ID :
54833
Fri, 04/10/2009 - 19:48
Auther :
Shortlink :
https://www.oananews.org//node/54833
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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.
"Both sales and output dropped sharply, as a global economic slowdown reduced
demand from automakers and electronic companies," POSCO said in a statement. "A
weaker won and high raw material costs also increased production costs, hitting
operating profit."
POSCO said despite these negative factors, it remained profitable on the back of
cost-cutting efforts while some other global rivals are forecast to post
operating losses, it said. The company slashed 415.3 billion won in costs during
the cited quarter, it said.
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.
"The second-quarter may be the worst for POSCO as prices of raw materials are
still high," said Kim Kyong-choong, an analyst at Samsung Securities. "Any
meaningful recovery will begin in the third or fourth quarter as costs for iron
ore and other materials fall and demand for steel rises."
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.
Crude steel output declined 25 percent to 6.15 million tons in the January-March
quarter from a year earlier, it said. Its sales of steel products also fell 25
percent to 6 million tons over the cited period.
Full-year production may drop 15 percent to 28 million tons, it added. In
January, the company forecast production would reach between 29 million tons and
32 million tons.
It also estimated that sales would decline 18 percent to 25 trillion won,
compared with a previous sales projection of between 27 trillion won and 30
trillion won.
POSCO said it plans to spend 7.3 trillion won in upgrading and expanding
facilities, compared with last year's 4.9 trillion won.
"Although current conditions are very challenging, we will continue to expand
investments through cost saving efforts to secure future competitiveness," POSCO
said.
sam@yna.co.k
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.
"Both sales and output dropped sharply, as a global economic slowdown reduced
demand from automakers and electronic companies," POSCO said in a statement. "A
weaker won and high raw material costs also increased production costs, hitting
operating profit."
POSCO said despite these negative factors, it remained profitable on the back of
cost-cutting efforts while some other global rivals are forecast to post
operating losses, it said. The company slashed 415.3 billion won in costs during
the cited quarter, it said.
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.
"The second-quarter may be the worst for POSCO as prices of raw materials are
still high," said Kim Kyong-choong, an analyst at Samsung Securities. "Any
meaningful recovery will begin in the third or fourth quarter as costs for iron
ore and other materials fall and demand for steel rises."
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.
Crude steel output declined 25 percent to 6.15 million tons in the January-March
quarter from a year earlier, it said. Its sales of steel products also fell 25
percent to 6 million tons over the cited period.
Full-year production may drop 15 percent to 28 million tons, it added. In
January, the company forecast production would reach between 29 million tons and
32 million tons.
It also estimated that sales would decline 18 percent to 25 trillion won,
compared with a previous sales projection of between 27 trillion won and 30
trillion won.
POSCO said it plans to spend 7.3 trillion won in upgrading and expanding
facilities, compared with last year's 4.9 trillion won.
"Although current conditions are very challenging, we will continue to expand
investments through cost saving efforts to secure future competitiveness," POSCO
said.
sam@yna.co.k
