Hebei Steel's First-Half Net Surges to $105.9 Million on Asset Purchases

Hebei Iron & Steel Co., the listed unit of China’s biggest steelmaker, said first-half profit surged more than 10-fold after acquisitions boosted production.

Net income climbed to 719.6 million yuan ($105.9 million), or 0.10 yuan a share, from 66.9 million yuan, or 0.01 yuan, a year ago, the Tangshan, Hebei province-based company said today in a statement to the Shenzhen stock exchange. Sales rose to 58.7 billion yuan from 40.9 billion yuan.

Hebei Steel absorbed Handan Iron & Steel Co. and Chengde Xinxin Vanadium and Titanium Co. last year as part of a reorganization led by parent Hebei Iron & Steel Group. Buying Handan and Chengde almost doubled Hebei Steel’s output to 23 million metric tons.

Hebei Steel closed unchanged at 3.95 yuan today in Shenzhen, compared with a 0.3 percent gain in the benchmark Shanghai Composite Index.

Average steel prices in China averaged 4,218 yuan a ton in the first half, up 15 percent from 3,680 yuan a year earlier, according to Beijing Antaike Information Development Co. Wuhan Iron & Steel Co., the listed unit of China’s third-biggest steelmaker, reported a 90 percent gain in first-half profit as reviving demand from auto and appliance makers boosted prices.

Hebei Steel boosted production of the alloy by 24 percent to 12.9 million tons in the first half, the statement aid.

--Helen Yuan, Li Xiaowei. Editors: Indranil Ghosh, Josh Fellman

To contact the Bloomberg News staff on this story: Helen Yuan in Shanghai at hyuan@bloomberg.net

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