In 2018, despite the severe global economic situation, slowing economic growth, declining demand, and prevalence of trade protectionism, Posco has achieved remarkable results.

On January 30, 2019, South Korea's Posco Steel announced its consolidated financial statements for the first time since 2011. According to the report, in 2018, Posco's consolidated sales revenue was approximately 64.98 trillion won (approximately US$57.826 billion), which was the company's second consecutive year of sales revenue exceeding 60 trillion won, an increase of 7.1% year-on-year; operating profit It is about 5.54 trillion won (about 4.93 billion US dollars), up 19.9% year-on-year. The last time the company's operating profit exceeded 5 trillion won was in 2011; the net profit was about 1.89 trillion won (about 1.682 billion US dollars). ).

High value-added products set development trend

The increase in production and sales of high value-added steel is the main reason for the outstanding performance of Posco.

After the expansion of the Pohang No. 3 blast furnace (4,350 cubic meters before the renovation and 5,600 cubic meters after the transformation), the production and sales volume of high-end products, which accounted for 55.1% of the total sales volume of Posco's iron products, increased significantly, driving the growth of overall operating profit.

At the same time, in 2018, the profitability of all subsidiaries of Posco and domestic and foreign companies improved in an all-round way, such as the Krakato Pohang Steel Company, the Maharashtra Pohang Steel Company, and the Pohang Chemical Technology Company. Sales performance has broken the historical record.

In 2018, Posco's consolidated net income decreased by 36.4% year-on-year, mainly due to the impairment of assets and equity securities of Posco's subsidiaries, the decrease in short-term securities sales, and the increase in corporate tax expenses.

In 2018, the financial status of Posco was continuously improved. In 2018, Posco made a loan of 854.4 billion won (about 760 million U.S. dollars), and the total debt fell. At the same time, however, the company also repaid 1.16 trillion won (approximately $1.032 billion) of hybrid securities (the maturity of hybrid securities can be extended according to the decision of the company’s executives, and capital is included in the accounting), and the share capital has The decline led to a slight increase of 0.8 percentage points to 67.3% in the consolidated debt-to-equity ratio. In addition, the ratio of Posco's debt to EBITDA (earnings before interest, taxes, depreciation and amortization) fell from 2.9 in 2017 to 2.5 in 2018, in line with the credit rating requirements of global credit rating agencies.

For the past seven years, Posco has been paying a dividend of 8,000 won ($7.13) per share. In order to increase shareholder returns, in 2018, Posco's board of directors decided to raise the dividend per share to 10,000 won (about 8.91 US dollars), which is the first time since Posco increased dividends per share since 2011.

Mid-term management strategy for future development

On January 30, Posco also announced its mid-term management strategy. The goal is to adjust the combined profit margins of steel, non-steel and emerging industries from the previous 49%, 50% and 1% to 2021, respectively. 44%, 53% and 3%; consolidated sales amounted to 78 trillion won (about 69.413 billion US dollars), and the combined debt-to-equity ratio reached 65%.

In the steel industry, Posco will continue to increase production and sales of high value-added products in response to the impact of trade protectionism; in the non-steel sector, reforms will be implemented through trade practices and profit models in the trade, construction and energy sectors. To enhance market competitiveness.

In the new growth area, Posco Chemical Technology and Posco Steel ESM will complete the merger and maximize synergies to improve the market competitiveness of Posco's secondary battery anode materials.

Green product certification paves the green road

Recently, five products such as steel plate, wire rod, hot-rolled galvanized sheet, gigabyte steel (980DP) and high corrosion-resistant steel plate produced by Posco have passed carbon footprint, resource footprint, ozone layer effect, acid rain, eutrophication, The seven environmental indicators, such as photochemical smog and water footprint, became the first Korean steel company to receive the Environmental Product Certification (EPD) from the Ministry of Environment of Korea.

In recent years, the demand for environmentally friendly products in the Korean steel construction materials market is growing, and the Korean government has introduced measures to build buildings that use environmentally-friendly product certification, such as meeting the Green Standard for Energy and Environmental Design (G-SEED). , you can get relevant rewards. Therefore, the demand for environmentally friendly materials in the Korean market will further increase in the future.

Posco said that obtaining environmentally-friendly product certification will enhance the market competitiveness of its products and also prove that steel products are sustainable.

It is understood that the Environmental Protection Product Certification of the Ministry of the Environment of Korea was first launched in 2001 and was implemented by the Korea Institute of Environmental Industrial Technology under the supervision of the Ministry of the Environment to promote sustainable consumption. Up to now, 461 products in Korea have obtained this certification.