Belo Horizonte, Brazil-based flat-rolled steelmaker Usinas Siderurgicas de Minas Gerais SA (Usiminas) announced Thursday that its Q1 2011 net income of R$16 million (US$10 million) fell 96 percent from its R$375.2 million (US$237.3 million) net income in the comparable quarter last year.
According to Usiminas executives, the main source of the decline was higher input costs and stagnant domestic steel prices in Brazil that did not reflect price increases. Additionally, Usiminas' lack of its own iron ore and coal supply put added pressure on overall costs and profits.
Over the same period a year ago, exports slumped 7 percent while sales within Brazil, which regularly account for 80 of Usiminas' total production, only edged up slightly.
Net income in Q1 2011 reached the lowest level since Q1 2009.