Baosteel's net profit up 35%

SteelOrbis Shanghai Baosteel's annals published yesterday show that its 2005 sales revenue increased 116 percent year on year to RMB 126.61 billion ($15.767 billion), with RMB 12.67 billion ($1.578 billion) net profits, up 35 percent year on year. Baosteel's income per share is at RMB 0.72 ($0.09), roughly in line with the market expectation. According to the annals, Baosteel sold 18.79 million metric tons of semi finished products, up 62.08 percent year on year. However, its profit margin been reduced to 21 percent in 2005 from the 29.3 percent in 2004. This is mainly due to the 141.3 percent increase in its operation cost, which was higher than the increase in operation revenue. At the end of April 2005, Baosteel issued additional five billion shares to purchase the assets of iron and steel making and supply section. After the purchase, the crude steel production capacity of the company reached 20 million metric tons, and the company has also formed a manufacturing system that includes the production of common carbon steel, stainless steel and specialty steel. The product range varies from steel for automobile, household appliances, to seamless pipes.