By Yuka Obayashi
TOKYO (Reuters) - Japan's top steelmaker Nippon Steel could hasten and extend restructuring measures to contend with the tough business environment created by the Covid-19 pandemic, it said after posting its biggest first-quarter loss since 2012.
The group said in February it would shut nearly 10% of its production capacity, an unprecedented move in the once-dominant Japanese steel industry hit by falling demand at home and competition from China.
Speaking at an earnings news conference, Nippon Steel Executive Vice President Katsuhiro Miyamoto said all the measures announced earlier this year will be moved up and more could be added, without giving further details.
"It will take longer than (after) the global financial crisis (in 2008/09) for steel demand to recover as industry activities around the globe have significantly slowed this time due to the coronavirus pandemic," he said.
The world's third-largest steelmaker posted a net loss of 42 billion yen ($397 million) for the April to June quarter against a profit of 33 billion yen a year earlier, as shipments fell 23% on slumping demand from automakers and other manufacturers.
The group forecast a net loss of 200 billion yen for the April to September half against a profit of 38.75 billion yen a year earlier, and a business loss of 120 billion yen for the year to March, which would be its second straight annual loss.
The struggling company booked a record 431.5 billion yen annual net loss in the year ended in March, as a charge related to plans to shut capacity by 2023 hammered earnings.
Since then it has temporarily closed five of its 15 blast furnaces, cutting about 30% of its capacity including another furnace shut early this year, mostly to cope with dwindling demand due to the pandemic.
"Demand will gradually recover after hitting the bottom in April-September, but not to the levels before the outbreak," Miyamoto said.
Its annual crude steel output is expected to tumble 24% on year to 31.8 million tonnes, it said.
(Reporting by Yuka Obayashi; Editing by Louise Heavens and Jan Harvey)