Booming steel prices that plagued much of West Midlands industry last year have given a huge boost to the recovery of Corus.
Formed by the 1999 merger of British steel with the Dutch Hoogovens, Corus returned decisively to profit in 2004 after it succeeded in passing on to its customers rocketing costs of coking coal, iron ore and scrap.
Although these added nine per cent to its operating costs, Corus achieved an operating margin of 13 per cent in the second half of 2004.
Yesterday it reported a pretax profit of £559 million on sales of £9.3 billion, up from a £255 million loss in 2003 and years of earlier losses.
The second half- year accounted for £435 million of a £582 million operating profit.
But Philippe Varin, chief executive, acknowledged: "There would have been no profit without the price increases".
Corus finished the year with a strong balance sheet. Net debt of £854 million has fallen by 30 per cent since June and now represents only 27 per cent of shareholders' funds.
Despite that, there is still no dividend - the last one was paid five years ago - only a statement that the directors' "current intention" is to recommence pay-outs for 2005. Mr Varin said there was no market expectation of a dividend for 2004.
The shares still dipped 11/2p to 56p, equivalent to 5.6 times last year's earnings.
This was partly because of cautious remarks by Mr Varin about prospects for this year.
"Global growth remains relatively strong and the demand/supply balance is tight by historical standards, generally supportive of a positive outlook for 2005," he said.
"Overall, we expect the first half trading environment to be broadly in line with the second half of last year. As the year progresses we see conditions as more uncertain." Mr Varin said Corus would seek to recover raw material cost rises through raising its selling prices further. It is set to pay 72 per cent more for its iron ore in 2005.
He pointed out that all steel-makers around the world are suffering from the same cost increases, so none are in a position to under-cut its rivals
"It is our intention to resume the recovery of the prices of raw materials," he insisted.
Corus had already won "significant" prices in annual contracts agreed with its customers in January. These account for 40 per cent of its business.
But Patrick Flockhart, managing director at Steel Business Briefing, said Corus will probably have to absorb most of the higher raw material prices - which could add up to 25 per cent to its costs.
"We reckon the effect of iron ore, freight, coking coal will be up to $100 a tonne, so there is going to be a price cost squeeze over the coming year," he said.
" Prices have probably peaked ... and may actually start coming down a little bit, which suggests the cash-flow situation might not be quite as good in the foreseeable future."
The big question was whether Chinese demand, which sustained prices in the face of static US and European markets, would grow in the second half, Mr Flockhart added.
A drastic restructuring programme accounted for about 30 per cent of last year's recovery, Mr Varin said. Corus has cut about 13,000 jobs since 1999.