Nisshin Steel announced on Friday the firm forecasts its consolidated recurring profit for a full year of fiscal 2011 ending in March 2012 increases by 29.5% to 24 billion yen compared with the previous financial year. The recurring profit forecast for the first half of fiscal 2011 (April-September 2011) is forecasted to decrease by 23.4% year-on-year to 9 billion yen while the profit is expected to improve to 15 billion yen in the second half year. The 3-month recurring profit for April-June was 3.4 billion yen, improving by 2.1 times year-on-year.For April-June, the total sales volume decreased by 7.6% year-on-year to 850,000 tonnes mainly due to negative impacts by Japan Earthquake. The sales of stainless steels decreased by 7.7% to 120,000 tonnes. In addition, the profitability worsened by raw material cost expansion and insufficient selling price improvement. Meanwhile, Nisshin Steel has progressed total cost reduction and new demand cultivation. Moreover, the subsidiaries’ sales and profits improved. Thus the 3-month recurring profit almost doubled from 1.6 billion yen for April-June 2010 and improved by 50% from 2.2 billion yen for January-March 2011. The average steel selling price for April-June 2011 was 129,000 yen per tonne, increasing only by 5,000 yen year-on-year. For July-September, the total sales volume is forecasted to increase to 880,000 tonnes. The sales volume of stainless steels is estimated at 130,000 tonnes. The average selling price is expected to approach 134,000 yen since the price hike offers could be approved by large-lot steel customers. The 3-month recurring profit is estimated at 5.6 billion yen for July-September and 1 billion yen for stainless steels. In the second half of fiscal 2011, steel demand is expected to upturn. Nisshin Steel’s crude steel production is planned at 1.5-2.0 million tonnes, increasing by 5% from the first half year.
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