The Wall Street Journal-20080111-Earnings Digest Brief -- Posco- Steelmaker Expects Rebound From 20- Decline in Profit
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Earnings Digest Brief -- Posco: Steelmaker Expects Rebound From 20% Decline in Profit
Posco reported a 20% decline in net profit for the fourth quarter as a drop in stainless-steel sales, exacerbated by a plant shutdown, outweighed the benefits of cost cuts. The South Korean steelmaker said it expects profit to improve this year, fueled by demand from emerging economies, expanded capacity and further cost-cutting. Posco said net declined to 713 billion won ($761 million), from 895 billion won a year earlier. Operating profit fell 20%, to 875 billion won, while sales edged up 0.4% to 5.434 trillion won. Lee Dong-hee, chief finance officer, said Posco will benefit from higher steel demand in emerging countries such as China and India, and in Southeast Asia. The domestic shipbuilding industry is expected to grow 11% this year "and about 55 million tons of steel will likely be consumed in Korea," he said. This year, Posco is forecasting operating profit of 4.8 trillion won on sales of 23.9 trillion won.
