ISTANBUL

Japan's largest steel producer Nippon Steel said Friday that it expects its net profit for the fiscal year 2025 to fall by 42.9%.

The company estimated that its net profit for fiscal 2025 will decline to 200 billion yen ($1.38 billion), according to the company's financial results.

The company's net profit for the 2024 fiscal year ending in March 2025 fell 36.2% compared to the 2023 fiscal year to 350.2 billion yen ($2.4 billion).

It was stated that inflation in the country reduced demand for products and the slowdown in the Chinese economy negatively reflected on the decline in net profit.

The company's operating profit fell 29.6% to 547.9 billion yen ($3.77 billion), while sales revenues fell 1.9% to 8.7 trillion yen ($59.9 billion).

At a press conference in Tokyo, Nippon Steel President Tadashi Imai said that they do not expect financial conditions to improve in the current fiscal year.

“The indirect impact of the US tariffs on our earnings could be significant,” he added, while noting that direct effects will be limited as exports to the US are small and consist of mainly hard-to-substitute products.

Meanwhile, the $15 billion offer made by Nippon Steel to acquire US Steel, which was turned down by former US President Joe Biden, is being examined.

“We’ll take all necessary steps to ensure the transaction closes,” Imai said.

Imai restated that although Nippon Steel is considering other options to gain clearance, its primary offer to purchase complete control of US Steel continues to be the starting point in talks with US authorities.

When he first took office on Jan. 20, US President Donald Trump said he "wouldn't mind" if Nippon Steel acquired a minority position in US Steel. The transaction structure would need to be revised in such a situation.

The Tokyo-based company, whose official name is “Nippon Seitetsu,” is known as Japan's largest and the world's fourth largest crude steel producer.