Nippon Steel posts Q1 profit, f'cast below consensus

TOKYO, July 28 (Reuters) - Nippon Steel Corp (5401.T), the world's fourth-biggest steelmaker, returned to profit in April-June but gave a full-year outlook well below market consensus as slowing growth in China threatens prices and margins.

The company posted 61.89 billion yen ($705 million) in April-June recurring profit -- before tax and one-offs -- reversing a 56.7 billion yen loss a year earlier.

Nippon Steel, which plans an automotive sheet venture with India's Tata Steel Ltd (TISC.BO), predicted full-year profit of 250 billion yen, versus a consensus for around 316 billion yen in a poll of 17 analysts by Thomson Reuters I/B/E/S.

Asian steel mills have been helped by some hefty infrastructure spending in the region, but the outlook is blurred by China and a new pricing scheme for raw materials that has increased earnings volatility.

Nippon Steel shares, which have dropped by about a fifth since early April, were up 1.7 percent at 300 yen in afternoon trade after the results. (Reporting by Yuko Inoue)