According to analysts, Brazil's second-biggest steelmaker and biggest flat steel producer, Usiminas, is expected to announce a large drop in Q2 profits as the company's sales have remained low in relation to its costs.
The analysts say that Usiminas' second quarter performance will be impacted negatively because domestic steel prices in the quarter remained low, inventory costs and charges in relation to layoffs have been high, as was the cost to idle three of its five blast furnaces.
According to the average prediction from six Reuters analysts, Usiminas' net income for Q2 will be around 241.44 million reais (US$127.4 million), when last year the company's profit during the same quarter totaled 861 million reais.
While the firm is expected to report that sales grew by 15 to 17 percent in the quarter, the abovementioned costs are expected to dampen earnings.