Baosteel cuts in the fourth quarter or temporary loss - Baoshan Iron & Steel, iron and steel products, iron and steel industry - steel industr

Baosteel cuts in the fourth quarter or temporary loss - Baoshan Iron & Steel

, iron and steel products, iron and steel industry - steel industr

Vice President, Secretary of the Board Chen Ying-line performance in the third quarter note, noted that demand for steel products since the fourth quarter, a sharp decline in the fourth quarter, Baosteel will face enormous pressure, possible loss of carbon steel products. Medium-term adjustment of the steel industry has already begun, Baosteel next year to maintain the level of performance this year is very difficult.

Possible loss in the fourth quarter

Chen Ying said that given the difficult business situation in the fourth quarter, fourth quarter may be a loss.

Three quarterly, this year's third quarter net profit of 2.846 billion yuan, up 19.15% over last year. However, in the third quarter showed a downward trend in domestic steel prices, while costs for new mines ore rises in full expression, so that Baosteel's net assets yield rate of 10.10% from the first half fell to 2.90% this quarter.

Baosteel in the third quarter report that the steel industry to face adverse situation, coupled with high operating costs and other business situation, is expected to be difficult to change in the short term, as well as the global economic situation is not optimistic expectations, the company in the fourth quarter and the first quarter of next year, will face more severe challenges.

Industry analysts generally agreed that, due to overcapacity in steel prices next year may only cost a balanced line. Ore spot and contract prices for more recent, large cost advantage of steel is no longer significant, which means that the profitability of large steel mill will mainly depend on the product strength, not a cost advantage, which means that profits have fallen significantly.

Not consider the recent share repurchase

For the stock market downturn, especially in the steel plate industry price-earnings ratio stocks mostly lower than 5 times, even below the net value of more than 10 stocks, including shares of Angang Steel Group, including holdings of major shareholders are doing.

For Baosteel Group to consider whether the holdings of major shareholders, the Baosteel said the parent company Baosteel Group is studying and discussing matters relating to holdings of shares in listed companies, but Baosteel will not consider the recent share repurchases. Cui Jian, deputy general manager

Baosteel said in describing the meeting, on overweight, Baosteel Group is to study and discuss the matter; for the repurchase, on the one hand the recent steel industry management situation is grim, the company did not have a lot of idle funds ; the other hand, the relevant provisions under the current repurchase shares only for cancellation will result in reduction of registered capital, shareholders, and creditors need to convene the meeting, will be the system the company is facing some obstacles and legal risk, so yet taken into account.

Not rule out the possible production cuts

Cui Jian on the Baosteel and future profitability next year, are described. He said the company's future earnings influenced by the macro environment, there is uncertainty. Baosteel may lower costs through steel prices fell sharply against the current limited production shutdown no specific plan, but does not exclude possible cut.

Secretary of the Board and Chief Financial Officer Chen Ying said that the merger and reorganization of the steel industry's development trend, but also the requirements of China's steel industry policy, Baosteel to achieve leapfrog development, will be at the right time and to consider the possible conditions, to accelerate the domestic steel industry mergers and acquisitions work.

Yesterday, CISA vice chairman Luo Bingsheng said that from January to September this year, Chinese steel production has remained high-cost running into the statistics of large and medium steel companies representative of the steel-making pig iron production costs increased by 63.55 year on year %, while steel prices fell across the row.

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