29 October 2008
Trading Update
Ferrexpo plc ("Ferrexpo" or the "Group") announces that since the release of its Interim Management Statement on 15
October 2008, the Group has been notified of materially reduced demand for iron ore pellets by a number of its export
contract customers for the remainder of the year due to a significant reduction in both steel demand and output. As a
result these customers have requested deferral of some Q4 2008 planned deliveries into 2009. This will result in a
significant increase in unallocated production in the current year. The Group estimates that this slowdown in demand
will have a negative impact of around 5% to 10% of its expected sales for the full year in 2008.
This weakness in demand has mainly impacted the Group's 62% Fe product, prompting the Group to reduce production of
these pellets in the remainder of the fourth quarter. The resulting reduction in variable costs together with the
falling price of diesel and steel inputs and the rapid devaluing of the Ukrainian Hryvnia will partly mitigate the
impact on full-year earnings.
