China Oriental reports decrease in its profit

China Oriental reports decrease in its profit

According to recent news in the market, Chinese billet supplier China Oriental Group reported a 34% decrease in the first half of current fiscal year due to the rise in raw material prices. Net profit of the company has been recorded as Yuan 441 million ($53.2 million) against Yuan 590 million ($71.2 million) recorded in the corresponding period of 2003. On the other hand, turnover of the company has increased by 101.2% to Yuan 4.094 billion ($494.6 million). Moreover, sales volume has increased by 52% to 1.57 million tons. Company's billet price, excluding VAT increased by 35.8% to Yuan 2'578 ($311) per ton and the strip price by 25.8% to Yuan 2'672 ($323) per ton in the first six months of 2004. However, costs of these products increased by 73.8% and 66.7% respectively. Meanwhile, the company plans to invest Yuan 1.3 billion ($157 million) to establish a H-section line with an annual capacity of 1 million tons in order to expand its profit. The company expects the H-section line to increase its profit as the product faces less market competition.