Tokyo: Nippon Steel Corp reported a 5.6% drop in nine-month profit as a slump in car sales hit its mainstay autosheet steel business, and it cut its profit outlook for this year by 35.7%.
Nippon Steel, the world’s No.2 steelmaker after ArcelorMittal, said April-December profit was ¥410.43 billion ($4.56 billion) down from ¥434.67 billion a year earlier.
It forecast a ¥360 billion profit for the year to the end of March, down from an earlier forecast for ¥560 billion.
Its latest guidance is lower than a consensus estimate for ¥512.3 billion in a poll of 15 analysts by Reuters Estimates.
While weaker demand for everything from cars to household appliances dents earnings at all global steelmakers, Japan’s steel mills are finding it tougher still as carmakers such as Toyota Motor Corp are their top customers.
Shares in Nippon Steel dropped 25% in October-December, roughly in line with Tokyo’s iron and steel subindex but lagging the benchmark Nikkei’s 21% fall.
South Korean rival POSCO, the world’s No.4 steelmaker, fell 14% in the same period. ($1=90.08 yen)