SEOUL (Reuters) - South Korean steelmaker POSCO reported a drop of 84.3% in second-quarter operating profit, as the coronavirus pandemic dented steel demand, the company said on Tuesday.
POSCO said it expected steel demand to recover from the third quarter but revised down its 2020 sales outlook to 55.4 trillion won ($46.24 billion) from its April forecast of 57.5 trillion.
The world’s fifth-biggest steelmaker said in a statement it recorded a consolidated operating profit of 168 billion won in the April-June quarter, versus 1.1 trillion a year earlier.
That missed an average estimate of 291 billion won from 14 analysts, according to Refinitiv.
POSCO’s second-quarter revenue fell 15.9% to 13.7 trillion won, while net profit dropped 84.6% to 105 billion.
In the midst of the pandemic, steel demand from automakers and construction companies, among others, has weakened during lockdowns to limit spread of the virus.
Global steel demand is expected to fall 6.4% this year as the pandemic has slowed industrial activity, the World Steel Association said last month.
POSCO shares rose 1.9% by 0455 GMT after the results, while Seoul’s KOSPI benchmark gained 1.6%.
Reporting by Jane Chung; Additional reporting by Joori Roh; Editing by Muralikumar Anantharaman and Clarence Fernandez