POSCO, Stable Profit Generation Through Increased Domestic and Eco-Friendly Product Sales
Hyundai Steel, Price Increase Factors for Key Products Such as Automotive Steel Plates and Shipbuilding Heavy Plates
[Asia Economy Reporter Oh Hyung-gil] POSCO and Hyundai Steel, leading steel companies in Korea, both achieved record-breaking performances last year. Favorable factors such as the expansion of high value-added product sales and price increases following the global economic recovery after COVID-19 contributed to this positive trend.
On the 28th, POSCO announced in its earnings report that its consolidated operating profit for last year was tentatively estimated at 9.238 trillion KRW, a sharp increase of 284.4%.
During the same period, sales rose 32.1% to 76.332 trillion KRW, and net profit surged 302.5% to 7.196 trillion KRW.
The company achieved balanced results across each business division. In particular, the steel division saw operating profit increase by approximately 7.16 trillion KRW year-on-year due to increased crude steel and product production volumes and price hikes following the economic recovery.
The global infrastructure division also recorded an operating profit of 1.303 trillion KRW, up 9.7%, driven by improved steel market conditions and strong performance from investment subsidiaries such as the eco-friendly vehicle drive motor business.
In the new growth division, POSCO Chemical’s full-scale mass production of cathode materials led to operating profit more than doubling to 113 billion KRW. As a result, POSCO’s consolidated operating profit margin soared by 7.9 percentage points to 12.1%.
Hyundai Steel also recorded a consolidated operating profit of 2.4475 trillion KRW last year, growing an astonishing 3,251.3% from just 73 billion KRW in 2020.
Sales increased by 26.8% to 22.8499 trillion KRW, and net profit turned positive at 1.5052 trillion KRW.
The growth in performance was driven by price increases for key products such as automotive steel sheets and shipbuilding plates amid a favorable global steel market, as well as strengthened competitiveness through adjustments in low-profit businesses.
Hyundai Steel’s sales volume of high value-added automotive steel sheets rose 6% to 750,000 tons, and profitability improved with price increases. Low-profit businesses such as thin hot-rolled and color steel sheets were discontinued to reduce loss factors. The forging business also achieved profitable management through efficiency improvements after its transition to a subsidiary.
The steel industry continues to present positive outlooks for the global steel market this year. Market demand is expected to keep rising, and supply glut is anticipated to shrink due to China’s production cuts, maintaining firm selling prices. POSCO and Hyundai Steel plan to generate stable profits by expanding sales of high value-added products and focus on discovering future growth engines.
POSCO, having successfully transitioned to a holding company structure, has laid the groundwork for enhancing competitiveness and balanced growth across new businesses beyond steel. It plans to reduce costs through the development of low-carbon operation technologies and energy efficiency improvements, while significantly strengthening new business sectors such as secondary battery materials and hydrogen energy.
Hyundai Steel intends to continue developing new technologies for future industries, high value-added new products, and eco-friendly technologies to ensure sustainable growth.
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