Borusan Birleşik Boru Fabrikaları Ticaret A.Ş., a leading Turkish steel pipe producer, has released its financial results for the first nine months of 2024. The company reported a net profit of TRY 311.38 million ($10.51 million), a significant drop from the TRY 3.09 billion profit recorded in the same period last year. Despite this decline in profit, Borusan's sales revenues increased by 67% year-on-year, reaching TRY 42.98 billion ($1.34 billion).
The company attributes its underwhelming financial performance to several factors, including weaker demand, challenges in pricing strategies, and cost pressures experienced during the third quarter. These challenges have impacted Borusan's ability to meet its financial expectations, despite the overall growth in sales revenue.
In terms of sales volume, Borusan achieved a total of 907,000 metric tons in the January-September period, marking a 32.2% increase compared to the same timeframe in 2023. Export sales played a crucial role, accounting for 81% of the company's total sales revenues. Within its product mix, high value-added pipes, such as pressure, special, and spiral pipes, constituted 83% of total sales revenues, while high value-added drilling pipe sales contributed 22%. This reflects a strategic focus on balancing market supply and demand.
Borusan noted in its financial report that profit margins are beginning to normalize as market conditions stabilize. However, the company continues to face challenges due to underutilization in key sectors like automotive and construction, which are suffering from weak demand and rising production costs. These factors are exerting downward pressure on steelmakers' profitability, including Borusan.
In response to these market dynamics, Borusan has adjusted its forecast for total sales volume for the full year of 2024. The company now expects to achieve sales volumes between 1 million and 1.12 million metric tons, down from its earlier projection of 1.05 to 1.20 million metric tons. Additionally, Borusan anticipates sales revenue of $1.6 to $1.8 billion for 2024, revising its previous estimates of $1.7 to $2.0 billion.
Borusan's investment activities in the first nine months of 2024 amounted to TRY 1.57 billion ($49.33 million). These investments reflect the company's commitment to enhancing its production capabilities and maintaining competitiveness in a challenging market environment.
