POSCO Holdings said on the 30th that, on a consolidation basis, its operating profit for the first quarter was tentatively tallied at 710 billion won, up 24.3% from the same period a year earlier.
During the same period, revenue was tentatively tallied at 17.88 trillion won, up 2.5%, and net profit was 540 billion won, up 57.9%.
The first-quarter operating profit of POSCO Holdings announced that day beat market expectations. FnGuide's first-quarter operating profit consensus for POSCO Holdings was 594.9 billion won, 16.2% lower than the announced figure.
POSCO Holdings said first-quarter results were positively affected as losses in the lithium division were greatly reduced with POSCO Argentina beginning full-scale commercial production.
By business division, POSCO was tentatively tallied with first-quarter operating profit of 213 billion won and revenue of 8.935 trillion won, down 38.4% and 0.4%, respectively, from a year earlier.
POSCO said crude steel production and product sales volume increased, but operating profit fell due to higher raw material unit costs, exchange rates, and freight.
In the overseas steel division, operating profit at the Indonesia establishment rose sharply. The establishment's first-quarter operating profit was 20 billion won, up 185% from the same period a year earlier.
During the same period, revenue was 664 billion won, down 1.8%. The company said margins improved through expanded exports, including to Europe, and efforts to strengthen cost competitiveness.
At the Vietnam establishment, first-quarter operating profit rose 233.3% to 1 billion won during the same period, but revenue was tallied at 98 billion won, down 6.7%.
During the same period, the China establishment's operating balance recorded a loss of 2 billion won, narrowing the loss by 17 billion won. Revenue was 363 billion won, down 46%.
At the India establishment, revenue during the same period rose 7.3% to 498 billion won, but operating profit was tallied at 31 billion won, down 49.2%.
The company said that despite the seasonal off-peak period, overall profitability improved in the overseas steel division as well through expanded sales and cost-reduction efforts.
POSCO FUTURE M posted first-quarter operating profit of 18 billion won, up 5.9% from a year earlier, while revenue fell 10.3% to 758 billion won.
POSCO FUTURE M said it recovered profitability in the energy materials division by increasing sales through diversifying customers and leveraging a recovering market, and in the basic materials division it increased operating profit through facility efficiency improvements despite lower sales volume.
POSCO International recorded first-quarter operating profit of 358 billion won, up 32.6% from a year earlier, and revenue also increased 3.1% to 841 billion won.
The company said it maintained solid profit by increasing sales across major businesses such as power generation, steel, Indonesian palm plantations, and gas fields, leveraging favorable market conditions.
POSCO E&C said first-quarter operating profit was 53 billion won, up 120.8% from the same period last year. Revenue during the same period was tallied at 1.68 trillion won, down 7.4%.
It said revenue fell due to delays in some processes, but operating profit increased due to higher contract amounts and lower SG&A expenses, with continued orders from group companies and urban redevelopment projects also having an impact.
POSCO Holdings also unveiled the results of investments for a closed-loop localization strategy in the steel division and a transition to decarbonization that day. On the 20th, it signed a joint venture agreement (JVA) with India's No. 1 steelmaker JSW Steel, establishing an integrated production system with annual capacity of 6 million tons (t).
By finally completing the facilities in 2031, the plan is to use locally sourced low-cost iron ore to produce high-strength and highly corrosion-resistant steel, which have limited local supply, and secure a stable profit base in the Indian market.
The company also said that approval for changes to the Pohang National Industrial Complex plan has enabled site preparation for hydrogen reduction steelmaking, and in Gwangyang it plans to start up a new electric arc furnace with annual capacity of 2.5 million t in June.
POSCO Holdings also announced a midterm shareholder return policy to be implemented over two years starting this year. The gist is to move away from a dividends policy based on free cash flow and adopt a performance-linked shareholder return policy based on adjusted net income attributable to owners of the parent.
Adjusted net income attributable to owners of the parent is defined as the figure excluding non-operating and one-off valuation gains and losses from net income attributable to owners of the parent, and the shareholder return ratio target is set at 35% to 40%. Within that range, the plan is to operate cash dividends and new share repurchases and cancellations.
Regarding the decision to directly hire some partner company employees, the company said the scale of expense increases would not be large. Earlier, POSCO said it would directly hire about 7,000 partner company employees working in operations support at the Pohang and Gwangyang steelworks as a different "Synergy (S) job group" from the existing regular workforce.
A POSCO Holdings official said, "Some expense increases such as labor costs and employee benefits are inevitable, but after direct hiring, the command-and-control system will be unified, which will help strengthen the company's competitiveness," adding, "In the long term, there may be no major increase in the expense aspect."