China Gerui Advanced Materials Group Limited (NASDAQ:CHOP) announced financial results for Q3 2012.
As quoted in the press release:
Gross margin was 15.7% in the third quarter of 2012 compared to 31.7% in the same period of 2011. The decrease in gross margin was due to significant market driven price declines of the Company’s raw materials, a slowdown in China’s economic growth and demand for our products and intensified competition in the Company’s segment of the steel sector. Further, there was additional testing of both the chromium plating line that was temporarily taken offline during August of 2012 as well as the added 100,000-ton wide-strip production line to ensure its improved precision and successful ramp-up.
China Gerui’s Chairman and CEO, Mingwang Lu, said:
We recorded disappointing financial results in the third quarter of the year due to the continued decline in our raw material costs in the third quarter that contributed to an intensified pricing environment and increased competitive pressures.