SEOUL (Reuters) - South Korean steelmaker POSCO (005490.KS), backed by billionaire investor Warren Buffett, reported a smaller-than-expected 29 percent gain in quarterly operating profit as the stronger won and weak demand sapped steel prices.
POSCO, the world's fifth-biggest steelmaker, said on Tuesday its October-December operating profit was 488 billion won on a parent basis that does not reflect earnings of affiliates.
The fourth-quarter profit was below an average forecast of 557 billion won and compared with an operating profit of 379 billion won a year earlier.
A prolonged downturn in the steel industry shows no signs of letting up, pressured by China's excess capacity coupled with slowing demand in the world's top steel consumer.
The South Korean won's strength against major currencies eroded POSCO's repatriated earnings overseas and its export margins as Japan's Nippon Steel & Sumitomo Metal (5401.T) forecast a nearly four-fold jump in annual profit, fueled by a weaker yen.
POSCO shares, of which Buffett's Berkshire Hathaway Inc (BRKa.N) owns around 5 percent, ended down 0.5 percent prior to the results on Tuesday. Its shares fell 9 percent this year, lagging the wider market's 4.7 percent drop.
(Reporting by Hyunjoo Jin; Editing by Matt Driskill)
Trending On Reuters
Two founding members of anti-establishment political Aam Aadmi Party (AAP) were ousted from its top decision-making panel on Saturday, deepening the rift in the party that is seen as a potential challenger to Prime Minister Narendra Modi. Full Article
Iran, powers close in on 2-3 page nuclear deal; success uncertain - officials Full Article