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The 1Q Consolidated Operating Profit of POSCO Amounted to KRW 1.365 Trillion

Date
Apr. 18, 2017
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  • - Its consolidated sales reached KRW 15.0772 trillion, and its operating profit increased by 189.4% QoQ.
    - Its separate sales amounted to KRW 7.0674 trillion and its operating profit KRW 795.4 billion··· Its operating profit ratio is 11.3%.
    - POSCO will continue its restructuring until year end, and cut the number of domestic affiliates to 32.

    On April 18, POSCO announced on that its consolidated sales amounted to KRW 15.0772 trillion, its operating profit KRW 1.365 trillion, and its net profit KRW 976.9 billion in the first quarter.

     

    The consolidated sales slightly increased QoQ, and thanks to the increased profits of the steel division, as well as the improved performance of its non-steel divisions, such as trading and E&C, its operating profit went up by 189.4% QoQ. The operating profit ratio rose by 6%p from 3.1% to 9.1%.

     

    Looking at the aggregate operating profit of each division, the aggregate operating profit of the steel division and the trading division increased by 60.8% and 60% QoQ to KRW 1.0234 trillion and KRW 126.7 billion respectively, and the E&C division turned a profit. The aggregate operating profit of the energy division increased by 26.7% QoQ to KRW 75 billion.

     

    The performance of its major overseas steel subsidiaries greatly improved, contributing to the increase of the overall operating profit.

     

    The operating profits of its stainless steel production subsidiary with China Zhangjiagang Pohang Stainless Steel (ZPSS), and its cold rolling mill with India POSCO Maharashtra went up by 41.7% and 80% QoQ to KRW 52 billion and KRW 38.7 billion respectively.

     

    The operating losses of its integrated steel mill with Indonesia PT.KRAKATAU POSCO, and its bar and shaped steel mill with Vietnam POSCO SS-VINA were greatly reduced.

     

    The separate sales and operating profit of POSCO increased by 9.7% and 63% QoQ to KRW 7.0674 trillion and KRW 795.4 billion respectively, while its net profit resulted in KRW 839.6 billion.

     

    Due to the expansion and repair of Pohang blast furnace #3, its production and sales volume slightly declined from the previous quarter, but the share of sales of its WP (World Premium) products increased by 2.4%p QoQ to 53.4%. Thanks to the increased sale of its higher value-added products, cost reduction, continued efforts to improve profitability, and the rise in steel price, its operating profit ratio increased by 3.7%p QoQ to 11.3%.

     

    Its debt-to-equity ratio was separate 17.6% and consolidated 71%, down by 1.6%p and 6%p YoY respectively. POSCO is making continued efforts to improve its financial health.

     

    Meanwhile, POSCO is planning to finalize its restructuring efforts, which have been ongoing since the inauguration of POSCO CEO Ohjoon Kwon, by reducing the number of its domestic affiliates from 49 in 2014 to 32 by the end of this year, and prepare for the next 50 years through Smart Transformation based on the core competencies of the Group.

     



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