FY2011 Operating Profit declined by 20.0% compared to the previous year







Graphite India Limited, the largest Indian graphite electrode producer has announced its Audited Standalone Fourth Quarter and Full Year Results, as well as Consolidated Full Year Results for FY 2011, in accordance with Indian GAAP.

Commenting on the results and performance, K. K. Bangur, Chairman of Graphite India said:“Graphite India demonstrated a strong top line performance during FY2011. We saw significant growth in volumes across geographic regions as a result of steady growth in the steel industry. However, the electrode pricing environment was relatively moderate during the year. Despite this, our focus on operational efficiency and productivity resulted in Graphite India generating high operating profit margins of approximately 24% in FY2011. The continuing economic recovery globally is expected to drive further growth in the steel industry, which will directly benefit volumes and pricing in the graphite electrode industry.”

Economic Environment

The global steel industry continued to show strong growth in Q4 FY2011 with crude steel production of 374.5 million MT, an increase of 9.7% compared to Q4 FY2010. Global crude steel production in FY2011 was 1,446.6 million MT, a growth of 12.4% compared to FY2010. Although steel production was strong early in FY2011, growth moderated in the middle of the year and picked up again in Q4 FY2011. Steel production growth in Q4 FY2011 on a sequential quarter basis was 7.6%.

Growth in the steel industry remains significantly diversified across regions. During Q4 FY2011, Asia produced 240.5 million MT of crude steel, an increase of 10.5% over the Q4 FY2010 (with growth in India and China of 6.5% and 10.9%, respectively). North America’s crude steel production during this period was 28.9 million MT, 6.0% higher than the prior year. Steel production growth in the EU and South America was 6.9% and 12.2% respectively, for Q4 FY2011 as compared to the prior year. Global capacity utilization in the steel industry increased significantly to an average of 82% in Q4 FY2011 as compared to an average of 75% in Q3 FY2011.