|
|
|
| NEWS |
|
|
|
| Welcome to Wanjoo Metals |
HOME > CUSTOMER CENTER > NEWS |
|
|
|
|
| TITLE |
Posco Profit Almost Triples to $989 Million on Higher Steel Prices, Demand |
| WRITER |
administrator |
DATE |
2010-07-13 17:19:46 |
|
|
|
Posco Profit Almost Triples to $989 Million on Higher Steel Prices, Demand
Tue. Jul 13. 2010
Posco, Asia’s third-largest steelmaker, posted its third straight gain in quarterly profit after increasing prices and production on revived demand from automobile and appliance makers.
Second-quarter net income almost tripled to 1.2 trillion won ($989 million) from 430.5 billion won a year ago, Pohang, South Korea-based Posco said today in a statement. That fell short of the 1.46 trillion won average of 22 analysts’ estimates compiled by Bloomberg. Sales in the three months ended June 30 gained 25 percent to 7.93 trillion won.
Posco, part-owned by Warren Buffett’s Berkshire Hathaway Inc., and its rivals benefited as a global economic recovery spurred demand for steel used in cars and appliances. The mill, which derives about 70 percent of sales from the domestic market, increased prices by as much as 32 percent this year to offset higher costs of iron ore and coal.
“The earnings look good because Posco raised domestic prices and sales, helped especially by car-sheet demand,” Shin Yoon Shik, an analyst with Meritz Securities Co. in Seoul, said before the announcement.
Hyundai Motor Co. and Kia Motors Corp., South Korea’s biggest automakers, led a 12th straight gain in monthly sales in June, with Hyundai’s sales increasing 11 percent.
Posco, Asia’s biggest mill by market value, fell 0.2 percent to close at 500,000 won today in Seoul. The local benchmark Kospi index was little changed. The announcement came after the stock market closed.
Higher Costs
Crude steel production rose to 8.4 million metric tons in the second quarter from 7.1 million tons a year ago, the company said in a separate statement today. Product sales rose to 7.8 million tons from 7 million tons, it said.
Posco has fallen 19 percent this year on concern steelmakers may fail to pass on increased costs to customers. Brazil’s Vale SA, the biggest supplier of iron ore, and BHP Billiton Ltd. this year broke with a 40 year-tradition of setting annual prices for iron ore and coal, winning as much as a 90 percent gain for April quarter contracts.
“Profit margins in the current quarter may shrink marginally as its latest price increases fell slightly short of cost gains.” Meritz Securities’ Shin said.
Second-quarter operating profit was 1.84 trillion, Posco said today. Then company raised its full-year forecast for operating profit to 5.6 trillion won and sales to 33.5 trillion won.
JFE Holdings Inc., Japan’s second-largest steelmaker, and two rivals agreed to a 12.5 percent price increase for coking coal with BHP Billiton for the July quarter contracts, three people with knowledge of the agreements said last month.
Regional steel prices may increase in the fourth quarter with Chinese government spending skewed to the second half because of “stable” steel demand, Park Chan Wook, an analyst with Deutsche Bank AG, said in a June 14 report.
Among Korean mills, Posco will be “the biggest beneficiary” of China’s steel policy changes including the removal of export rebates and a potential appreciation of the Chinese yuan, Kim Jin Mook, an analyst with JPMorgan Chase & Co., said in a July 6 report.
Source from Bloomberg |
|
|
|
|
|
|
| [ L I S T ] |
|
|
|
|
|
|
|
|
|
|
|
|
WanJoo Metals All rights reserved. |
|
TEL : +82-2-585-2581, 2571, FAX : +82-2-585-2587, 8799 |
|
FL.2 DaedeokPlaza Bldg, 206, Geumgok-Dong, Bundang-Gu, Seongnam-Si, Gyeonggi-Do 463-480, Korea |
|
|
|
|
|
|
|
|
|
|
|
|
