JFE Steel will be idling two blast furnaces temporarily and reducing capacity by 25pc as the COVID-19 crisis maintains downward pressure on steel demand.

 

JFE Holdings, which owns the steel producer, recorded a JPY197.7bn ($1.84bn) loss in financial year 2019 ended March 31, 2020, and has described the situation as its worst crisis in 18 years. Consequently, the parent company will slash costs by JPY100bn, sell stakes in some of its subsidiaries, reconsider planned investments, and reduce inventories.

It also cut its guidance for the year, stating the company isn’t capable of forecasting the full impact the COVID-19 pandemic will have on its business. 

 

The firm also attributed its loss to weak export prices and a large impairment loss on its plants in Japan. 

 

JFE Holdings’ revenue in FY 2019, totaled JPY3.7tn, declining by 3.7pc from JPY3.9tn in FY 2018. Its business profit plummeted by 83.7pc to JPY38mn during the year from JPY2.32bn in FY 2018. 

 

The company’s steel revenue reached JPY2.7tn in FY2019, declining by 5.3pc from JPY2.8tn in FY 2018.

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