On June 2, Egypt's largest steel producer Ezz Steel announced its financial results for the first quarter of 2010.
According to a statement released by the company, in the first quarter of 2010 Ezz Steel's net profit after tax rose by 78 percent to EGP 105 million ($18.53 million) from EGP 59 million in Q1 2009.
Meanwhile, the company's consolidated net sales in the first quarter of 2010 were EGP 3.4 billion ($600.1 million) remaining unchanged as compared to the first quarter of 2009.
The producer's long steel sales volume reached 853,000 mt in the first quarter of 2010, up one percent over the 847,000 mt sold during the same period in 2009, to meet continued strong domestic demand for long products. On the other hand, flat steel sales increased nine percent year on year, reaching 227,000 metric tons.
Long steel products accounted for 76 percent of Ezz Steel's total sales in the first quarter of 2010, in comparison to 81 percent for the first quarter of 2009, while flat steel products represented 22 percent of sales in the first quarter of 2010.
Commenting on the results, Ezz Steel managing director Paul Chekaiban said, "Following a difficult 2009, we have witnessed a slight improvement in the levels of demand and steel prices both globally and in the domestic market, during the first quarter of 2010. This has translated into higher margins, thanks to our efficient processes and vertical integration, leading consequently to better profitability. Under these circumstances, we took all measures in order to ensure EFS [i.e., Ezz Steel's flat steel plant] returned to full production as of April 1, 2010. We therefore remain positive about the outlook for the rest of the year."
The company said that it is confident about the strength of the Egyptian market, with long product demand expected to continue to be strong, due to the private housing market and local real estate activity. Ezz Steel sees a step up in the demand for flat steel as conditions in the global flat steel market improve, and sustained improvement evidenced by the increase in flat steel prices.