Japan’s largest steelmaker, Nippon Steel, has lifted its full-year profit forecast after strong earnings from its US Steel business reflected improving market conditions and operational gains in the United States.
The company on Tuesday increased its full-year net profit forecast by 32% to 290 billion yen ($1.84 billion), citing stronger earnings from US Steel as a firmer US steel market continued to support growth.
For the April–June quarter, Nippon Steel posted a net profit of 75.30 billion yen, marking a sharp turnaround from the 195.83 billion yen net loss recorded in the same period last year, when it booked a substantial one-off loss related to the sale of its stake in the AM/NS Calvert joint venture.
Speaking at a news conference, Chief Financial Officer Takahiko Iwai said US Steel was the biggest contributor to the group’s earnings, noting that measures introduced after the acquisition to improve product quality and enhance operational efficiency also strengthened the subsidiary’s profitability.
Reflecting the stronger outlook, Nippon Steel raised its underlying business profit forecast for US Steel in the financial year ending March 2027 to at least 180 billion yen, up from its previous projection of 100 billion yen or more announced in May.
The company also upgraded its outlook for the US hot-rolled coil market, raising its expected price range by $100 to between $1,000 and $1,100 per short ton following the recent rise in steel prices.
Iwai said higher inventory valuation gains, driven by the weaker yen against the US dollar and rising raw material costs, also contributed to the upward revision of the company’s full-year earnings forecast.
Despite the improved outlook, Nippon Steel warned that the conflict in the Middle East reduced first-quarter earnings by about 25 billion yen and is expected to trim full-year profits by around 60 billion yen.
The company also acknowledged that earnings from its domestic operations remain under pressure. It said it plans to pass higher raw material and fuel costs on to customers while expressing confidence that Japan’s recently introduced anti-dumping measures will help curb imports of low-priced steel and support stronger domestic steel prices.
Goodness Anunobi
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