As the largest steel company in China and the world, China Baowu Iron and Steel Group can be described as a giant in the industry. Baowu Iron & Steel was formed by the joint reorganization of Shanghai Baosteel Group and Wuhan Wuhan Iron and Steel Group in 2016. After that, it successively merged some local iron and steel mills, forming an enterprise scale with an annual output of 100 million tons, which is unparalleled in the world.
Recently, Baowu Iron and Steel Group released its 2023 revenue financial report, which shows that the annual crude steel output is 130 million tons, the operating income is 1,103 billion yuan, the total profit is 31.6 billion yuan, and the total debt of the enterprise is about 680 billion yuan.
However, it needs to be reminded here that the steel industry generally has the characteristics of high debt management, the average debt ratio of the mainland steel industry is about 60%, like a few years ago, Baowu Group merged with the total assets of 75.6 billion yuan, the total debt of 70.8 billion yuan, the asset-liability ratio is as high as 93%. After the merger, the liabilities of Sinosteel Group will naturally be counted into Baowu Group.
From the perspective of business operation, high debt can meet the capital needs of iron and steel enterprises in a timely and rapid manner, expand the scale of production and adjust the product structure, but at the same time, the financial risks brought by high debt are also obvious, especially in the current steel industry market prosperity index continues to hover at a low level, the market needs are saturated and peaked, and will face problems such as slow repayment, increased pressure on repayment due, Even in the later stage, the embarrassing situation of not being able to obtain new loans has led to a decline in the net cash inflow of the enterprise, which in turn affects the security of the company's capital chain.
However, in the case of Baowu Iron and Steel Group, its total assets are close to 1.3 trillion yuan, and its debt ratio is still within a reasonable control range, so there is no need to worry too much.
The scale of revenue is unbeatable
In terms of annual revenue, Baowu Group is really unbeatable, so that Chinese and foreign opponents cannot see the taillights. In the list of the world's top 500 companies released last year, China Baowu Group ranked 44th, ranking among the top 50 for the first time, and has held the top spot among global steel companies for three consecutive years.
In 2023, China's total steel sales revenue will be 8.3 trillion yuan, and Baowu alone will account for more than one-eighth of it. ArcelorMittal, the former world's largest steel company, will have a revenue of only $70 billion in 2023, only half of Baowu Steel, Japan Steel's revenue of about $56 billion, and Germany's ThyssenKrupp revenue of $41 billion.
Profit performance is impressive
Compared with other domestic iron and steel groups, such as Anshan Iron and Steel and Hegang, Baowu Group's total profit is 31.6 billion yuan, ranking first. For example, the steel giant Anshan Iron and Steel will achieve a net profit of -3.257 billion yuan in 2023, Shougang's profit is only about 1.5 billion yuan, and Shagang's net profit attributable to shareholders of listed companies is about 188 million yuan to 222 million yuan. Other iron and steel companies are basically in a state of loss or slight loss.
Compared with the three major international steel giants, Baowu Group's profit performance is also outstanding. ArcelorMittal, the world's second-largest steel giant, made a profit of $4.8 billion for the year, only $500 million more than Baowu Steel. You must know that in 2022, ArcelorMittal's profit will be as high as 10.2 billion US dollars, nearly 6 billion US dollars more than Baowu Steel, and now the profit gap between the two has been greatly narrowed.
South Korea's POSCO's full-year profit plummeted 48 percent from the previous year to US$3 billion, while U.S. Steel had a net profit of less than US$1 billion and was likely to be wholly acquired by Nippon Steel.
A giant steel enterprise with invincible production capacity
As the world's largest and most influential steel company, Baowu Group has been on the road of expansion pilot since 2019. It has successively implemented joint reorganization with Masteel Group, TISCO Group, Xingang Group and Sinosteel Group, and has become the actual controller of Chongqing Iron and Steel Group, and has entrusted Heavy Steel Group and Kunshan Iron and Steel Company.
At present, Baowu Group has a total of 12 listed companies, ranking first in crude steel production, first in automotive steel output and first in silicon steel production among the world's listed steel enterprises, and is one of the steel enterprises with the most complete carbon steel varieties in the world.
In recent years, Baowu Group has accelerated the pace of going to sea, signed contracts with Saudi Aramco Oil Company and Saudi Public Investment Fund to jointly build the world's first green and low-carbon full-process thick plate factory in Saudi Arabia, and will build a full-process steel manufacturing base with an annual design capacity of 2.5 million tons of direct reduced iron and 1.5 million tons of thick plate. The steel produced is mainly used in the Middle East and North Africa region, including oil and gas, shipbuilding, offshore engineering, and tank and pressure vessel manufacturing. This will also be Baosteel's first full-process production base overseas.