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The eastern China steel major’s profits totalled 5.82 billion yuan ($951 million) last year, flat with 2013 levels, it said on Wednesday January 14. Figures remain their lowest since 2009.
Operating revenue totalled 188.4 billion yuan ($31 billion) in 2014, compared with 189.69 billion ($30.96 billion) yuan a year earlier.
A drop in steel product sales prices, and scheduled maintenances on one of its blast furnaces as well as major production lines, were cited as the main drivers behind the weak performance, the steelmaker said.
Prices of cold rolled coil - Baosteel's main product - averaged 3,980 yuan ($650) per tonne in the country's eastern region during 2014, down 12% from average levels the previous year, according to Steel First price archives.
Baosteel previously estimated that its steel output would decrease by around 300,000 tonnes in the third quarter of 2014, and by 400,000-500,000 tonnes in the fourth quarter, as a result of maintenance on its No 4 blast furnace which began on September 1.
As the country’s most profitable steelmaker, Baosteel’s 2014 business performance has disappointed the market.
“I think its performance is far from satisfactory, given such a slump in iron ore costs,” a Beijing-based analyst said.
Metal Bulletin’s index for 62% Fe seaborne iron ore averaged $96.93 per tonne cfr China in 2014, down by almost 30% from a yearly average of $135.90 in 2013, according to Steel First price archives.
Baosteel’s net profits were unchanged year-on-year in 2014 as lower sales prices and scheduled maintenance offset the benefits of cheaper raw materials.