South Korean steel giant, POSCO, released its CY’23 results on 31 January 2024. The company’s annual crude steel production and sales volume showed growth y-o-y.
1) Crude steel production increases y-o-y: The company’s crude steel production stood at 35.685 million tonnes (mnt) in CY’23, up 4% as against 34.219 mnt an year ago.
2) Sales up y-o-y: The company’s sales went up by 3% y-o-y to 33.143 mnt in CY’23 in comparison with 32.144 mnt in the previous year (CY’22).
The company’s production and sales performance saw improvement compared to the previous year. Despite facing early recovery challenges due to flooding at the Pohang Steel Mill last year, POSCO swiftly stabilized operations and ramped up production and sales. This resulted in a y-o-y increase of 1.716 mnt for carbon steels and 156,000 tonnes (t) for STS products, respectively, reaching annual totals of 31,927,000 t and 1,633,000 t.
Other highlights:
Revenue declines y-o-y: The company’s revenue from steel sales declined by 9% to KRW 38,972 billion in CY’23 from KRW 42,695 billion in CY’22.
POSCO’s revenue dipped y-o-y amid worsening global markets. The price drop of finished goods in Q4, despite the continued strength of raw materials like iron ore and coking coal, significantly impacted company performance.
Krakatau POSCO: The joint venture between Krakatau and POSCO, Korea reported a significant decline in operating profits whereas, slight upward trend in revenue. Operational profits of the company declined by 31% q-o-q from $39 million in Q3CY’23 to $27 million in Q4CY’23. However, operational profit fell by 20% y-o-y to $177 million. Moreover, revenue rose by 3% y-o-y to $2,397 million in CY’23 against $2,328 million in CY’22. Despite challenging market conditions, the company’s focus on cost control and domestic HR sales growth helped mitigate a decline in operating profit.
POSCO Maharashtra performance: POSCO’s Maharashtra-based unit recorded decline in revenue by 9% y-o-y to $1,350 million in CY’23 against $1,479 million in CY’22. However, operating profit hiked by 2.5% q-o-q to $28 million in Q4CY’23 compared to $8 million in Q3CY’23, also, the same climbed by 92% y-o-y to $75 million in CY’23. The automotive sector saw profits rise despite lower sales prices, driven by strong sales volume growth.
POSCO International performance: POSCO International reported decline in steel revenues at KRW 7,909 billion ($6 billion) in Q4CY’23, edged down by 2% q-o-q against KRW 8,046 billion ($6 billion) in Q3CY’23. Moreover, the same declined by 21% y-o-y to KRW 33,133 billion ($25 billion) against KRW 41,697 billion ($31 billion) in CY’23.