Japanese major 11 electric furnace steel makers posted lower profit for April-June compared with record level in April-June 2005 due to higher cost for ferrous scrap and energy, according to their results announced by Friday. Their recurring profit on sales decreased by 3.2 percentage points to average 17.9% for 10 makers other than Asahi Industries, which didn’t disclose the results for same period of 2005. Tokyo Tekko and Tokyo Kohtetsu improved the ratio while 8 firms reduced the ratio. They are expected to keep the favorable profitability for the full year to March 2007 when building demand is firm nationwide and the makers try to increase the selling price.Topy Industries posted 8.1% lower recurring profit with 6.9% higher sales for April-June from same period of 2005 on Friday due to higher raw materials cost. The steel unit’s sales increased by 6.4% to 21.98 billion yen. Hokuetsu Metal reported the recurring profit dropped by 22.2% due to higher raw materials cost while the sales increased by 7.4% with higher sales volume. The 11 makers kept the sales level for April-June as same period of 2005 when they kept the selling price and most o them increased the sales volume. Many of them reduced the profit due to the smaller margin when ferrous scrap price was higher than last year and other raw materials and energy cost increased. The recurring profit for sales was as high as near 18% and the ratio was higher than other industries.
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