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| POSCO headquarters in Seoul / Korea Times file |
By Yi Whan-woo
POSCO estimated Friday that its operating profit for the second quarter would be 2.2 trillion won ($1.9 billion), its highest quarterly earnings since the steel giant began to disclose such results for guidance in 2006.
This will be the first time the company's quarterly income has surpassed the 2 trillion won mark after it implemented stricter global accounting rules, the International Financial Reporting Standards or IFRS, in 2011.
The company plans to release the details of its second quarter earnings later this month and specify its business plans for the rest of the year during a scheduled conference call to investors, July 22.
The strong preliminary earnings guideline comes amid surging demand for steel from automakers, shipbuilders and construction firms in accordance with the gradual global economic recovery from the COVID-19 pandemic following increased vaccinations.
Friday's release was within an earlier market consensus, analysts noted.
POSCO said sales for the three months ended June 30 jumped 32.85 percent, year-on-year, to 18.22 trillion won.
Market analysts said POSCO will remain strong in terms of sales and profits throughout the year thanks to the continued "favorable market conditions" regarding its core businesses.
"The steel-using industries here will see a shortage in supply in the second half and this will result in price hikes," Hana Financial Investment analyst Park Sung-bong said.
Other steelmakers are also set to report brisk earnings in the second quarter. Local brokerages forecast Hyundai Steel's quarterly earnings to be 436.4 billion won, up more than 31 times from same period in 2020.
Dongguk Steel is likely to see a 47.39 percent year-on-year increase to 147.1 billion won, and Seah Steel Holdings, 77 percent year-on-year to 21.6 billion won.
