August 24, 2017 / 11:04 AM / in a year

UPDATE 1-China's Baoshan H1 profit hits highest in 5 years

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BEIJING, Aug 24 (Reuters) - China’s largest steel listed producer Baoshan Iron and Steel Co Ltd, known as Baosteel, reported a 65 percent surge in net profit in the first half of the year thanks to soaring prices and better-than-expected summer demand.

The company posted a net profit of 6.2 billion yuan ($930.86 million) for the six months, up from 3.68 billion yuan in the same period last year.

That is the best six-month profit since at least the second half of 2012. Its revenue rose 106.6 percent to 169.93 yuan from a year earlier.

Demand for steel products from infrastructure, property markets and the car industry has been better than expected, even during the summer which is typically a low season due to hot weather across the country.

Baosteel acquired Wuhan Iron and Steel as part of a government effort to make bloated industries efficient. The deal was completed in the first quarter.

The combined group reported 8.66 billion yuan profits in the first half of this year, with crude steel output rising 11.5 percent on same period last year.

Steel rebar prices jumped 20 percent in the second quarter and have since extended those gains, hitting 4-1/2-year highs earlier this month amid concerns about Beijing’s efforts to cut outdated capacity and curb low-end steel output would tighten supplies in the world’s top producer. ($1 = 6.6605 Chinese yuan renminbi) (Reporting by Muyu Xu and Josephine Mason; Editing by Keith Weir)

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