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Taiwan's CSC Sees Jan.-Nov. Consolidated Revenue Decline by 3.42% to NT$318.716 Bn.

2013/12/11 | By Steve Chuang

Affected by oversupply amid slow market demand worldwide, Taiwan-based China Steel Corp. (CSC), the largest steelmaker by both output and revenue on the island, reported consolidated revenue of NT$318.716 billion for the first 11 months, down 3.42% year-on-year (YoY), according to the firm's latest financial statement.

In November when nominal prices of its domestically sold steels were raised by NT$379 per tonne on average, the firm's sales volume shrank by nearly 100,000 tonnes to only around 750,000 tonnes compared to October, mostly due to periodical furnace maintenance, leading to its monthly consolidated revenue declining  3.64% month-on-month to NT$28.609 billion, up 2.74% YoY.

The firm's pretax profits for November are estimated at nearly NT$2 billion, or some NT$22 billion for Jan.-Nov., for  NT$1.42 per share, according to institutional investors.

After weathering a shaky market this year, the company's chairman Tsou Juo-chi opines that the global steel market is very likely to increasingly stabilize next year for a couple of reasons.

Tsou pointed to the recent price hikes announced by Baosteel Group Corp., the biggest steelmaker in China, as one signal of market recovery among others. The Chinese steelmaker has decided to generally raise prices of its steels, excluding electrical steel sheets, by RMB50 per tonne for next January to lead the industry, which will surely trigger a new round of price hikes among global steelmakers.

Other positive factors driving Tsou's optimism for 2014 include the relief of U.S.'s fiscal cliff; diminishing negative effects of the tapering of QE3; an ongoing turnaround of the European economy; the decreasing possibility of China's economic soft landing; the ongoing post-quake reconstruction in Japan along with the Abenomics paying off; and persistently growing market demand in Southeast Asian nations and India.

More notable is that CSC confirmed its orders received till early December from domestic customers for next January and February were only 0.5% shy of its goal, which helps boost the chairman's confidence in rosy performance in the first quarter of next year, despite a low season. (SC)

CSC's Consolidated Revenue in 2013 by Month
Month Consolidated Revenue
April

NT$29.628 Bn.

May

NT$29.192 Bn.

June

NT$25.875 Bn.

July

NT$29.445 Bn.

August

NT$29.105 Bn.

September

NT$28.709 Bn.

October

NT$29.690 Bn.

November

NT$28.609 Bn.

Source: Market Observation Post System