6/11/13
General Steel Reports First and Second Quarter 2012 Financial Results
Company Reports 18.6% Year-over-Year Increase in Gross Profits in the First Half of 2012
Reiterates Intent to File 2012 Annual Report on Form 10-K on or before June 21, 2013
PR NewswirePress Release: General Steel Holdings, Inc. – Tue, Jun 11, 2013 8:00 AM EDT...
BEIJING, June 11, 2013 /PRNewswire/ -- General Steel Holdings, Inc. ("General Steel" or the "Company") (GSI), a leading non-state-owned steel producer in China, today announced financial results for the first quarter ended March 31, 2012 and the second quarter ended June 30, 2012. In conjunction with this announcement, the Company has filed the corresponding Quarterly Reports on Form 10-Q with the U.S. Securities & Exchange Commission (the "SEC").
"The completion of these financial reports is another big step forward in our march towards bringing the Company current in its reporting obligations. I would like to thank our finance team and auditor for their tireless efforts to complete these filings and our shareholders for their continued support of the Company," said Henry Yu, Chairman and Chief Executive Officer of General Steel.
"Statistics from China Iron and Steel Association and reports from other publicly-listed Chinese steel companies clearly showed that 2012 was a very tough year for the entire steel industry. However, benefiting from our favorable geographic advantage in Western China and close cooperation with the government and state-owned enterprises, I'm encouraged that General Steel was able to significantly grow gross profits and improve gross margin in the first six months of 2012. We remain focused on executing our business strategy."
General Steel is currently preparing its Quarterly Report on Form 10-Q for the period ended September 30, 2012 and Annual Report on Form 10-K ("Annual Report") for the year ended December 31, 2012 and intends to file on or before June 21, 2013. Filing the Annual Report will regain compliance with the New York Stock Exchange's continued listing standards.
First Six Months 2012 Financial Review
•Revenue decreased 19.4% year-over-year to $1.4 billion in the first six months of 2012, from $1.8 billion in the first six months of 2011.
•Sales volume totaled approximately 2.5 million metric tons, compared with 3.0 million metric tons in the first six months of 2011.
•Gross profit increased 18.6% year-over-year to $33.7 million, or 2.4% of revenue, up from $28.4 million, or 1.6% of revenue in the first six months of 2011.
•Operating loss for the quarter improved to $(5.1) million, compared with an operating loss of $(13.1) million in the first six months of 2011.
•Net loss attributable to the Company was $(61.2) million, or $(1.11) per diluted share based on 55.2 million weighted average shares outstanding, compared with a net loss of $(31.8) million, or $(0.59) per diluted share based on 54.2 million weighted average shares outstanding in the first six months of 2011.
The increase in net loss for the first six months of 2012 was primarily attributable to a provision of inventory allowance of $16.9 million due to drop in market prices, and an increase of $65.1 million in finance expense. The increased in finance expense include an increase of $14.9 million in interest expense on capital lease, and $50.2 million in interest expense on bank borrowings, related parties borrowings, and discounted notes receivables.
First Quarter 2012 Financial Review
•Revenue decreased 8.8% year-over-year to $648.0 million in the first quarter of 2012, from $710.5 million in the first quarter of 2011.
•Sales volume totaled approximately 1.2 million metric tons, relatively unchanged from the first quarter of 2011.
•Gross profit increased 11.5% year-over-year to $5.6 million, or 0.9% of revenue, up from $5.0 million, or 0.7% of revenue in the first quarter of 2011.
•Operating loss for the quarter was $(13.0) million, compared with an operating loss of $(9.5) million in the first quarter of 2011.
•Net loss attributable to the Company was $(34.8) million, or $(0.63) per diluted share based on 55.5 million weighted average shares outstanding, compared with a net loss of $(8.9) million, or $(0.16) per diluted share based on 54.8 million weighted average shares outstanding in the first quarter of 2011.
Second Quarter 2012 Financial Review
•Revenue decreased 26.5% year-over-year to $780.7 million in the second quarter of 2012, from $1.1 billion in the second quarter of 2011.
•Sales volume totaled approximately 1.3 million metric tons, compared with 1.8 million metric tons in the second quarter of 2011.
•Gross profit increased 20.2% year-over-year to $28.0 million, or 3.6% of revenue, up from $23.3 million, or 2.2% of revenue in the second quarter of 2011.
•Operating income for the quarter totaled $7.9 million, compared with an operating loss of $(3.7) million in the second quarter of 2011.
•Net loss attributable to the Company was $(26.4) million, or $(0.48) per diluted share based on 54.9 million weighted average shares outstanding, compared with a net loss of $(22.9) million, or $(0.42) per diluted share based on 54.3 million weighted average shares outstanding in the second quarter of 2011.
Balance Sheet
As of June 30, 2012, the Company had cash and restricted cash of approximately $465.8 million, compared to $518.2 million as of December 31, 2011. The Company had an inventory balance of approximately $323.3 million as of June 30, 2012, compared to $297.7 million as of December 31, 2011. As of June 30, 2012, the Company had total liabilities of approximately $3.1 billion.
About General Steel Holdings, Inc.
General Steel Holdings, Inc., headquartered in Beijing, China, produces a variety of steel products including rebar, high-speed wire and spiral-weld pipe. The Company has operations in China's Shaanxi and Guangdong provinces, Inner Mongolia Autonomous Region and Tianjin municipality with seven million metric tons of crude steel production capacity under management. For more information, please visit www.gshi-steel.com.
To be added to the General Steel email list to receive Company news, or to request a hard copy of the Company's Annual Report on Form 10-K, please send your request to generalsteel@asiabridgegroup.com.
