September 08, 2008

Baosteel H1 net profit jumps up by 80% YoY

It is reported that Baoshan Iron and Steel Co has posted 80% YoY increase in earnings during January to June 2007. It posted net earnings of CNY 8.16 billion (USD 1.08 billion) as compared to CNY 4.53 billion in January to June 2006. Baosteel's H1 profit was boosted by CNY 871 million of investment income nearly double the year earlier investment gain of CNY 488 million. Its turnover in H1 of 2007 climbed up by 29% YoY to CNY 94.12 billion.

Baosteel sold 10.8 million tonnes of steel products in the first half as against 10.9 million tonnes in H1 of 2006.

Baosteel said that Chinese steel prices might face downward pressure in the second half of 2007 because of increasing domestic supply. It added that “This will be offset by strong domestic and foreign demand, and by the closing of some of China's obsolete production capacity, so fluctuations in steel prices will not be too large.”

Baosteel said that its stainless steel operation would face a big challenge in the second half because of large price fluctuations for the material.