Updated: 2013-04-01 (chinadaily.com.cn) - Baoshan Iron and Steel Co Ltd, known as Baosteel, the nation's largest listed steel maker, has shown its resilience amid the economic slowdown after posting a 10.39 billion yuan (1.65 billion) net profit in the 2012 fiscal year, the Shanghai-based company said on March 30.
During the reporting period, Baosteel generated 191.5 billion yuan in revenue, down 14 percent year-on-year. The decrease is mainly due to the divestment of stainless steel and special steel assets, as well as the closure of its Luojing factory.
But the steel maker still maintains solid profitability, with its net income surging 41.1 percent year-on-year to 10.39 billion yuan, according to the annual report.
Baosteel's huge profit is in stark contrast with its loss-making peers. On the same day, Shandong Iron and Steel Co Ltd reported a net loss of 3.8 billion yuan for 2012, while in earlier reports, Liaoning-based Angang Steel Co Ltd and Anhui-based Magang (Group) Holding Co Ltd booked net losses of 4.16 billion yuan and 3.86 billion yuan, respectively, due to slumping downstream demand and soaring operating costs.
Baosteel has an upbeat outlook toward 2013 as it believes the industrial environment will improve from its nadir in 2012, and the government's urbanization, go-west and developing advanced manufacturing strategies will ensure steady demand for the steel industry.
However, faced with the slower demand from downstream industries, rising raw material costs, and overcapacity, the steel industry is expected to see meager profit for quite a long period.