NEW YORK China Armco
Metals Inc. posted net income of $134,655 in the third quarter,
in contrast to a $1.1-million net loss in the same period last
year, despite a 4.6-percent decline in revenue to $15.36
million from $16.1 million.
The San Mateo, Calif.-based
scrap metals recycler and distributor of imported metal ore
said its gross profit more than doubled to nearly $1.92 million
in the three months ended Sept. 30 from $810,196 a year earlier
as scrap metal sales rose about 60 percent to $13.4 million
from around $8.3 million.
Improved profit margins were
brought on by "a significant increase of gross margin in our
scrap recycling business from 8 percent to 14 percent" as a
result of a market rebound, the company said. The
companys overall gross profit margin rose to 12.5 percent
from 5 percent.
China Armco sold 38,752 tonnes
of scrap during the third quarter, and increased scrap
production to 44,793 tonnes from 13,500 tonnes a year
"We significantly expanded our
metal recycling business activities (during the quarter) and
our production and sales increased by 232 percent and 134
percent in quantity, respectively, compared to the same period
of 2011," chairman and chief executive officer Kexuan Yao said
in a statement.
However, metal ore trading
plunged 74 percent to $2 million from $7.7 million in the third
quarter of 2011, China Armco said, with a $3.9-million fall in
iron ore sales and a $4.1-million drop in chromium ore
For the first nine months of
this year, China Armco posted a net loss of $3.23 million,
widening from a $1.83-million loss a year earlier, on revenue
that dropped 28.7 percent to $68.94 million from $96.75
Scrap sales accounted for $25
million of total revenue, down from $36.8 million in the first
nine months of last year, and metal ore trading contributed
$43.9 million, down from $59.9 million, the company said.