POSCO Q1 net drops 69 pct on weak demand

SEOUL, April 10 (Yonhap) -- POSCO, the world's fourth-largest steelmaker, said Friday that its first-quarter profit tumbled 69 percent from a year earlier due to declining demand from automakers and builders.

Net profit reached 325 billion won (US$244 million) in the January-March period,
down 68.5 percent from a year earlier, POSCO said in a regulatory filing. Sales
fell 22.1 percent to 6.69 trillion won, with operating income plunging 71 percent
to 373 billion won.
Shares of POSCO closed at 379,500 won on the Seoul bourse, up 1.2 percent. The
fourth-quarter earnings were released after the market's close.
The figures come amid concerns that the global steel industry is facing a sharp
drop in demand resulting from the global economic crisis, causing difficulties
among automakers, electronics companies and shipbuilders.
POSCO lowered its output for the first time in its 41-year history in December as
Hyundai Motor Co. and other carmakers reduced production at home and overseas.
Last month, POSCO said it will extend output cuts into the second quarter from
between 900,000 tons to 1 million tons in crude steel production.
Chief Executive Officer Chung Joon-yang said in February the steelmaker could
maintain output cuts of 6 percent until June, with further reductions possible if
the market fails to recover. The company also said it may cut output by as much
as 800,000 tons in the January-March period.
POSCO forecast earlier that sales would fall by up to 12 percent this year, while
steel output could drop by as much as 12 percent to 29 million tons.
sam@yna.co.kr
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