FerroChina states earnings could rise by as much as 30%

FerroChina, one of Asia's largest makers of heavy galvanised steel coils, forecasts that its earnings will rise by as much as 30 percent this year due to its purchase of Changshu Everbright Material Technology Co. Ltd. This purchase is earnings accretive with effect of FY2006. The company has reported a 35% increase in net profit to RMB146 million for FY2005 and analyst estimates the company could see profits rise up to 48% this year.

In addition the FerroChina, whose products are used in China's auto and construction industry, has said it will aggressively expand production capacity over the next couple of years to drive earnings growth. However, the stance by the Chinese government to curb growth could potentially limit revenues and earnings for FerroChina.