By Yuka Obayashi
TOKYO, Aug 4 (Reuters) – Japan’s top steelmaker Nippon Steel on Tuesday raised its full-year net profit forecast by 32% to 290 billion yen ($1.84 billion), citing stronger earnings at U.S. Steel amid a firmer U.S. steel market.
• Nippon Steel posted a 75.30 billion yen net profit for the April-June first quarter, compared with a 195.83 billion yen net loss a year earlier, when it booked a hefty one-off loss related to the sale of its stake in the AM/NS Calvert joint venture.
• “U.S. Steel drove our group earnings,” Nippon Steel Chief Financial Officer Takahiko Iwai told a news conference, adding that measures to improve quality and operational efficiencies at U.S. Steel after its acquisition also contributed to higher profits at the U.S. unit.
• Nippon Steel raised its underlying business profit forecast for U.S. Steel in the financial year to March 2027 to 180 billion yen or more, from its May prediction of 100 billion yen or more.
• It also raised its full-year assumption for the U.S. hot-rolled coil market by $100 to $1,000-$1,100 per short ton in light of the recent rise in prices.
• CFO Iwai said an expected increase in inventory valuation gains, driven by the weak yen against the U.S. dollar and rising raw material costs, also contributed to the upward revision of the profit forecast.
• Meanwhile, the Middle East conflict reduced first-quarter earnings by 25 billion yen and is expected to have a 60 billion yen negative impact for the full year, Iwai said.
• As profits from domestic operations remain stagnant, Nippon Steel aims to pass on higher raw material and fuel costs to customers going forward, Iwai said. “The Japanese government has finally imposed anti-dumping measures,” he said, adding that if measures can help curb imports of cheap steel, it may become possible to see stronger domestic prices.
($1 = 157.7800 yen
(Reporting by Yuka Obayashi; Editing by Rashmi Aich)
Comments