South Korea’s Pohang Steel demand recovers strongly, profits hit record highs Reuters

© Reuters. File photo: On July 20, 2016, the POSCO logo can be seen at the company headquarters in Seoul, South Korea. REUTERS/Kim Hong-Ji

Joyce Lee

Seoul (Reuters)-Korean steel manufacturer Pohang Steelers (New York Stock Exchange ticker:) Thursday announced its highest quarterly profit in history, as strong industrial demand and soaring steel prices boosted its revenue.

The world’s sixth-ranked steel manufacturer in terms of output by 2020 has announced a plan to increase its annual steel production capacity from 46 million tons in 2020 to more than 60 million tons by 2030.

According to comments in its earnings conference call, the company also raised its 2021 revenue target from 32.8 trillion won to 37 trillion won, as supplies are expected to continue to be tight for the rest of the year, especially in the domestic market.

Data from Refinitiv Smartestimate showed that the consolidated operating profit from April to June was 2.2 trillion won (US$1.91 billion), which was in line with the company’s forecast earlier this month and was slightly higher than the 2.1 trillion won expected by the market.

POSCO reported an operating profit of approximately 170 billion won last year, when sales were hit by the coronavirus pandemic.

Revenue in the previous quarter increased by 33% to 18.3 trillion won.

Analysts predict that in the second half of this year, steel demand in major markets such as the United States and Europe will continue to exceed supply, and steel prices will rise as a result of plans to promote infrastructure spending and reduce carbon emissions.

POSCO’s stock price rose 2.7% after the quarterly data was released, while the broader market rose 1%.

(1 USD = 1,151.6400 KRW)

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