежный поток (LTM) | 124 млрд |
| ROE | 4,2% |
| EV/EBITDA, среднее за 3 года | 4,6 |
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