According to the official statement issued by Turkish integrated steelmaker Erdemir, during the first nine months of the current year, the company's net profit increased by 154 percent to TRY 1.4588 million ($1.1963 million) compared to the first nine months of 2007. The company has also upped its net profit margin by 12 percent points to 225.1 percent compared to the corresponding period of last year. It is reported that the profit achieved in the first nine months of 2008 is the highest consolidated profit ever recorded in Erdemir Group's history.
According to Erdemir, in the first nine months of 2008 a seven percent increase was registered in sales costs on the back of the significant surge in raw material procurement prices, in particular for coal, coke and iron ore. Despite this, during the nine month period, Erdemir increased its consolidated sales revenue by 39 percent year on year to TRY 5.8024 million ($4.7584 million) thanks to the positive developments in the flats and longs markets, as well as the commissioning of new investments at the company's Eregli and Iskenderun works. Erdemir has also raised its operational profit by 195 percent to TRY 1.9478 million ($1.5973 million) and has increased its operational profit margin by 18 percent points to 33.6 percent, compared to the corresponding period of 2007.
Meanwhile, the Group has upped its EBITDA by 135 percent to TRY 2.2482 million ($1.8437 million) and its EBITDA margin to 38 percent, both compared to the corresponding period of last year.
During the first nine months of 2008, Eregli works increased its flats production by more than 12 percent from the same period of last year. Of the total 3,435,000 mt of flats production, 1,326,000 mt consisted of cold rolled, while 2,109,000 mt were hot rolled. Meanwhile, including slab production, Iskenderun works produced a total of 2,411,000 mt of steel products - up by 29 percent year on year.
Erdemir general manager and board member, Oguz N. Ozgen, commented that the global financial crisis started to show its impact on the Turkish steel sector from August 2008, adding, "Due to the slowdown in markets registered in the last half of Q3 2008, our flats production decreased by 13 percent at the Eregli works and by 15 percent at the Iskenderun works, both compared to Q2 of the current year. We have temporarily rolled back the capacity utilization rate of our facilities, in a response to the fluctuation in demand. The quick reaction of Erdemir Group to the rapidly changing market conditions reflects the company's managerial dynamism developed in the recent three years."