Nippon Steel Announces Downward Revision to Full Fiscal Profit Estimates

SEATTLE (Scrap Monster): Leading Japanese steelmaker Nippon Steel & Sumitomo Metal Corp announced results for the third quarter of Fiscal 2018.

The company posted growth in profits and sales during the quarter when compared with the same quarter of fiscal 2017. The net operating profit improved to ¥150.7 billion, whereas the net sales surged higher to touch ¥4,519.1 billion.

The steelmaking and steel fabrication segment reported stable performance during the quarter, primarily on account of strong shipments to the automotive sector and rising overseas steel demand. Although domestic prices maintained high levels, prices witnessed decline in overseas markets. The series of natural disasters including heavy rainfall and typhoon also impacted the company’s operations during the quarter. Overall, the segment’s net sales totaled ¥3,987.0 billion, with ordinary profits rising to ¥212.5 billion.

Nippon Steel reduced its annual crude steel output estimates for the full financial year ending March 31, 2019 from 42.1 million tonnes (Mt) to 41.3 Mt. The downward revision in yearly output is mainly on account of troubles at its mills. Nippon Steel Executive Vice President Katsuhiro Miyamoto also stated that the higher iron ore prices are most likely to impact earnings in next financial year.

Also, the company expects 6% drop in annual profits, as compared with earlier estimates. As per revised estimate, the annual profit is likely to total 330 billion yen, down from its earlier guidance of 350 billion yen.

It must be noted that JFE Steel and Kobe Steel too had recently announced downward revision to profits during the full fiscal year.