Mainboard-listed Union Steel Holdings, one of the largest metal recyclers in Singapore, says the group achieved a net profit of $4 million for the financial year ended 30 June 2010, reversing the previous year’s losses of $6 million.

Union Steel says group revenue declined 59% to $130.1 million from $317.5 million, on the back of lower exports of non-ferrous metals to China. Gross profit edged lower to $11.2 million from $12.2 million previously. This was because gross margins improved 4.8 percentage points as a result of a higher-margin product mix and higher selling prices.

Profit from operations was $5.1 million as the group kept a tight lid on costs and reduced foreign exchange losses. Finance costs also halved to $1.1 million due to lower interest rates.

4QFY10’s revenue fell 62.9% to $31.0 million due to lower exports to China but gross profit rose marginally to $3.1 million as margins improved. Gross profit margin was up 6.6 percentage point to 10.1% due to a higher-margin product mix as well as higher selling prices.

There was a reclassification of provisions for impairment in the value of inventories which offset a $1 million gain from the fair value of investment properties. As a result, profit from operations was $1.3 million while net profit was $1.2 million, compared to $1.0 million and $0.6 million respectively in the previous year.