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Top steelmaker Posco estimated to log record earnings for Q2

Posco’s headquarters in Gangnam, Seoul. (Yonhap)
Posco’s headquarters in Gangnam, Seoul. (Yonhap)
South Korea's leading steelmaker Posco is likely to post a record operating income for the second quarter of the year on a recovery in global demand, according to market forecasts Thursday.

Eight local brokerages' median estimate for Posco's operating profit stands at 1.93 trillion won ($1.73 billion) for the April-June, up more than 10 times from a year earlier, according to an analysis of their forecasts by Yonhap Infomax, the financial news arm of Yonhap News Agency.

The figure marks the largest quarterly operating profit since Posco introduced stricter global accounting rules, named the International Financial Reporting Standards in 2011.

Posco registered the biggest quarterly operating income of 1.7 trillion won during the April-June period in 2011. The projection for the current quarter is also up from 1.55 trillion won three months earlier, which was the largest in 10 years.

Of the eight securities companies, Kiwoom Securities Co. and two others forecast Posco's second-quarter operating income to reach the 2 trillion-won range.

Hyundai Steel Co., the second-largest steelmaker, is forecast to chalk up an operating income of 443 billion won for the second quarter, compared with an operating profit of 14 billion won a year earlier.

Rosy forecasts for steelmakers' second-quarter profits come amid surging demand for steel from automakers, shipbuilders and construction firms, which results from the global economic recovery following wider vaccinations against the new coronavirus.

Market watchers also said prices of steel products have risen sharply to improve local steelmakers' profitability, despite rising costs of iron ore. (Yonhap)
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