Tokyo Steel Manufacturing saw a significant boost in its shares on Monday morning following the release of its robust first-quarter results and an increase in full-year profit guidance.
The company’s shares soared by 21% during morning trading, reaching the upper end of the day’s range at 1,703 yen.
For the quarter ended June 30, Tokyo Steel reported a net profit of Y8.845 billion ($62.4 million), marking a remarkable 30% increase from the previous year. This surge in profit was driven by a 13% rise in first-quarter revenue, reaching Y102.755 billion. The surge in revenue was attributed to higher selling prices and increased shipping volume, driven by strong demand for private capital spending.
In addition, Tokyo Steel was able to secure iron scrap at lower-than-expected prices and reduce fixed costs due to improved capacity utilization. This further contributed to the company’s impressive financial performance.
As a result of its strong performance, Tokyo Steel has revised its net profit forecast for the fiscal year ending in March 2024. The company now expects a 22% drop in net profit, reaching Y24.00 billion, up from its previous projection of Y21.00 billion.
These positive developments highlight Tokyo Steel Manufacturing’s resilience and ability to adapt to the ever-changing market conditions in the steel industry.