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Delong Holdings Q1 profit falls 28% to 280.8m yuan

CHINESE steel manufacturer Delong Holdings Limited posted a 27.6 per cent fall in profit for the first quarter from 387.8 million yuan (S$81.4 million) in the year-ago period to 280.8 million yuan, it said on Thursday evening.

Earnings per share dropped to 2.55 yuan from 3.52 yuan in the previous year.

For the three months ended March 31, revenue slipped 1.2 per cent from 2.99 billion yuan from the previous year to 2.95 billion yuan.

The decline in revenue was due mainly to a significant decrease in sales volume during the quarter, despite a significant increase in average selling prices of hot-rolled steel coil sold, it said.

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Total cost of sales for Delong in the first quarter increased 2.1 per cent, from 2.46 billion yuan a year ago to 2.51 billion yuan.

The increase was primarily due to higher raw material prices for production, despite lower sales volume for the three months ended March 31 when compared to a year ago, Delong said.

The increase was also due to higher repair and maintenance expenses incurred on the group's production facilities as well as higher wages in Q1, it added.

Net asset value per share edged up to 44.02 yuan as at March 31, from 41.56 yuan three months ago.

Delong shares ended S$0.03 or 0.7 per cent down at S$4.20 on Thursday before the announcement.