- Higher raw material costs supported product prices
- Q3 performance expected broadly similar to Q2
Taiwanese stainless steel producer Walsin Lihwa recorded its highest-ever first-half net profit, supported by strong second-quarter performance across its stainless steel, resources and wire and cable businesses. The company’s stainless steel sales increased 12% y-o-y in Q2, while higher raw material costs supported product prices.
Record profit in first half
Walsin Lihwa reported a net profit of TWD 9.043 billion in Q2, with earnings per share (EPS) at TWD 2.04. First-half net profit reached a record TWD 12.628 billion, with EPS at TWD 2.85.
First-half revenue stood at TWD 90.718 billion, down 0.6% y-o-y, while Q2 revenue increased 21% q-o-q and 7% y-o-y to TWD 49.6 billion.
Stainless steel sales increase 12%
The company’s stainless steel business recorded a 12% y-o-y increase in sales during Q2. Performance was supported by improved product prices amid higher raw material costs.
Meanwhile, the resources business recorded a 17% increase in sales, benefiting from higher nickel pig iron (NPI) prices and increased sales volumes. The wire and cable business also reported a 9% increase in sales.
Investment-related gains further supported overall profitability, with Walsin Lihwa reportedly recognising around TWD 8.5 billion in gains from investments and disposal of investment assets during Q2.
Q3 outlook remains stable
Walsin Lihwa expects the performance of its stainless steel, resources and wire and cable businesses in Q3 to remain broadly similar to Q2.
In the stainless steel segment, high nickel prices are expected to continue supporting product prices in Taiwan. In China, measures aimed at curbing oversupply and high raw material costs are expected to provide price support.
In Europe, the company expects the impact of the Carbon Border Adjustment Mechanism (CBAM) and tighter import regulations to remain key market factors.
Indonesia policies remain key for NPI
The resources business is expected to see relatively stable NPI production, prices and performance in Q3. However, Indonesia’s restrictions on nickel ore mining permits remain a key factor for the business outlook.
Meanwhile, Walsin Lihwa expects continued growth opportunities in its wire and cable business from global AI development, data-centre expansion, power-grid upgrades and energy infrastructure investments.
Note: This article is published as part of a content exchange agreement between SteelDaily and BigMint.
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