Baoshan Iron & Steel (600019) H1 2024 earnings summary

Executive summary

• Revenue for H1 2024 was RMB 163.25 billion, down 3.89% year-over-year due to weaker steel demand and lower prices.

• Net profit attributable to shareholders was RMB 4.55 billion, nearly flat year-over-year; adjusted net profit (excluding non-recurring items) rose 12.84%.

• Maintained industry-leading profitability and domestic leadership despite market headwinds and narrowing purchase-sale price spreads.

• Announced interim cash dividend of RMB 0.11/share, totaling RMB 2.37 billion, representing 52.13% of H1 net profit.

• Continued leadership in high-end steel, green transformation, and digital/AI innovation, with record H1 export orders of 3.04 million tons.

Financial highlights

• Operating income: RMB 163.25 billion, down 3.89% year-over-year.

• Net profit attributable to shareholders: RMB 4.55 billion, down 0.17% year-over-year.

• Adjusted net profit (excluding non-recurring items): RMB 4.24 billion, up 12.84% year-over-year.

• Basic EPS: RMB 0.21, up 5% year-over-year; adjusted EPS: RMB 0.19, up 11.76%.

• Operating cash flow: RMB 5.74 billion, down 8.02% year-over-year.

• Gross margin: 5.7%, up 0.5 percentage points year-over-year.

• Total assets at period end were RMB 367.97 billion, down 2.15% from year-end.

Outlook and guidance

• Steel industry expected to remain oversupplied in H2 2024; demand from shipbuilding and new energy sectors to be key drivers.

• Company targets to maintain domestic industry leadership, accelerate digital and green transformation, and further cost reduction.

• H2 focus on product differentiation, digital/AI upgrades, and leveraging multi-base synergies.

• Ongoing implementation of digital transformation and green, low-carbon initiatives.