In the first three quarters of 2011, operating revenue of Xining Special Steel Co., Ltd. (600117.SH) reached RMB6.22 billion, up 20% YoY; while its total profit achieved RMB573.08 million, up 132% YoY.

Growth Rate of Operating Income and Total Profit of Xining Special Steel, 2008- Jan. - Sept. 2011

Source: Xining Special Steel; ResearchInChina

Main products of Xining Special Steel include special steel products such as alloy structural steel, carbon structural steel, bearing steel, stainless steel, and crude fuel products such as iron concentrate powder and coke etc. During Jan. to Sept. 2011, benefitting from the price rise of special steel and iron concentrate powder, profitability of the company increased consequently.

Integrated gross margin of Xining Special Steel grew by 3.3 percentage points year-on-year to be 21.5% in the first three quarters. Its gross margin kept increasing quarter-on-quarter, and achieved 20.8%, 20.9% and 23% in Q1, Q2, and Q3, respectively. Currently, iron concentrate powder enjoyed the highest profitability among its special steel products, which becomes the main driving force of integrated gross margin growth.