Crude steel production in Ukraine totaled 2.4 Mt in 4M24, up 33% y-o-y, with finished and semi-finished steel output rising by 30% y-o-y to 2.0 Mt and hot metal production up 25% to 2.2 Mt.

EU country ambassadors agreed yesterday to use profits earned on frozen Russian assets in the EU to finance military and other support for Ukraine. The deal reportedly concerns the funds immobilized by the Belgian securities depository Euroclear, which holds c. EUR 190bn of Russian central bank assets (out of a total of c. $300bn collectively immobilized globally). It applies to profits accruing since mid-February 2024. Earlier this year, the EU approved a regulation ordering Euroclear and other EU clearing houses to set aside the frozen assets of the Russian central bank and ensuing profits.

State rail monopoly Ukrainian Railways (RAILUA) reported freight transportation of 15.2 Mt in April, down 4.9% m-o-m but up 29% y-o-y.

WSE-listed Ukrainian agricultural producer IMC reported 2023 net sales of $139m (+22% y-o-y), a gain from change in fair value of biological assets (IAS 41) of $15m (-67%), EBITDA of $3m (-91%; incl. IFRS 16) and net loss of $21m (vs. $1m loss in 2022).

NBU gross foreign reserves fell by 3.1% ($1.4bn) m-o-m in April, to $42.4bn, remaining up 4.7% YTD. The end-April reserve tally was equivalent to 5.5 months of prospective goods and services imports, according to central bank estimates. The official exchange rate of the hryvnia to the US dollar weakened by 1.1% m-o-m to UAH 39.67:USD on top of -2.6% in March, bringing the YTD rate of depreciation to -4.3%.

The Cabinet of Ministers has approved the distribution of Ukrainian Railways’ (RAILUA) 2023 net income, setting the amount of dividends to be transferred to the state budget at UAH 1.5bn ($39m). Additionally, UAH 1.0bn ($26m) was allocated to compensate the company for transportation of building materials used in construction of field fortifications and UAH 2.5bn ($64m) reinvested to cover the company’s CAPEX needs, including for reconstruction of rail infrastructure and modernization of the railcar fleet.

Power market operator Guaranteed Buyer paid UAH 4.3bn ($110m) to renewable power producers in May, settling part of its 2023 arrears. The latest payment increased last year’s monthly settlement rates as follows: January 2023 to 100% from 91%, February to 95% from 58%, July to 99% from 82%, August to 100% from 85%, and September to 97% from 85%.

According to provisional data from the Finance Ministry, the central budget ran a cash deficit of UAH 105bn ($2.7bn) in April, virtually unchanged from UAH 104bn in March.

The NBU on May 3 announced new sweeping F/X liberalization measures intended to improve business activity and attract investment. Among the key changes, the central bank: permitted companies to repatriate dividends on net income earned after Jan. 1, 2024, for up to EUR 1m (equiv.) per company per month (“new” dividends) permitted companies to service external debt raised before June 20, 2023 (“old” loans) by using funds in their onshore accounts and buying F/X for such debt service, on condition that there were no arrears under the relevant loan agreements as of Feb. 24, 2022, i.e. the start of the Russian invasion. Interest payments that fell due after Apr. 30, 2024, can be made without limitations. Overdue interest payments for the period from Feb. 24, 2022, to May 1, 2024, were capped at EUR 1m (equiv.) per calendar quarter per loan agreement. Such interest payments cannot be financed with a loan from another resident company, made ahead of schedule and restructured. shortened to one year from three years the minimum period upon which companies can buy foreign currency for amortization payments on external debt raised after Jun. 20, 2023 (“new” loans). Interest can be paid with purchased foreign currency regardless of the term of the underlying loan. abolished all restrictions on imports of services, permitted to transfer funds abroad under lease/rental agreements without any additional conditions, eased restrictions on F/X transfers from representative offices for the benefit of their parent companies, with these payments capped at EUR 5m (equiv.) per company per month.

State power transmission system operator Ukrenergo reported 2023 revenue of $2.3bn (-11% y-o-y), EBITDA of $281m (vs. close to zero in 2022), and net income of $10m (vs. $189m net loss in 2022). Net operating cash flow stood at $127m (vs. neg. $105m in 2022), net investment cash outflow totaled $43m (vs. $124m outflow in 2022) as the company received $68m from a state-owned coal mine as repayment of an earlier interest-free loan, and CAPEX expanded by 2.7x y-o-y to $111m. Net financing cash flow stood at close to zero (vs. inflow of $40m in 2022) as new borrowings of $167m offset scheduled debt redemptions of $60m and interest payments of $105m.

Russian gains in Donetsk region notably higher last week, on par with capture of Avdiyivka in February

WSE-listed Astarta Holding, Ukraine’s largest sugar producer, published its 1Q24 operating update, reporting sugar sales of 70 kt, down 14% q-o-q but up 37% y-o-y, priced at $649/t on average, down 2.1% q-o-q and 9.6% y-o-y. Grain and oilseed sales fell by 38% q-o-q to 334 kt (+10% y-o-y), including 215 kt of corn. Corn sale prices averaged $210/t (-2.1% q-o-q, -22% y-o-y). Soybean oil sales jumped by 31% q-o-q and 33% y-o-y to 14 kt in 1Q24, while soybean meal sales dropped by 5.8% q-o-q to 43 kt (+3.6% y-o-y). The average selling price of soybean oil declined by 3.3% q-o-q and 27% y-o-y to $786/t and that of meal fell by 0.5% q-o-q and 7.1% y-o-y to $484/t. Lastly, 1Q24 raw milk sales stood at 31 kt (+9.8% q-o-q, +6.2% y-o-y), averaging $438/t in price (+0.9% q-o-q and 17% y-o-y). (Company)

Ukraine’s headline current account (C/A) deficit widened to $1.6bn in March from $0.1bn in February, while the financial and capital account (F/A) deficit, including IMF financing, switched to a surplus of $8.1bn from a deficit of $1.3bn in February.

LSE-listed MHP, Ukraine’s largest poultry producer, held a conference call after publishing its 2023 results. The company confirmed its intention to repay the outstanding $211m of 2024 Eurobonds due on May 10 using the remaining IFI financing of $160m (out of initially raised $400m) and own liquidity. MHP reported its current cash balance at $316m, with $160m held offshore, down from $436m as of end-2023 due to seasonal working capital investments made in 1Q24 and expenses on a recent tender offer to repurchase 2024 bonds. The IFI loans, to be utilized in full with the redemption of the 2024 bond, will be repaid in semiannual instalments over five years. MHP confirmed its ability to service the IFI debt using its local liquidity.

DTEK Renewables published its 2023 financial results, announcing that it intends to start negotiations with bondholders to extend the maturity of its EUR 325m bond due on Nov. 12, 2024 (EUR 44m was previously repurchased but not cancelled). The company also confirmed that it remains in breach of covenants attached to its bank and non-bank borrowings of EUR 222m, with this debt becoming due on demand and reclassified as current liabilities.

The National Bank’s index of business activity expectations, a PMI-type gauge, inched up by 0.3 points m-o-m in April, to 52.3 on a 0-100 scale (+0.7 y-o-y).