Weak economy cuts China's Ansteel 2008 net profit 55%

Special Report:Global Financial Crisis

BEIJING, Jan. 21 (Chinese media) -- China's Angang Steel Co. Ltd.

(Ansteel) said Wednesday net profit fell 55 percent last year to an estimated

3.42 billion yuan (about 500 million U.S. dollars) Assteel prices plunged.

Ansteel, one of the country's top three steel

producers, issued the estimate in an unaudited statement to the Shenzhen Stock

Exchange, where it is listed.

The final figure indicates a loss of 4.83 billion

yuan in the fourth quarter, as previous company data show net profits in the

first three quarters totaled 8.25 billion yuan.

The decline reflected steep falls in steel prices and

slow inventory movement starting in the second half, said the northeast-based

company.

Steel prices in China plummeted in the second half as

the deepening world economic slowdown weakened industrial growth and steel

demand in the country.

The price of 6.5 mm carbon steel wire rods, a major

steel product, was down more than 40 percent since June, Jia Yinsong, a Ministry

of Industry and Information Technology official, told a forum earlier in

January. Market data show the product was sold at about 3,400 yuan per ton.

The company also attributed the weak performance to

the costs of buying raw materials and fuel at high prices earlier in 2008.

World crude oil prices are down more than 70 percent

since peaking at 147 U.S. dollars per barrel in July. Earnings per share were

estimated at 0.47 yuan in 2008, down 58 percent from in 2007,Ansteel said.

The company didn't give a date for the release of its

audited results, which under Chinese rules must be done within six months.