China Steel says Aug. sales top NT$16.8 bil.
The China Post news staffChina Steel, Taiwan's largest steelmaker, yesterday reported August sales of NT$16.829 billion, a decline of 7.08 percent from July due to slow orders from downstream operators, thus promoting the idea that the company should reduce capacity.
September 6, 2012, 11:36 am TWN
The figure was the lowest this year for the steelmaker, which still managed to turn a pre-tax profit of NT$712 million in August, a rise of 1.04 percent from July, on the firm's effort to control cost.
On a year-on-year basis, however, the NT$712 million was a decline of 60 percent from August 2011. For the first eight months, China Steel had earnings per share of NT$0.22.
The company recently announced a 5-percent reduction in October and November wholesale prices, which were met with unenthusiastic responses from downstream clients. Yet the firm expects orders to pick up in the fourth quarter compared to the third.
China Steel sold 716,000 tons of carbon steel in August, of which 68 percent was sold domestically and over 30 percent sold overseas. With orders from downstream clients showing sluggishness, China Steel reduced capacity utilization to 80 percent.
The firm's active cost-control measures enabled it to post a 30-percent increase in August operating profit from July, despite the fact sales and average price both declined last month.
Experts have expressed optimism for the firm's cost control measures down the road, given China Steel is expected to purchase coal, iron and other raw materials at even lower prices in the fourth quarter, they said.