POSCO Q4 profit misses forecast on stronger won, weak demand

SEOUL Tue Jan 28, 2014 12:28pm IST

A worker uses his mobile phone during a break at a steel works in Seoul October 23, 2012. REUTERS/Kim Hong-Ji/Files

A worker uses his mobile phone during a break at a steel works in Seoul October 23, 2012.

Credit: Reuters/Kim Hong-Ji/Files

Related Topics

Stocks

   

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)

FILED UNDER:
Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.

  • Most Popular
  • Most Shared

REUTERS SHOWCASE

Adani Project

Adani Project

Australia approves Adani's $16 bln Carmichael coal project  Full Article 

India-U.S. Talks

India-U.S. Talks

Kerry to woo Modi's India, but quick progress unlikely  Full Article 

Paring Debt

Paring Debt

Jaiprakash to sell hydro plants to Reliance Power  Full Article 

Nifty Falls

Nifty Falls

The broader index hits lowest in nearly a week on profit taking  Full Article 

Mideast Conflict

Mideast Conflict

U.N. Security Council calls for humanitarian ceasefire in Gaza  Full Article 

Market Eye

Market Eye

Foreign investors prefer Indian cyclicals, utilities - Macquarie  Full Article 

Debt Investment

Debt Investment

India's FII debt limit hike credit-positive, says Moody's  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device.  Full Coverage