Wuhan Iron and Steel Company (WISCO) and Angang Steel Company disclosed their semi-annual reports, reports www.cnchemicals.com, citing a company filing.
WISCO posted a 14.73 percent year-on-year increase in net profit to 1.226 billion yuan in the first half of 2011, with earnings per share (EPS) of 0.125 yuan, up 11.61 percent. Sales revenue grew 23.22 percent year-on-year to 50.82 billion yuan, of which iron production grew 10.98 percent to 8.47 million tons; production of steel climbed 10.45 percent to 8.88 million tons, and production volume of other building material increased 13.57 percent to 8.29 million tons in its major plant.
Angang Steel posted a 92-percent year-on-year decrease in net profit to 220 million yuan, with EPS of 0.03 yuan, down 92.11 percent. The company attributed the decrease in net profit to higher raw material prices.
Some industry insiders pointed out that China's current pricing mechanism, which asks steel producers setting prices based the spot price, is inappropriate, resulting in narrower profit. Also, the high price of coke coal and waste steel hinder steel makers from making profits