Tokyo Steel Posts Recurring Loss in April-June

Tokyo Steel Manufacturing announced on Wednesday the firm posted 1.066 billion yen of recurring loss for April-June, which represents loss for 4 quarters in a row, due to higher raw materials cost and lower steel selling price. The firm expects to regain profitability in July-September due to lower ferrous scrap cost.

The firm posted recurring loss for April-June when the averaged steel selling price increased by 2,700 yen to 70,500 yen per tonne from same period of 2009 while the scrap cost increased by around 20,000 yen to 38,000 yen. The firm posted 1.768 billion yen of net loss with 47.6% higher sales at 39.164 billion yen.

The steel sales volume increased by 42.3% to 555,000 tonnes in April-June from same period of 2009. The export was 33,000 tonnes or 5.6% of the sales volume. The firm expects the steel sales volume is 1.2 million tonnes in the first half and 1.6 million tonnes in the second half. The firm estimates the flat rolled weight is near 60% due to higher operation rate at new Tahara plant while the flat rolled steel was 55%.

The firm revised the outlook for half year and full year. The firm now expects 1.7 billion yen of operating profit and 1.8 billion yen of recurring profit with 80 billion yen of sales for the first half compared with original 90 billion yen of sales, 1.2 billion yen of operating profit and 1.2 billion yen of operating profit. The firm expects 6 billion yen of operating profit and 6.1 billion yen of recurring profit with 187 billion yen of sales for the year ending March 2011 compared with original 5.5 billion yen of operating profit and recurring profit and 210 billion yen of sales. The firm left the net profit target at 5 billion yen.