Ferrexpo books annual loss on provision for Ukraine legal woes

(Reuters) - London-listed miner Ferrexpo reported an annual loss on Thursday, hit by a $131 million provision for the on-going legal disputes against its Ukrainian unit Ferrexpo Poltava Mining (FPM).

The company posted a loss of $85 million for the year ended Dec. 31, compared with a $220 million profit in 2022.

If not for the provision, Ferrexpo said it booked a profit of $46 million, which is however, still lower than the previous year due to the Russia-Ukraine conflict and lower gains from foreign-exchange swings.

The FTSE 250 firm was cautiously optimistic about the current year, saying that the increase in demand towards the end of 2023 had continued into this year, but stopping short of outlining production and cost guidance for 2024.

"Depending on the availability to export through different Black Sea ports, the opportunity to expand production further with the restart of the third pelletiser line remains. This will be contingent on sufficient supply of consumables, a balanced and skilled workforce, and logistics capacity," Ferrexpo said in a statement.

Ferrexpo, which is the world's third-largest exporter of iron ore pellets, has been fighting legal claims against its Ukrainian unit FPM over contested sureties related to its controlling shareholder, and from its supplier Kysen.

Shares in Ferrexpo have also been pressured due to supply woes in light of the conflict, having dropped about 81% since the war began in February 2022.

(Reporting by Eva Mathews in Bengaluru; Editing by Rashmi Aich)