Wed, May 02, 2018 - Page 12 News List

CSC reports net profit rose 6%

FIRST-QUARTER RESULTS:Revenue grew 13 percent annually to NT$93.39 billion, but the firm said rising material costs meant operating income fell to NT$6.04 billion

By Kuo Chia-erh  /  Staff reporter

China Steel Corp (CSC, 中鋼) on Monday reported that pretax net profit last quarter grew 6 percent year-on-year from NT$5.39 billion to NT$5.74 billion (US$182.06 million to US$193.89 million), due mainly to robust client demand and growing non-operating income.

Revenue rose 13 percent annually from NT$82.98 billion to NT$93.39 billion, the nation’s largest steelmaker said in a statement.

However, operating income slid 6 percent from NT$6.43 billion a year earlier to NT$6.04 billion, as recent price adjustments could not fully reflect increasing material costs.

The Kaohsiung-headquartered company raised prices NT$327, or 1.5 percent, for domestic shipments in the first quarter to reflect an uptrend in international steel prices.

Shipments last quarter totaled 2.7 million tonnes, it said.

CSC also raised domestic product prices for this quarter’s deliveries an average of NT$914 per tonne, an increase of 4.2 percent, it said.

The government-backed firm, whose major shareholders include the Ministry of Economic Affairs, has been pouring capital into the development of offshore wind energy business over the past few years.

It has been awarded a government contract to build an offshore wind farm with a capacity of 300 megawatts through an alliance with Copenhagen Infrastructure Partners as part of the government’s plan to boost capacity from renewable energy sources.

In addition to setting up its own wind farm, CSC is also exploring offshore energy industry opportunities in emerging markets.

It signed preferred supplier agreements in March with Denmark-based MHI Vestas Offshore Wind, a joint venture between Denmark’s Vestas Wind Systems A/S and Japan’s Mitsubishi Heavy Industries Ltd.

MHI Vestas also signed memorandums of understanding with some benchmark Taiwanese suppliers, including China Steel Machinery Corp (中鋼機械), Swancor Holding Co Ltd (上緯) and Formosa Plastics Corp (台灣塑膠).

CSC is building a plant in Singda Harbor (興達港), Kaohsiung, to manufacture undersea foundations for offshore wind turbines to create a local supply chain for wind turbines.

The firm’s board has approved a proposal to invest NT$3.42 billion to establish a subsidiary to take charge of the Singda plant’s construction.

China Steel has budgeted nearly NT$6 billion over the next few years to build the production lines at the plant, which is scheduled to begin operations by the end of next year.

CSC shares on Monday edged up 0.43 percent to close at NT$23.5 in Taipei trading.

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