Nisshin Steel’s Recurring Profit Declines for Oct-Dec 2010

Nisshin Steel announced on Thursday its consolidated recurring profit decreased by 1.6 billion yen to 4.6 billion yen for October-December 2010 from the same period of fiscal 2009. Compared with the previous quarter, the profit downed by 5.5 billion yen. For nine months of April-December 2010, the consolidated recurring profit improved to 16.3 billion yen from 58.9 billion yen loss in the same period of fiscal 2009. However, the firm set full-year recurring profit forecast unchanged at 18 billion yen. Full-year net profit outlook was revised down by 1 billion yen to 12 billion yen due to reversal of deferred tax assets for conventional reduced cooperate tax.

For October-December, the sales volume decreased by 80,000 tonnes to 840,000 tonnes from the previous quarter. Average sales price increased by 1,000 yen to 125,000 yen per tonne. On the other hand, raw material cost upped by carryover of raw materials from July-September.

The sales volume is expected to increase by 40,000 tonnes to 880,000 tonnes for January-March from October-December. Average sales price would lower by 1,000 yen mainly due to product mix. Quarter recurring profit is estimated at around 1.7 billion yen due to raw material cost up.

Nisshin Steel outlooks the recurring profit downs by 5.4 billion yen to 6.3 billion yen for six months of October-March from the first half year. The profit is expected to improve by 12 billion yen thanks to cost reduction and sales price improvement while worsen by 17 billion yen because of raw material cost upsurge and inventory valuation loss.