South Korean steelmaker, Posco Holdings, reported a net loss for the fourth quarter of 2024, missing market expectations. The loss was due to lower steel and energy material prices, which put substantial pressure on the company's profit margins.
Looking at the full year, Posco's net profit nearly halved to 948.00 billion won, and operating profit plummeted 38% to 2.174 trillion won. This occurred as revenue decreased by 5.8%, settling at 72.688 trillion won for the year.
Posco announced that weak demand both domestically and internationally, coupled with an oversupply of steel products from China, had flooded the global markets, contributing to its financial downturn.
The company's financial woes were further compounded by heavy asset-impairment and inventory-valuation losses, which were recognized after the suspension of operations at some of its older steel mills. This suspension was a response to the industry's downturn.
Posco's net loss for the fourth quarter amounted to 703.00 billion won, approximately $482.3 million, following three profitable quarters. This figure fell short of a consensus estimate for a profit, as compiled by FactSet.
The company reported revenue of 17.805 trillion won for the quarter, with an operating profit of 95.00 billion won. These figures marked a significant reduction from the previous quarter's results.
Posco's main steel business registered a net loss of 6.00 billion won, as it grappled with lower steel prices and rising operating costs in the face of declining sales.
Source:Investing.com
