Japan: Tokyo Steel posts strong financial results for April-June 2023

Tokyo Steel's non-consolidated financial results for the period of April-June 2023 showed strong growth, with net sales up by 13.4% y-o-y to JPY 102.76 billion, operating income up by 69.9% y-o-y to JPY 12.29 billion ($0.09 billion), and net income up by 29.9% y-o-y to JPY 8.85 billion ($0.06 billion).

The company's strong performance was driven by a number of factors, including:

• Higher product shipment unit prices, which exceeded expectations and remained at a level exceeding JPY 110,000/t ($ 780/t) following the previous year.
  
  
• Wider metal spreads, due to lower-than-expected purchase prices for steel scrap raw materials.
  
  
• Reductions in fixed costs due to improved plant utilisation rates.
  
  

Steel sales volume in April-June was 889,000 tonnes (t), up 100,000 t y-o-y and the highest ever. Exports amounted to 214,000 t, up 43,000 t y-o-y.

The sales ratio (volume basis) by product type was 42% for steel bars (39% for shaped steel and 3% for steel bars), down 5% y-o-y. Sales of steel sheets increased 5% y-o-y to 58% (47% for thin sheets and 11% for thick plates), with the growth rate of thin sheets being high.

The unit sales price of steel products in April-June was JPY 113,400/t ($ 804/t), up JPY 100/t ($ 0.71/t) from the same period last year. The purchase price of steel scrap was JPY 51,900/t ($ 368/t), down by JPY 11,100/t ($ 79/t) y-o-y. Metal spreads were JPY 61,500/t ($ 436/t), up by JPY 11,200/t ($ 79/t) y-o-y.

Operating income for the April-June period was JPY 5.1 billion ($0.04 billion), with metal spreads of JPY 9.97 billion ($0.07 billion) and volume increases of JPY 921 million ($6.52 million), as well as the elimination of a valuation loss of JPY 1.1 billion ($0.01 billion) in the same period of the previous year. On the other hand, costs deteriorated by JPY 6.89 billion ($0.05 billion), including a 45% increase in electricity and fuel costs, and worsened by JPY 7,740/t ($ 55/t).

Note: This article has been written in accordance with an article exchange agreement between Japan Metal Daily and SteelMint.