BEIJING, Sept. 27, 2012 /PRNewswire-FirstCall/ -- General
Steel Holdings, Inc. ("General Steel" or the "Company") (NYSE:
GSI), one of China's leading
non-state-owned producers of steel products and aggregators of
domestic steel, today announced select preliminary financial
results for the first half of 2012 and provided an update on its
operations and strategic initiatives. For the first half of 2012,
General Steel expects to report revenues of approximately
US$1.4 billion and production volume
of approximately 2.4 million metric tons.
"While the nationwide steel market has slowed, demand in our
primary target market of Western
China has remained stable, supported by large-scale,
government-sponsored housing and infrastructure investment
projects," said Mr. Henry Yu,
General Steel Chairman and Chief Executive Officer. "Our sales and
volume momentum remains strong and continues to grow as
Shaanxi Province and the nearby
areas initiate new infrastructure projects that have been recently
approved by the National Development and Reform Commission.
Situated in Shaanxi, we believe
our Longmen JV presents a highly capable, geographically desirable
partner for these upcoming projects, and we believe we are well
positioned to capture new growth opportunities as we extend our
presence in this rapidly developing region. Our expanded
Unified Management Agreement with Shaanxi Steel and Shaanxi Coal,
is creating additional advantages by improving our raw
material procurement and direct sales capabilities and further
strengthening our market position."
"Expanding our direct sales channel and securing new contracts
have been among our primary areas of focus. In the first half of
the year, we have increased cooperation with large
state-owned-enterprises through direct sales contracts. We are
simultaneously maintaining tight expense controls, scaling
production at Longmen JV, improving our product-mix and achieving
additional operating efficiencies to mitigate market challenges and
pricing pressure. While the cost of both iron ore and other raw
materials for steel products remains volatile, we expect to offset
pricing fluctuations based on our strategic cost reduction and
efficiency improvement initiatives. Under our benchmarking program,
we are improving our raw materials procurement capabilities,
reducing transportation costs for securing coke, and upgrading
equipment with state-of-the-art technology," Mr. Yu concluded.
"While we focus on implementing our strategic operating
efficiency initiatives, we continue upholding the highest standards
of internal controls and accounting policies," said John Chen, Chief Financial Officer of General
Steel.
"In August, we successfully completed restatement of 2009, 2010
and first quarter 2011 financial results. We view the completion of
these restatements as an important step forward for our Company. We
are now focused on completing the audit process and SEC filings for
our outstanding financial statements. We look forward to completing
this process and returning to a regular financial reporting
schedule as soon as possible," stated Mr. Chen.
Recent Operational Highlights
- Completed the first stage of a series of benchmarking programs,
which have resulted in efficiency improvements and cost reduction
at Longmen JV.
- Initiated construction on a state-of-the-art, 900,000 metric
ton seismic-grade rebar production line at Longmen JV. The
production line incorporates cutting-edge technology that is
expected to reduce rebar production costs substantially. The added
capacity will also improve margins and enable the Company to better
address demand for seismic-grade rebar in Western China.
- Currently Longmen JV is sourcing coke from a 5 million metric
ton coke plant adjacent to Longmen JV, which was built by Shaanxi
Coal and Chemical Industry Group Co., Ltd., one of the parties in
the unified management agreement. General Steel expects the
construction of a conveyor belt that will feed the coke directly to
its Longmen JV to be completed in October and further reduce
transportation costs.
Update on Filings
On August 30, 2012, General Steel
completed filing its amended annual report on Form 10-K/A for the
year ended December 31, 2010 and
amended quarterly reports on Form 10-Q/A for the quarters ended
June 30, 2010, September 30, 2010 and March 31, 2011 with the U.S. Securities and
Exchange Commission ("SEC").
With these restatements complete, the Company is working
diligently with its independent registered public accountant,
PricewaterhouseCoopers Zhong Tian CPAs Limited Company ("PwC") on
the audit process for its outstanding financial statements for
2011. Currently, the Company is finalizing its quarterly
report on Form 10-Q for the period ended June 30, 2011, while simultaneously working on
the quarterly report on Form 10-Q for the period ended September 30, 2011 and its Annual Report on Form
10-K for the year ended December 31,
2011. These reports are expected to be released in a
sequential order.
Following the completion of these filings, General Steel will
file its quarterly reports with the SEC on Form 10-Q for the
periods ended March 31 and
June 30, 2012 as soon as
possible.
About General Steel Holdings, Inc.
General Steel Holdings, Inc., (NYSE: GSI), headquartered in
Beijing, China, operates a diverse
portfolio of Chinese steel companies. With 7 million metric tons of
crude steel production capacity under management, its companies
serve various industries and produce a variety of steel products
including rebar, high-speed wire and spiral-weld pipe. General
Steel Holdings, Inc. has steel operations in Shaanxi and Guangdong provinces, Inner Mongolia Autonomous
Region and Tianjin municipality.
For more information, please visit www.gshi-steel.com.
To be added to the General Steel email list to receive Company
news, please send your request to generalsteel@tpg-ir.com.
Forward-Looking Statements
This press release may contain certain forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. These statements are based on management's
current expectations or beliefs about future events and financial,
political and social trends and assumptions it has made based on
information currently available to it. The Company cannot assure
that any expectations, forecasts or assumptions made by management
in preparing these forward-looking statements will prove accurate,
or that any projections will be realized. Actual results could
differ materially from those projected in the forward-looking
statements as a result of inaccurate assumptions or a number of
risks and uncertainties. These risks and uncertainties are set
forth in the Company's filings under the Securities Act of 1933 and
the Securities Exchange Act of 1934 under "Risk Factors" and
elsewhere, and include: (a) those risks and uncertainties related
to general economic conditions in China, including regulatory factors that may
affect such economic conditions; (b) whether the Company is able to
manage its planned growth efficiently and operate profitable
operations, including whether its management will be able to
identify, hire, train, retain, motivate and manage required
personnel or that management will be able to successfully manage
and exploit existing and potential market opportunities; (c)
whether the Company is able to generate sufficient revenues or
obtain financing to sustain and grow its operations; (d) whether
the Company is able to successfully fulfill our primary
requirements for cash; and (e) other risks, including those
disclosed in the Company's Form 10-K, filed with the SEC.
Forward-looking statements contained herein speak only as of
the date of this release. The Company does not undertake any
obligation to update or revise publicly any forward-looking
statements, whether to reflect new information, future events or
otherwise.
Contact
In China:
General Steel Holdings, Inc.
Jenny Wang
Tel: +86-10-5775-7691
Email: jenny.wang@gshi-steel.com
In the US:
The Piacente Group, Inc.
Investor Relations
Brandi Floberg or Lee Roth
Tel: +1-212-481-2050
Email: generalsteel@tpg-ir.com
SOURCE General Steel Holdings, Inc.