POSCO sees its Q1 net more than double on higher prices

Published : Mar 30, 2017 - 20:50 Updated : Mar 30, 2017 - 20:50

POSCO, the country's top steelmaker, said Thursday that its first-quarter net profit is estimated to have more than doubled from a year earlier, driven by firm demand and higher prices.

In a regulatory filing, POSCO said its net profit is estimated at 800 billion won (US$716 million) on a consolidated basis in the January-March period, compared with a profit of 338 billion won a year earlier.

Its operating income is forecast to be some 1.2 trillion won, up 82 percent from a year earlier, and its sales are forecast to have shot up 17 percent on-year to reach 14.6 trillion won, the company said.

On a standalone basis, POSCO said its first-quarter net profit is estimated at 780 billion won, up 75 percent from a year earlier, with its sales and operating income expected to rise 21 percent and 27 percent, respectively, to 6.99 trillion won and 740 billion won, it said.

Kwon Oh-joon, chairman of POSCO, gives a presentation on the company`s financial perfomrance and business strategy at a forum on Thursday in Seoul. (Yonhap)

POSCO attributed the sharp improvement of its bottom line to reduced losses at its affiliates and a rise in product prices.

The world's fourth-largest steelmaker returned to the black last year from a year earlier, largely thanks to improved business performance at its overseas affiliates and cost-cutting measures.

It logged a net profit of 1.05 trillion won on a consolidated basis last year, compared with a loss of 96.2 billion won the previous year, the company said earlier.

Operating income gained 18 percent on-year to reach 2.84 trillion won last year, while sales dipped 8.8 percent to 53.08 trillion won over the cited period.

Meanwhile, Kwon Oh-joon, chairman of POSCO, said the steelmaker's operating income would rise to 5 trillion won in 2019.

At a forum held in Seoul, Kwon said his company will focus on expanding the sales of premium steel products and boost its profitability.

POSCO plans to spend 2.5 trillion won on its new businesses over the next three years, with their related sales expected to reach some 11.2 trillion won in 2025, he said.

Kwon was appointed earlier this month to lead the steel giant for another three years.