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Daewoo International net more than sextuples

Daewoo International Corp. on Wednesday posted record revenue and a more than seven-fold surge in net profit for last year, prompted by robust overseas business and increased sales channels linked with its top stakeholder POSCO.

Sales soared 20 percent on-year to nearly 18.8 trillion won ($16.5 billion) in 2011, according to a regulatory filing. Operating profit more than quintupled to 238.8 billion won, while net income topped 160 billion won.

The upbeat results drove up Daewoo shares by 3.13 percent to close at 29,700 won on Wednesday, after breaching the 30,000 won mark during morning trading.

“Despite an overall slump in the industry, POSCO-related operations pushed up the trader’s sales,” said analyst Doh Hyun-woo with KTB Investment & Securities Co.

“Operating profit could go up another 35 percent this year as the company strengthens risk management in the trading field and its Australian mine enters full-fledged production next month.”

Over the past year, Daewoo said it has seen a sharp rise in overseas sales and diversified its income structure thanks to greater access to new markets and broader networks provided by the steel giant.

POSCO, the world’s fourth-largest steelmaker, bought a 68 percent stake in the Korean trading house in August 2010 for 3.37 trillion won as it strives to boost its self-sufficiency in raw materials and ensure smooth supplies.

Daewoo, which chiefly buys and sells steel, metals and auto parts, holds shares in a spate of crude, gas and mineral exploration projects abroad.

By Shin Hyon-hee (heeshin@heraldcorp.com)
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