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#VSMPO-AVISMA Corporation has no plans to suspend the corporate activities

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June 19 2020

Press release

June 18, 2020

Shareholders of VSMPO-AVISMA: Suspension of the company activities is not considered by the shareholders. The statement made Maxim Kuzyuk, Acting Director General, does not reflect the reality.

June 17, 2020: During the open meeting with the Trade Union representatives Maxim Kuzyuk, Acting Director General, referred to potential suspension of the company activity in September if it fails to secure new orders. This statement is a personal opinion of Maxim Kuzyuk and has no relevance to the reality. 

Potential suspension of production processes has never been considered by the shareholders. Production sites are working and will continue to work as usual. Indeed, reduction of air travel and the current pandemic situation made VSMPO-AVISMA Corporation significantly adjust the corporate activities and revise a number of projects. Thus, in April the planned titanium output for 2020 was reduced, nonproduction costs were significantly cut down, and the investment program was temporarily suspended.

These measures are aimed primarily at maintaining the efficient performance of production sites and maintaining the number of employees. Today, the global aviation industry shows signs of recovery, the economic activity of major European and US customers of the company is growing. Partners start renewing previously suspended contracts. This is indicative of potential growth of the company order backlog for 2020. The planned order quantity for 2020 is 26.5K tons. Thus, even with the most conservative estimation of the global titanium market evolution, the company will be able to ensure revenues of over $ 1 billion. This is enough to support a stable operation of the company in 2020.

 

Public Stock Company VSMPO-AVISMA Corporation is a Russian vertically integrated metallurgical company, a world’s leading manufacturer of high-tech titanium products. VSMPO-AVISMA has a 25% share of the global titanium market and is a major supplier to many aircraft manufacturers worldwide. The company has 300 customers in 50 countries, 1.500 consumers in Russia, its own extensive distribution network in Europe, North America and Asia, and production facilities in the US. It is the world’s only titanium producer with a full production cycle, from processing of raw materials to release of the finished products. VSMPO-AVISMA Corporation also produces large extrusions of aluminum alloys, semi-finished products of alloy steels and high-temperature nickel-based alloys. The Corporation consistently invests in the expansion and development of production facilities, focusing on production of high value-added components. The Corporation has its own Research and Development Center engaged in the development of new alloys and manufacturing processes, among which is the latest development – VST2 alloy, which exhibits a unique combination of the highest strength and relatively low weight and improved ballistic properties superior to those of steel. Distribution of the assets of VSMPO-AVISMA Corporation: private equity capital – 65%, the golden share of 25%+1 is owned by the State Corporation Rostec, other shares of the Corporation are in public float.