BEIJING, Aug. 15, 2011 /PRNewswire-Asia-FirstCall/ -- General Steel Holdings, Inc. ("General Steel" or "the Company") (NYSE: GSI), one of China's leading non-state-owned producers of steel products and aggregators of domestic steel companies, today announced its financial results for the second quarter ended June 30, 2011.
Second Quarter 2011 Financial Highlights
- Revenue increased approximately 100% year-over-year to approximately $1billion in the second quarter of 2011, from $502 million in the second quarter of 2010.
- Second quarter 2011 sales volume totaled approximately 1.8 million metric tons, compared with 1.0 million metric tons in the second quarter of 2010.
- Gross profit increased by approximately 280% year-over-year to approximately $28 million, or 2.7% of revenue, up from $7 million, or 1.5% of revenue in the second quarter of 2010.
- Operating income for the quarter was approximately $6 million, compared with an operating loss of $(6.3) million in the second quarter of 2010.
- Net loss attributable to the Company was approximately $(1.5) million, or $(0.03) per diluted share based on 55.2 million weighted average shares outstanding, compared with a net loss of $(2.1) million, or $(0.04) per diluted share based on 52.1 million weighted average shares outstanding in the second quarter of 2010.
- As of June 30, 2011, the Company had cash and restricted cash of approximately $262 million and total stockholders' equity of approximately $102 million.
Financial Highlights for the Six Months Ended June 30, 2011
- Revenue increased approximately 84% year-over-year to approximately $2 billion, from $1 billion in the same period in 2010.
- Sales volume for the first six months of 2011 totaled approximately 3 million metric tons, compared with 2 metric tons for the same period in 2010.
- Gross profit was approximately $56.3 million, or approximately 3.1% of revenue, compared with $13 million, or 1.4% of revenue for the same period in 2010.
- Operating income totaled approximately $20 million, compared with an operating loss of $(13) million for the same period in 2010.
- Net income attributable to the Company was approximately $1.1 million, or approximately $0.02 per diluted share, based on 55.0 million weighted average shares outstanding, compared with a net loss of $(7.6) million, or $(0.15) per diluted share, based on 51.9 million weighted average shares outstanding in the first six months in 2010.
Second Quarter 2011 and Recent Business Highlights
- The Company signed a 20-year unified management agreement with Shaanxi Coal and Chemical Industry Group Co., Ltd. ("Shaanxi Coal") and Shaanxi Iron and Steel Group Co., Ltd ("Shaanxi Steel") for the Company's Longmen Joint Venture Operations, pursuant to which Shaanxi Steel constructed two 1,280 cubic meter blast furnaces, two 120 metric ton converters and one 400 square meter sintering machine. The new equipment installed in conjunction with this agreement added three million metric tons of crude steel production capacity at the Longmen Joint Venture, increasing annual capacity to seven million metric tons.
- In May 2011, the Company completed its initial buyback of one million shares under a share repurchase program and received Board approval for a subsequent one million share under the repurchase program, which commenced on June 1, 2011. As of August 14, 2011, the Company had purchased 1,090,978 shares of common stock in open market transactions at an average price of $2.56 per share under the Share Repurchase Program since its inception in December 2010.
- In July 2011, the Company completed the installation and initiated test production on a 1,000,000 metric ton capacity high-speed wire production line, which was transferred from GSI's Maoming facility to Longmen Joint Venture in December 2010. A 1.2 million metric ton capacity rebar production line, which was also transferred from the Maoming facility to Longmen Joint Venture, has been engaged in trial production beginning in November 2010. The strategic reallocation of these resources is aimed at reducing manufacturing costs through improved operational and energy efficiency and more efficient utilization of crude steel output.
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