SHANGHAI, Apr. 2 (SMM) – According to the annual report of Inner Mongolia Baotou Steel Rare-Earth (Group) Hi-tech (hereinafter referred to as Baotou Steel Rare-Earth), the company’s profits declined nearly 57% YoY to RMB 1.51 billion in 2012, due largely to shrinking demand from slowing economy. The company lowered its sales target for this year by as much as nearly 20% out of growing pessimism over outlook for rare earth.
Baotou Steel Rare-Earth reported RMB 9.24 billion in operating revenues last year, down 19.83%, and RMB 1.51 billion in net profits, also down 56.58%. Earnings per share were a mere RMB 0.624, markedly down from RMB 1.436 in 2011.
The company explained that rare earth market was depressing throughout 2012, accompanied by falling prices. Sales of rare earth metals slumped due to poor orders from magnetic material producers, resulting in a 47.18% decline in the company’s operating revenues in this segment.
The rare earth market has shown no signs of turning around. Prices for rare earth products slid 35% YoY in early 2013. Plagued by sluggish rare earth markets, Baotou Steel Rare-Earth, a leading rare earth producer, has set itself a target of achieving RMB 7.5 billion in sales revenues in 2013, down 18.85% from last year’s RMB 9.24 billon.
The company says it will step up integration and restructuring of rare earth industry in Inner Mongolia. Besides, it will vigorously push ahead with alliance of producers in Gansu, Sichuan and Shandong to pave way for its establishment of China North Rare Earth Group. (Edited by SMM)