Nippon Steel returns to profit in H1 FY27

Nippon Steel Corporation returned to profit in the first half of its fiscal year ending March 2027, supported by higher overseas earnings and the contribution from U.S. Steel.

The Japanese steelmaker reported revenue of JPY 5.84 trillion (USD 37 bln) for the six months ended September 30, up 26.1pct YoY. Net profit reached JPY 279.1 bln (USD 1.8 bln), compared with a net loss of JPY 98.9 bln in the same period last year.

Consolidated crude steel output increased to 28.55 mln tons during the April-September period, compared with 22.93 mln tons a year earlier. However, steel materials shipments edged down to 15.25 mln tons from 15.47 mln tons.

The company said overseas operations contributed JPY 168.1 bln to underlying business profit, with U.S. Steel and Nippon Steel Slovakia accounting for JPY 99 bln. Nippon Steel expects U.S. Steel to remain a key earnings driver, forecasting underlying business profit of JPY 230 bln or more from the operations in the full fiscal year.

Nippon Steel raised its full-year forecast and expects revenue of JPY 11.7 trillion (USD 74.1 bln). It forecasts net profit of JPY 440 bln (USD 2.8 bln) for the fiscal year ending March 31, 2027.

The company said domestic operations continue to face challenging conditions due to weak steel demand and higher raw material and fuel costs. It expects to improve earnings through higher sales prices and cost reductions.

Overseas, Nippon Steel is continuing its expansion strategy. The company has decided to invest nearly USD 3 bln in a new hot strip mill at U.S. Steel's Mon Valley Works, bringing its cumulative strategic investment plans in the US to around USD 6.7 bln.

In Europe, Nippon Steel Slovakia will invest in a new electric arc furnace and air separation unit at its Kosice steelworks. The company is also expanding its operations in India, where construction of a new integrated steelworks at Rajayyapeta plant with initial crude steel capacity of 7 mln tons per year is planned.

Nippon Steel Corporation, headquartered in Tokyo, is Japan's largest steelmaker and the world's third-largest steel producer. The company has consolidated global crude steel production capacity of around 76 mln tons per year, including 44 mln tons in Japan and 32 mln tons overseas, with a long-term target to expand capacity to 100 mln tons per year.

1 USD / 158 JPY