A New Blow for Ferrexpo: The Company Faces a Penalty of Dozens of Billions of Hryvnias

Ukrainian tax authorities are considering imposing a fine of approximately 35.3 billion UAH, or $788 million, on the Poltava Mining and Processing Plant – the main production asset of Ferrexpo.

The claims relate to alleged non-compliance with state currency control restrictions. The company received a report based on the results of an unscheduled documentary inspection, which was conducted without a site visit.

Ferrexpo stated that the tax service did not take into account circumstances relevant to the case. Poltava Mining has already filed formal objections with the local tax authority.

The amount is not yet a finally assessed penalty. If the tax authority upholds the company’s objections, the inspection findings can be reviewed. If they are rejected, the authority must make a separate decision on the application of sanctions. Ferrexpo plans to appeal it.

The new claim increases financial pressure on the company, which has already faced logistical problems, court proceedings, and restrictions caused by the war. Ferrexpo also reported the suspension of iron ore production in Ukraine.

According to the company's estimate, the available cash resources will suffice until approximately mid-September. Earlier, Ferrexpo warned that without attracting additional financing, the risks to its solvency would increase significantly.

Based on materials from: Bloomberg