Baosteel Q2 net profit slides 89 pct

Published: 28 Aug 2009 03:17:29 PST

SHANGHAI, Aug 28 - China's top steelmaker Baosteel posted an 89 percent drop in second-quarter net profit, hit by slow global demand and weak steel prices.

The world's third-largest steelmaker's April-June net profit fell to 580 million yuan ($84.91 million) from 5.39 billion yuan a year earlier, based on calculations from the company's first-half and first-quarter figures.

Baoshan Iron and Steel Co, which competes with South Korea's POSCO and Japan's Nippon Steel, has raised prices for its major products since June as China's recovering economy boosts demand for steel from the construction and auto sectors.

Earlier on Friday, Baosteel agreed to pay $240 million for a 15 percent stake in Australian iron ore explorer Aquila Resources, underscoring China's huge appetite for Australian assets. ($1=6.831 Yuan)