April, 05 2006
RINL registers 4% growth in turnover during 2005-06
Rastriya Ispat Nigam Limiteds Visakhapatnam Steel Plant has achieved a sales turnover of Rs 8,469 crore during 2005-06 as compared to Rs 8,181 crore in 2004-05, registering a growth of 4%. Of the total sales turnover, exports accounted for Rs 443 crore, a growth of 78%.
VSP produced 4.15 million tonnes of hot metal, 3.60 million tonnes of liquid steel and 3.23 million tonnes of saleable steel, registering a growth of 6%, 1% and 2% respectively.
RINLs net profit was Rs 2,008 crore in 2004-05. The company was expecting a lower net profit of Rs 1,200 crore in 2005-06 and Rs 1,000 crore in 2006-07.
RINL CMD Mr Y Siva Sagar Rao said the The company paid an additional amount of about Rs 450 crore for raw materials in 2005-06 due to the increase in several raw material costs. This apart, the steel prices dipped 23% in 2005-06. Owing to this, we expect a 40% drop in net margins during this year he said.
TCIL to double capacity
Mr Bushen Raina MD of Tinplate Company of India informed, on the sidelines of "Enabling Excellence" a seminar organized by the Confederation of Indian Industry, that the company is looking at investing more than Rs 200 crore in doubling capacity. TCIL has appointed Boston Consulting Group for penning the expansion strategy and that BCGs recommendations would be taken up at a board meeting to be held later in the month.
TCIL has already invested Rs 57 crore in the ongoing expansion programs. At present, TCIL has a capacity of 170,000 tonne after ramping it up from an installed 90,000 tonne. The current expansion plan entailed raising capacity to 180,000 tonne. The company has also invested in downstream value added facilities like printing and lacquering.
Indian government to cut high grade iron ore export
Indian government may cut down on iron ore exports by 2 to 3 million tonne in a bid to help local companies without captive mines. Steel minister Mr Ram Vilas Paswan, on the sidelines of a steel seminar organized by the Confederation of Indian Industry, Indian Steel Alliance and Hewlett-Packard said Various local companies such as Jindal Steel, Ispat and Essar Steel do not have captive mines. Also, we have to help meet ore requirements of the Rashtriya Ispat Nigam Ltd. Thus, we are working on cutting down iron ore exports. We are not stopping exports completely. We are only reducing the amount a little bit, that too the high quality variety. It is India's resources. Our domestic steel companies should not be deprived of any essential resources" said Mr Paswan.
Mr Paswan said that the ministry had taken up the issue of capping export of high grade iron ore with the Cabinet. As per the ministrys proposal, ore exports by state owned National Mineral Development Corporation may be moved to a lower band of permissible exports. The steel ministry had earlier fixed the NDMCs exports in the band of 1.7 million tonnes from 6.5 million tonne. We are now considering the lower band to 1.5 million tonne from the current 1.7 million tonne the minister said.
While the 2-3 million tonne cut in exports would be minuscule compared with the 78 million tonne exported in the last financial year, it is significant as it is a cut in high grade ore. Of the total ore exports, the high iron content ore with over 64% Fe has 25% share.
NINL reports 11.35% growth in pig iron production in 2005-06
Unperturbed by the labor strike and violence around its plant, pig iron producer Neelanchal Ispat Nigam Limited reported 11.35% jump in pig iron production to 615,000 tonne during the fiscal 2005-2006. NINL also registered hot metal production at 680,000 tonne higher by 10.36% compared to 2004-05. NINL said that the company also fared well in coke production and power generation. "In the last fiscal, 705,000 tonne of coke was produced which was substantially higher compared to 2004-2005," the release said.
NINL exported 312,761 tonne of pig iron registering 13.78% growth making it the largest exporter of pig iron in the country.
NINL also announced that it has started work on its steel melting shop which would have a capacity of 0.9 million tonnes. After commissioning of this shop in around three years time, the company would produce mild steel and special steel billets.
NINL, promoted jointly by Industrial Promotion and Investment Corporation of Orissa Limited and MMTC has its facility in Kalinga Nagar of Jajpur district.
Indian iron ore miners eyeing long term deals with Chinese buyers
It is reported that Indian miners will explore long term contracts next week to supply iron ore to Chinese steel mills. Mr RK Sharma secretary general of the Federation of Indian Mineral Industries told news agencies that "I have been talking to our industry that spot sale is not the solution in our long-term interest. We should go for long term contracts directly between Indian mines and Chinese steel mills as it is in the interest of Indian mines and Chinese steel mills to enter into long-term contracts."
Mr Sharma said that long term arrangements would be explored during a conference on iron ore jointly being held by Indian and Chinese industry in China`s Qingdao during April 13-14.
India, which exported about 85 million tonnes of iron ore in 2005-06, has long term deals with Japan but is estimated to have sold 68.5 million tonnes to China on spot basis.
Exports on spot basis usually fetch 15-20 percent more than long term contracts, but they run the risk of fluctuating demand.
JSW Steel divests stake in energy arm for Rs 513 crores
JSW Steel has offloaded its stake in JSW Energy to Samarth Holdings, a part of the OP Jindal group for Rs 513 crore by selling 14.44 crore equity shares of JSWEL, formerly known as Jindal Thermal Power Company. JSW had initially invested in JSWEL in 1995 and over four to five years had put in Rs 145 crore.
JSW Steel will use the resources raised from the divestment to retire debt and for capital expenditure. The company is currently in the process of expanding steel capacity from 3.8 million tonnes to 7 million tonnes, setting up a cold rolling complex and increasing capacity of its palletizing plant from 4.2 million tonnes to 5 million tonnes.
New ED for Salem Steel Plant
Mr PM Balasubramanian has assumed charge as Executive Director of SAIL's Salem Steel Plant with effect from April 1 2006. He was earlier General Manager in charge at SSP. Mr Balasubramanian has rich and varied experience in the production of stainless steel and maintenance of utilities like oxygen plant besides project construction.
Mr Balasubramanian after his graduation in Mechanical Engineering from Regional Engineering College Warangal joined Bokaro Steel Limited in 1972 and subsequently moved to Salem Steel Plant in 1978. He worked in different sections of Cold Rolling Mills Operations in SSP and headed CRM till 1996. Thereafter he took over Technical Administration for 6 years and became GM Works in April 2002.
Usha Martin registers 10% growth in 2005-06
Usha Martin Limited, a leading producer of specialty steel and wire rope, has achieved a growth of 10% in steel production to touch 323,000 tonnes in the fiscal year 2005-06. Usha Martin also registered a 28 per cent increase in its value added products such as wire and wire ropes to over 122,000 tonnes, a company release said.
Usha Martin has manufacturing facilities in Ranchi, Jamshedpur and Hoshiarpur in India besides Britain, Thailand and United Arab Emirates and has a worldwide distribution, service and marketing network spread across the US, UK, Europe, Australia, Africa, Singapore and the Middle and Far East.
Inox Air takes 50% share in BOCs JV for gas supply to JSW Steel
BOC Ltd had set up a special purpose vehicle, Bellary Oxygen Company Pvt Ltd. for the purpose of implementing and operating the long term gas supply contract entered into by it with erstwhile Jindal Vijaynagar Steel Ltd now known as JSW Steel Ltd. The said contract was subsequently assigned in favor of Bellary Oxygen Co Pvt Ltd. Further, the Company had made an investment towards 50% equity share capital of Bellary Oxygen Company Pvt Ltd.
BOC Ltd said that Inox Air Products Ltd has now taken up the balance 50% equity share capital of Bellary Oxygen Company Pvt Ltd. as a 50:50 JV partner in the said SPV in terms of the joint venture agreement entered into by the Company with Inox Air Products Ltd.
KSK Energy plans 250MW thermal power plant in Satna in MP
KSK Energy Ventures Ltd promoted Satna Power Co Pvt Ltd has proposed to set up a 250 MW thermal power plant in Satna in MP. Under the first phase, the company will set up two units of 125 MW and later it will set up three units of 77 MW.
The first phase of the plant will come up in 36 months from the date of the signing of the MoU. The land acquisition for the project is in progress. Coal supply will be from the Bramhapuri mines of Chhindwara. The company has also sought support for obtaining coal from Chakha in Jharkhand or Chhattrasal in Madhya Pradesh.
The company has reportedly signed a power purchase agreement with the Madhya Pradesh State Electricity Board and the state government may consider taking 11% equity, with the balance remaining with KSK.
Simplex Infrastructures secures contract from Vedanta
Simplex Infrastructures Ltd has informed that the Company has secured a contract from Vedanta Alumina Ltd worth Rs 792.80 million for civil and structural works of aluminium smelter project at Jharsuguda, Orissa.
TopKandla Port adopts IT to join league of advanced ports
Eximnews has reported that Kandla Port has adopted information technology to join the group of advanced ports worldwide. Online computerization has been initiated to provide expeditious, effective and efficient services to its vast clientele. With the support, cooperation and coordination of various agencies connected with its activities like the Customs Department, banks, Port users etc, KPT is in the final stage of implementation of its online computerization project, which includes various areas such as port operations, finance, land management, hospital management, personnel management, etc.
The spurt of technological advancement recently witnessed in KPT is the net result of the pragmatic and practical approach adopted by the top management headed by its Chairman, Mr A Janardhana Rao, who recognizes the need of the hour and the importance of IT in the day-to-day operations of the Port.
Kalpataru Power reappoints Mr Mani as MD
Kalpataru Power Transmission Ltd has informed BSE that the Board of Directors of the Company at its meeting held on March 31, 2006, on recommendation of Nomination and Compensation Committee, re appointed Mr. KV Mani Managing Director for a term of 2 years wef April 01 2006.
TopArcelor board to increase dividend
Arcelor's Board of Directors met on April 3, 2006 and decided that the Board of Directors of Arcelor will propose at the next General Shareholders Meeting a dividend higher than announced on February 16, 2006. The distributed amount would accordingly be increased from euro 1.20 to euro 1.85 per share.
The Board of Directors announced its intention to distribute a total amount of 5 billion euros to the shareholders coming from group's available cash flow. Such payment, which does not include the dividend payment of euro1.85 and which terms shall be decided later by the Board of Directors, could take the form of a share buyback, an extraordinary dividend payment or a self tender offer in between the date of the annual general meeting on April 28, 2006 and the end of the 12th month following the withdrawal or failure of Mittal Steel's hostile offer on Arcelor.
Arcelor said that "Such modification reflects Arcelor's confidence in its results as well as in its capacity to achieve the value plan presented by its Management Board on last February 27. The amount of euro1.85 dividend per share also matches the goal of a 30% distribution rate of the group's net results for 2005, in line with the announced improvement of dividend distribution policy. This proposal demonstrates the confidence of the Board of Directors in Arcelor's earnings potential."
Mr Gonzalo Urquijo Arcelors CFO said that the companys plan to raise the 2005 dividend payout to 1.85 a share from the 1.20 announced in February, would not affect the companys proposed capital expenditure, including 1.3 billion of plant maintenance, but could have a bearing on other activities. You cant have your cake and eat it too, Mr Urquijo said. But we have created lots of value for shareholders and we want to give back part of this to them. We do want to continue growing, but now its the turn of the shareholders, he said. However Arcelors CFO said that he doubted that these steps would force Mr Mittal to withdraw its bid. Mr Urquijo said I dont think he is going to give up.
Mittal Steel to go ahead with bid
Mittal Steel said on Tuesday that it would press ahead with a hostile takeover bid for Arcelor, after its European rival stepped up defenses. Todays announcement by the board of Arcelor goes against the interests of its own shareholders and is an attempt to deprive them of the right to decide on the merits of Mittal Steels offer, Mittal Steel said in response.
A spokesman said Mittal Steels offer is not dependent on the sale of Dofasco and nothing in this announcement alters our resolve or ability to proceed with our offer."
In terms of the proposed increased dividend, we regard any dividend distributed by Arcelor above 0.80 euros as an advance payment on the cash consideration of our offer, which would be adjusted accordingly Mittal Steel's spokesperson added.
Mittal Steel also reaffirmed plans to cut the cash component of its bid to take account of any 2005 dividend higher than the 80 cents a share which it says the market expected at the time it informally launched its mainly share offer in late January. The spokesperson said the same principle would apply now that the proposed dividend had been increased to 1.85 euros.
Mittal Steels response came in a official statement issued in London.
Stelco's new shares soar 23% on second day of trading
Shares of newly restructured steel maker Stelco Inc soared more than 23% Tuesday on their second day of trading. The stock gained $4.51 to end the day at $24 on the Toronto Stock Exchange. About four million shares of Stelco changed hands in its first two days of trading. The company has about 27.1 basic shares outstanding or 31.3 million on a fully diluted basis.
The shares were issued to Stelco's financiers, creditors and new CEO at $5.50 apiece over the weekend, after the Hamilton based company emerged from bankruptcy protection at midnight last Friday. Average investors weren't able to buy the shares until the open of trading Monday morning, at which point the number of buy orders had already pushed the opening price up to $15. Stelco's previous shares were wiped out by its restructuring and de listed last month.
Stelcos new CEO Mr Rodney Mott, a 30 year industry veteran and former head of International Steel Group in the United States who took the helm of Stelco on Monday, had bought one million shares of the company at $5.50 apiece. At the end of day Tuesday, Mott had booked a paper profit of $18.5 million on his new shares.
Tricap Management Ltd., a Toronto-based restructuring fund controlled by Brookfield Asset Management, former Brascan, had a two day paper profit of about $184 million on its Stelco shares. Tricap arranged a $375 million loan for the restructuring steelmaker. It owned about 9.93 million shares prior to the start of trading Monday.
MEPS forecast on Asian carbon steel prices
MEPS forecasts for flat products have been up rated for the next six months to reflect the improving conditions in the Chinese market. Export business has picked up, easing the pressure on the domestic scene. In contrast, high Chinese exports to neighboring Japan and South Korea have had a detrimental effect on these markets. As a consequence, the overall price gains in the region may not last into the final quarter of 2006.
It is possible that the current up-tick in prices may just be a short term phenomenon in China as customers reacted to tighter market conditions just after real demand started to improve. Higher iron ore prices are likely to keep the pressure for firm steel transaction values in the medium term.
In the long products sector, activity in China and Taiwan is picking up and is likely to stay firm into the short/medium term. Demand in Japan is still slow and will probably remain that way for most of this year. We detect slight prospects of improvement in South Korea but these are not certain.
MEPS forecasts for all long product categories have been up rated, resulting in an improvement in Asian average prices. Price weakness is predicted for the early months of 2007 due to weather conditions and the holiday break in most countries of the region.
Arcelor to tansfer Dofasco shares to S3
Arcelor's Board of Directors met on April 3, 2006 and unanimously resolved to prevent a sale of Dofasco that would be against the interests of Arcelor. Accordingly, effective 3 April 2006, the Arcelor group transferred its shares in Dofasco to an independent Dutch foundation named "Strategic Steel Stichting" (S3). Arcelor will therefore retain full control over Dofasco, including all decision-making power and all economic interest relating to Dofasco, with the exception of any decision to sell Dofasco.
The S3 Board members will have independent control over any decision to sell Dofasco with a view to protecting the interests of Arcelor, its integrity and its stability.S3 will be in place for at least five years unless the S3 Board decides to dissolve it.
Mr Joseph Kinsch, Chairman of the Board of Directors, said, "The acquisition of Dofasco is a key part of our profitable growth strategy and our vision of industry consolidation. We have formed the Strategic Steel Stichting to safeguard the interests of our shareholders, our employees and all our other stakeholders".
Baotou orders a heavy plate mill from SMS Demag
Inner Mongolia Baotou Steel Union Co Ltd of China has awarded an order to SMS Demag Germany to construct a heavy plate rolling mill with an annual capacity of 1.4 million tonnes. The heavy plate mill will utilize the remaining steel capacity of the existing converter shop of 1.5 million tonnes per annum in order to produce high grade plates in the thickness range from 5 to 100 mm with a width of maximum 3700 mm. Production of the first plate will take place in autumn 2007.
The SMS Demag supply scope includes the engineering, the manufacture and supply of the core equipment for the mill stand area and the shear line. The supervision of erection and commissioning, the electrical and automation systems for the profile and flatness control technology package and the technological control systems for the hot plate leveler and the plate cooling system are also included in the scope of supply.
The core units of the initial equipment comprise a four high roughing stand and a four high finishing stand with hydraulic roll gap adjustment as well as CVCPLUS bending and shifting devices for the finishing stand. Laminar plate cooling, a hotplate leveler, the cooling bed, a shear line with cropping shear, side trimming shear and dividing shear, as well as the finishing line, likewise belong to the initial equipment.
SMS Demag AG forms part of the Metallurgical Plant and Rolling Mill
Technology Business Area of the SMS group. SMS GmbH is the holding for a group of companies internationally active in plant construction and mechanical engineering relating to the processing of steel, non ferrous metals and plastics. The group is divided into the Business Areas of Metallurgical Plant and Rolling Mill Technology, Tube, Long Product and Forging Technology and Plastics Technology.
Territory Iron signs MoU with Chinese buyers for its 2007 production
Australian junior resources developer Territory Iron Ltd, which is developing the Frances Creek operation in the Northern Territory and signed a MoU with an undisclosed Chinese customer to sell between 600,000 and 800,000 tonnes of iron ore.
The project is based in the historic mining town of Frances Creek, once home to an iron ore mine that was wiped out by Cyclone Tracy in 1974.If Territory Iron is successful in resuming mining at the project, it will become the NT's only iron ore miner. The majority of iron ore is found in Western Australia. Frances Creek is slated to start producing early next year at an initial output of about 1.5 million tonnes.
Territory Iron MD Mr Doug Stewart said the agreement confirmed there was a market for the mine's product. "This is an important development for the company as we progress to producing iron ore from this historic mine," Mr Stewart said. Mr Stewart said pricing of the agreement had not yet been decided and would be negotiated closer to the beginning of production. "No one will speculate now on what iron ore prices will be like in a year's time," Mr Stewart said. "Everyone's waiting for the current round of contract negotiations between the Chinese and major mining companies to be completed."
Territory Iron is an emerging iron ore producer which has drilled part of the previously mined Frances Creek iron ore mine in the Northern Territory. Since the drilling, feasibility studies have indicated that the project is economic, based on advantages which include local infrastructure, bulk handling facilities being constructed at the Port of Darwin and a well-priced iron ore market.
Samancor sells dense media FeSi business to Siyanda-Inkwali
Samancor Manganese has sold its dense media ferrosilicon business to black economic empowerment company Siyanda-Inkwali Resources for R235 million as per an announcement from Siyanda. The dense media ferrosilicon business is the world's largest producer of milled and atomized ferrosilicon, according to Siyanda's statement. Samancor Manganese's South African manganese mines are located near Hotazel in the Northern Cape and the company also manages the production of dense media ferrosilicon or Dense Media Separation Powders.
Siyanda-Inkwali Resources bought the dense media ferrosilicon business in association with diamond miner De Beers and the National Empowerment Fund Trust, which is a division of the Department of Trade and Industry. Siyanda will own 50% of the equity plus one share of DMSP, De Beers will have a 30% stake and the NEF will own nearly 20%.
Siyanda is a black owned and managed company formed in 2004 by black mining engineers and other black professionals. It is owned by Siyanda Resources, Inkwali Engineering Services, and women's groupings, including Indalo Resources.
BHP Billiton and Anglo American jointly own Samancor Manganese. BHP Billiton has a 60% stake and Anglo a 40% interest. Anglo has been looking to complete the introduction of black economic empowerment at Samancor Manganese South Africa, Anglo said last week.
Coal mine gas blast kills 2 & injures 27 in Liaoning
A gas explosion at a coal mine in northeast China's Liaoning Province killed two workers and injured 27 on Monday. The blast occurred at around 6:50AM at Dahuang coal mine at Huazi township of Dengta city while some 29 miners were working in the mine, according to reports from the local government. One worker was killed at the spot and the other died after being rescued to the ground and receiving emergency treatment.
Provincial and county officials rushed to the site to organize rescue efforts. One of the rescued workers is still in crucial situation and the other 26 are out of danger. An investigation into the cause of the accident is underway.
Strike hits steel mills in Laro Cdenas Mexico
BNamericas has reported that workers with Mexico's mining metalworkers union STMMRM have begun an indefinite strike at four steel plants in Laro Cdenas, Michoac state citing a statement from the union. The strike affects companies Atibsa, Asssa, Sidergica Laro Cdenas Las Truchas (Sicartsa) and Mittal Steel according to the statement. Strikers could stop operations at Laro Cdenas port if there is not a fast response according to the union statement.
The 1,500 strikers allege that Mexican steelmaker Grupo Villacero, which owns Sicartsa, has intruded in the union's internal affairs by trying to create a pro company union, and that the steelmaker is trying to intimidate workers and families, the statement added. Workers are "demanding respect for union autonomy and worker dignity, as well as improvements in safety and hygiene conditions, adequate equipment maintenance and the application of actions to reduce environmental pollution."
The union started nationwide strikes earlier this year in part to support its elected leader Mr Napole Gez when the government reportedly moved to support another union leader alleging that Mr Gez has misused funds.
BlueScope Steel to build two new steel facilities in Indonesia
BlueScope Steel has announced that it will build two new steel facilities in Indonesia at a total cost of about $105 million.
Its Indonesian subsidiary PT BlueScope Steel Indonesia, the only producer of metal coated steel in Indonesia, will construct a steel facility in Cilegon, Banten, at a cost of $101.1 million. BSSI's country VP marketing and solutions Ms Lucia Karina, said that the steel plant in Cilegon would start operating early in 2008 and produce 90,000 tons of metal coated steel and 55,000 tons of color coated steel per year.
Another subsidiary PT Blue Scope Lysaght Indonesia will build a steel facility in Cibitung, West Java at a cost of $3.9 million. The BSLI plant in Cibitung will produce steel roof tiles, and have an annual production capacity of 8,500 tons of welded steel mesh and 4,500 tons of roll formers coated steel. But BSLI's media relations officer Mr Husni A Puspitasari said that it was not yet clear when the Cibitung plant would commence operations.
PSMC Privatization Minister defends sale
Mr Awais Ahmed Khan Leghari Federal Minister for Privatization & Investment and Information Technology said that the price the Privatization Commission has received for the sale of 75% shares of Pakistan Steel Mills Corporation was best possible price that could be attracted. He said that the PSMC had never been profitable in the history, the government had written off the interest on its loans to the PSMC due to which it managed to post profits in the last few years. The privatization would ensure stoppage of government financing loss of around Rs 16 billion every year.
The possible price of 100% shares of PSMC was determined at $500 before its privatization due to its technology of the Seventies with poor financial health and the government has been able to get the best price of $362 million with total net value of the Corporation stood at 482 million.
The government has not included 14.5 thousand acres of land in the privatization transaction and the price of this land is around Rs 50 billion that is still with the government. The Economic Coordination Committee of the Cabinet would take the final decision about this land whether it should remain with the federal government or be handed over to the Sindh government.
CRU & MEPS experts acknowledge peculiarity of IPP
Mr Philip Tomlinson of CRU Strategies, a UK based independent business analysis and consultancy group, called by Mittal Steel SA to give testimony before the Competition Tribunal made admission under cross examination on Tuesday that he had not come across another market internationally where import parity pricing was employed as the basis for setting domestic steel prices. Mr Philip Tomlinson stressed that all markets took into account the reality of imports when establishing a price and that prices in all regions tended, over time, to track a global price, a fact heavily contested by the legal team for Harmony and DRDGold who argued that there was no single international steel market, but rather a series of national or regional markets.
Mr Tomlinson's testimony regarding IPP concurred with that of Mr Peter Fish of MEPS, another UK based steel consultancy, which specializes in steel price analysis, who in his testimony earlier in the proceedings stated that he had never before come across a market where IPP was employed as the basis for setting domestic selling prices. He said that, in the markets MEPS analysed, domestic selling prices were set through a process of negotiation between the producers and consumers based on the prevailing circumstances of the market at the time.
Mr Tomlinson argued that the steel market was a perfectly competitive one, where steel prices would trend towards the long run marginal costs of production. He also argued that import competition would lead price adjustments in cases where there had been a period in regions when the price had traded above the global trend. To support his view, Tomlinson presented a correlation graph showing the South African steel price, over time, against those in key US regions as well as in several European Union countries.
However, lawyers for Harmony and DRDGold contested the theoretical value of the correlation and pointed out material and sustained divergence between prices even in the comparator markets presented by CRU. They also argued that rivalry would be a vital ingredient to ensuring perfectly competitive behavior, while pointing out that Mittal faced little flat-steel competition locally and was naturally protected by virtue of its geographical isolation from other markets.
Smorgon upgrades forecast as scrap soars
Metal recycler Smorgon Steel Group has upgraded its second half guidance and now expects its net profit to be 10% to 15% higher than the first half thanks to a rebound in selling prices. Smorgon said it had locked in higher prices with customers as traditional scrap metal buyers China and Turkey had re-entered the market in a big way.
After reporting a $60.5 million first-half net profit in February, Smorgon said it was expecting a similar result in the second half. It had been looking at a subdued second half due to weakness in sales to the Australian manufacturing sector and lower than expected selling prices for scrap metal. Yesterday it said that prices had rebounded more strongly than expected and it now expected second-half net profit to be 10% to 15% cent greater than the result for the six months to December 31, 2005.
Smorgon executive general manager for corporate and investor relations Mr Bruce Loveday said scrap prices had rebounded much more strongly than the group had expected. "We have actually locked in some sales at those higher prices, we're not just punting that we'll be able to sell material at the higher prices over the next couple of months," Mr Loveday said.
Tenaris to alter ADS conversion ratio
Tenaris SA announced today that its board of directors has approved a proposal to alter the conversion ratio of its American Depositary Shares from the current ratio of one ADS being equal to ten ordinary shares to a new ratio under which one ADS will be equal to two ordinary shares. To effect the ratio change, each holder of ADSs on record at the close of business on April 17 will receive four additional ADSs for each outstanding ADS that he holds on the record date, with the settlement date to occur on April 26. The implementation of this ratio change is subject to all applicable regulatory and stock exchange approvals and procedures. This ratio change relates exclusively to the ADSs listed on the New York Stock Exchange and does not affect the ordinary shares.
Tenaris is a leading global manufacturer of seamless steel pipe products and provider of pipe handling, stocking and distribution services to the oil and gas, energy and mechanical industries and a leading regional supplier of welded steel pipes for gas pipelines in South America. Domiciled in Luxembourg, it has pipe manufacturing facilities in Argentina, Brazil, Canada, Italy, Japan, Mexico, Romania and Venezuela and a network of customer service centers present in over 20 countries worldwide.
Mechel Trading House net profit slumps in 2005
Mechel Trading House posted net profit of 4.13 billion rubles to Russian accounting standards in 2005, down by 51.09% YOY, the company reported. Net profit fell due to an increase in purchase prices for goods, a 4% rise in the share of cost in revenue and a reduction in operating revenue.
However the assets went up by 12.07% to 24.62 billion rubles due to an increase in receivables and long term financial investment.
Mechel Trading House was established in 1997 to coordinate sales for the Mechel steel group in Russia and purchase raw materials for companies within the group.
SCM reports $1.07 billion profits in 2005
System Capital Management, Ukraines largest financial and industrial conglomerate owned by the countrys wealthiest man Mr Rinat Akhmetov, reported $1.07 billion profits on sales of $4.19 billion in 2005, the company said.
SCM said that the released figures for the first time reflect the companys finances based on international reporting standards and had been checked by Price Waterhouse Cooper.
GSHL appoints new CEOs for ZISCO & Kremikovski
Global Steel Holdings has appointed Mr Lalit Kumar Sehgal as CEO of Zimbabwe Iron and Steel Company. Mr Sehgal joined GSHL after retiring from SAIL, where he worked at Bokaro and Bhilai steel plants. He moved to Zimbabwe after his stint in Nigeria as CEO of Delta Steel Company and Ajakouta Steel.
Global Infrastructures, a subsidiary of GSHL, had entered into a deal with the Zimbabwe government for taking over management control of ZISCO for 20 years and is estimated to have invested $400 million in ZISCO. GSHL had acquired management control of ZISCO last month.
GSHL has also appointed Mr Vilas Jamni as CEO of its operations in Bulgaria. Mr Jamni had earlier held the position of COO of Ispat Industrys plant in Dolvi Maharashtra and subsequently he had moved to head global operations at GSHL.
GSHLs wholly owned subsidiary Finmetal holds 71% in the countrys largest steel plant Kremikovski.
Steel Technologies completes sale of Custom Steel
Steel Technologies Inc announced that it has completed the previously announced sale of its Custom Steel Inc to American Railcar Industries, Inc. Proceeds from the sale totaled approximately $18 million, including approximately $5 million for inventories. Steel Technologies intends to use $13 million of this amount to reduce indebtedness under its revolving credit agreement. The remainder will be used for general corporate purposes.
The Custom Steel facility in Kennett, Missouri, produces fabricated parts that primarily support ARI's nearby railcar manufacturing operations.
Steel Technologies processes flat rolled steel to specific thickness, width, temper, finish and shape requirements for automotive, appliance, lawn and garden, office furniture, agriculture, construction, hardware, and consumer goods. The Company has 19 facilities, including its joint venture operations, located throughout the United States and Mexico.
Harris Steel closes acquisition of Tru-Weld Grating
Harris Steel Group Inc has announced the closing of the acquisition of the business and assets of Tru-Weld Grating Inc. and its Canadian subsidiary Tru-Weld Grating Ltd. The signing of a definitive agreement to acquire the Tru-Weld business and assets was announced March 15, 2006. A breakdown of the purchase consideration will be provided in the notes to the consolidated financials for the quarter ending June 30, 2006.
Harris Steel Group Inc. is engaged in the fabrication and placing of concrete reinforcing steel including epoxy coated reinforcing steel, the design and installation of concrete post tensioning systems, the manufacture and distribution of wire and wire products, cold finished bar, and the manufacture and distribution of heavy industrial steel and aluminum grating throughout Canada and the United States. Harris Steel Group also participates in steel trading on a worldwide basis, and in the distribution of reinforcing steel and allied products to US customers, primarily involved in single family residential construction.
Ivanhoe Mines receives proceeds for sale of Savage river Iron Ore mine
Ivanhoe Mines Ltd announced that it has received its first contingent annual payment totaling $28 million, from the sale of the Savage River iron ore mine in Australia, bringing the total payments received to date to $49.5 million.
Ivanhoe Mines sold the Savage River mine to a subsidiary of Stemcor Holdings Limited of UK in February 2005. The purchase price consisted of two initial payments totaling $21.5 million, which Ivanhoe has now received, plus a series of contingent, escalating scale annual payments based on the annual Nibrasco -Japanese Steel Mills pellet price to be made over five years, beginning March, 2006.
Black Butte Coal mine seeks expansion
According to USs Bureau of Land Management Black Butte Coal Co. has asked the agency to lease federal coal within an adjacent tract of BLM land to support further surface mining at the company's mine in Sweetwater County in southwest Wyoming. BLM is proposing to accept the company's lease application and offer the 1,400-acre tract of coal for lease sale and assumes that the successful bidder would be Black Butte Coal. The BLM recently issued a draft environmental impact statement on the proposal for public review.
The BLM study estimated that 34.6 million tons of coal reserves are present with the project area, which is located about 28 miles southeast of Rock Springs. The tract is known as Pit 14. The company estimates the average annual coal production would be from 1.5 million to 3 million tons of coal over about 20 years.
Black Butte Coal Co. is owned jointly by Anadarko and Level 3 Communications and is operated and managed by Kiewit Mining Group, a subsidiary of Peter Kiewit and Sons Inc. of Omaha. Black Butte Coal was established in 1974 near Point of Rocks. The operation is one of the largest surface coal mines in the country, covering more than 70 square miles, according to company data.
