September 07, 2008

Laiwu Steel reports 48.11% rise on net profit last year

Laiwu Iron & Steel Company Ltd has seen sales revenue up by 22.01% YoY to CNY 32.92 billion, total profit up by 34.94% to CNY 1.58 billion and net profit up by 48.11% to CNY 1.14 billion last year on back of healthy market demand and competitive product offerings.

Its steel output only grows 2.7% while the steel product price jumps 18.8% in 2007. The company has raised up the gross profit margin by 1.68 percentage points since it has made greasy profits from section and premium steel products.

Laiwu Steel boasts annual capacity of 6 million tonnes and ranks as the leading producer of both section steel and carbon steel. It produced 3.3 million tonnes of H-beam last year taking up 38.48% of the domestic market. H-beam has contributed 27.12% of its sales revenue last year as opposed to 18.36% in 2004. Meanwhile, less profitable carbon steel has only accounted for 41.76% of its earnings last year down from 59.75% in 2004.

Laiwu Steel has stepped up production of high end premium steel products over the years. It has risen to the biggest pinion steel producer in China and established close ties with major clients such as FAW, Ford and Dongfeng Motors.

(Sourced from MySteel.net)