South Korean steelmaker POSCO’s profit rose by 10 percent
By Jane Chung
SEOUL, Jan 30 (Reuters) – South Korean steelmaker POSCO’s core fourth-quarter profit rose 10 percent on higher sales and profit margins, meeting analysts’ forecasts, and the firm lifted its 2019 sales outlook citing firm demand from India and Southeast Asia.
The world’s fifth-biggest steelmaker released 2018 earnings in a filing on Wednesday without disclosing fourth-quarter figures. But Reuters’ calculations showed consolidated operating profit for October-December was 1.3 trillion won ($1.16 billion), up from 1.2 trillion won a year ago.
Analysts had forecast an average estimate of 1.3 trillion won according to a I/B/E/S Refinitiv poll.
Revenue for the quarter climbed 6.4 percent to 16.6 trillion won, according to the calculations. For 2019, POSCO said revenue is expected to rise 2 percent to 66.3 trillion won, from 65.0 trillion won in 2018.
POSCO said it expected steady global steel demand growth in 2019. While India and Southeast Asia demand should grow, Chinese demand may remain flat as economic growth cools.
Steel prices in China, the world’s biggest consumer and producer of the construction material, have fallen about 27 percent since October, dragged down by concerns over oversupply and the Sino-U.S. trade dispute.
Meanwhile, POSCO said it expected to increase capital expenditure and other investments to 6.1 trillion won this year from 2.7 trillion won in 2018.
POSCO shares ended up 6.2 percent before the earnings announcement, lifted by investor expectations that steel prices will rise following the deadly collapse of a dam operated by Brazilian iron ore miner Vale. The Seoul stock market’s KOSPI benchmark was 1.1 percent higher. ($1 = 1,117.0900 won) (Reporting by Jane Chung and Ju-min Park Editing by Kenneth Maxwell)