BEIJING, Sept. 27, 2012 /PRNewswire-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, today announced select preliminary financial results for the first half of 2012 and provided an update on its operations and strategic initiatives. For the first half of 2012, General Steel expects to report revenues of approximately US$1.4 billion and production volume of approximately 2.4 million metric tons.
"While the nationwide steel market has slowed, demand in our primary target market of Western China has remained stable, supported by large-scale, government-sponsored housing and infrastructure investment projects," said Mr. Henry Yu, General Steel Chairman and Chief Executive Officer. "Our sales and volume momentum remains strong and continues to grow as Shaanxi Province and the nearby areas initiate new infrastructure projects that have been recently approved by the National Development and Reform Commission. Situated in Shaanxi, we believe our Longmen JV presents a highly capable, geographically desirable partner for these upcoming projects, and we believe we are well positioned to capture new growth opportunities as we extend our presence in this rapidly developing region. Our expanded Unified Management Agreement with Shaanxi Steel and Shaanxi Coal, is creating additional advantages by improving our raw material procurement and direct sales capabilities and further strengthening our market position."
"Expanding our direct sales channel and securing new contracts have been among our primary areas of focus. In the first half of the year, we have increased cooperation with large state-owned-enterprises through direct sales contracts. We are simultaneously maintaining tight expense controls, scaling production at Longmen JV, improving our product-mix and achieving additional operating efficiencies to mitigate market challenges and pricing pressure. While the cost of both iron ore and other raw materials for steel products remains volatile, we expect to offset pricing fluctuations based on our strategic cost reduction and efficiency improvement initiatives. Under our benchmarking program, we are improving our raw materials procurement capabilities, reducing transportation costs for securing coke, and upgrading equipment with state-of-the-art technology," Mr. Yu concluded.