(Xinhua)
Updated: 2008-04-29 15:41

BEIJING  -- China's largest steel provider, Baoshan Iron and Steel Co Ltd, reported its first quarter net profit rose 16 percent over the same period last year on better performance from its stainless steel sector.

The profit reached 4.26 billion yuan (US$609 million), with earnings per share valued at 0.24 yuan, according to the quarterly report released by the Shanghai-based company on Monday.

Baoshan's total profit soared 71 percent, or 2.41 billion yuan, to 5.82 billion yuan compared with the previous quarter. The improved performance came despite rising costs due to the severe power supply shortage and a transport strain caused by the snow disaster in south China starting in late January, as well as price increases in raw materials and fuel.

Analysts attributed the leap to its recovering stainless steel business, whose gross profit declined 17 percent in 2007 as nickel prices fluctuated violently. The sales rebound in the sector reduced the impairment of assets by 370 million yuan in the first quarter compared with the same period last year.

Baosteel's 2007 total profit rose 0.5 percent to 19.31 billion yuan. Its sales revenue stood at 191.56 billion yuan last year and was expected to reach 200 billion yuan in 2008.

The company was also included in the Fortune 500 list for the fourth straight year in 2007. It ranked the 307th among the 500 tops companies, and sixth among all steel companies.

Its shares rose 1.01 percent to 12.90 yuan on the Shanghai Stock Exchange on Monday.