Loading...
01/10 23:33
Loading...
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings call summary shows mixed financial performance with steady revenue and operating income, but challenges in steel and battery segments. Positive elements include improved debt management and infrastructure profits. The Q&A reveals uncertainties in price negotiations and market demand, but potential growth in India and Southeast Asia. Despite cautious optimism and strategic initiatives, the lack of strong positive catalysts and ongoing challenges suggest a neutral stock price reaction over the next two weeks.
Sales KRW 18.321 trillion, similar to the previous quarter; sluggish performance in steel and rechargeable batteries affected results.
Operating Income KRW 743 billion, similar to the previous quarter; impacted by sluggish performance in steel and rechargeable batteries.
EBITDA KRW 1.75 billion; no specific year-over-year change mentioned.
Steel Operating Profit KRW 466 billion, down KRW 31 billion from the previous quarter; deterioration in profitability of Chinese subsidiaries and sluggish steel demand in China.
POSCO Operating Profit KRW 438 billion, improved by KRW 20 billion; improvement attributed to lower fixed costs due to increased production volumes.
Infrastructure Segment Operating Profit KRW 449 billion, up KRW 20 billion; profit improved due to high power generation profit.
Future M Operating Profit Profit shrunk due to lower anode active material sales volume and losses in cathode material; initial costs of production entities reflected.
Crude Steel Production 9.234 million tons, increased by 1.233 million tons from the previous quarter; normalization after completion of the Pang number four blast furnace.
Revenue from POSCO KRW 9.479 trillion; sales price reduced by KRW 43,000 per ton, leading to a slight reduction in margin.
Cash from Restructuring KRW 625.4 billion freed up from restructuring noncore assets; total of 55 restructuring targets identified.
Investment in India (Joint Venture with JSW Group) 50-50 investment for a 5 million ton capacity integrated steel mill; expected to generate about KRW 4.5 trillion EBITDA over four to five years.
Lithium Production Capacity 25,000 tons of lithium hydroxide from POSCO Argentina Phase 1; initial production of 200 tons completed.
Lithium Price Falling below $10,000 per ton; rapid price decline exacerbated by time lag in buying and selling.
Lithium Hydroxide Production: Lithium hydroxide prices have fallen below $10,000 per ton, impacting profitability. Initial production of 200 tons from the POSCO Argentina Brine Lithium Phase 1 plant has been completed.
Silicon Solution Plant: The Silicon Solution plant is set to be commissioned next week, with ongoing negotiations for product certification with various companies.
Indian Steel Market Expansion: POSCO has signed an MOU with JSW Group to build an integrated steel mill in India with a capacity of at least 5 million tons, focusing on premium automotive steel products.
Market Demand in India: India's steel demand is projected to grow significantly, with per capita consumption currently at 90 kg, only 40% of the global average.
Restructuring Non-Core Assets: POSCO has added five more restructuring targets, totaling 55 low-margin businesses and 70 non-core assets, freeing up KRW625.4 billion in cash.
Production Capacity Increase: The POSCO Argentina Phase 2 plant is expected to be completed in Q3 2024, increasing lithium hydroxide production capacity to 50,000 tons.
Strategic Alliance with JSW Group: The partnership aims to address global steel market shifts and enhance localization in key markets, moving towards upstream business strategies.
Carbon Neutrality Goals: POSCO aims for carbon neutrality by 2050, with plans to implement advanced technologies in the new Indian facility.
Steel Price Decline: Steel prices fell slightly deeper than anticipated, impacting overall profitability.
Battery Materials Pricing: Key raw materials prices for rechargeable battery materials, particularly lithium hydroxide, have declined significantly, creating a challenging business environment.
Initial Investment Costs: New lithium production plants entail initial investment and operational costs, adding to overall expenditures.
Geopolitical Risks: The formation of steel market blocks globally due to geopolitical risks and protectionist trade tendencies may affect supply chains.
Market Competition in India: The Indian steel market is characterized by strong competition, with the top five steelmakers holding over 60% market share, indicating an oligopoly.
Economic Factors in China: Sluggish steel demand in China continues to impact profitability, with no concrete signs of recovery.
Cost Recovery Delays: Due to a sluggish market, cost recovery continues to be delayed in both steel and battery materials businesses.
Restructuring Challenges: Restructuring nonessential businesses and nonperforming assets may incur one-time expenditures and potential losses.
Carbon Neutrality Concerns: Investments in India must align with carbon neutrality goals, raising concerns about emissions calculations and compliance.
Lithium Price Volatility: Rapid price declines in lithium are exacerbated by the time lag between purchase and sale, creating additional challenges.
Strategic Alliance with JSW Group: POSCO Group signed an MOU with JSW Group to build an integrated steel mill in India with a capacity of at least 5 million tons, focusing on premium automotive steel products.
Upstream Business in India: POSCO aims to shift from downstream growth strategies to early entry into upstream markets, responding to global steel market block formations.
Market Position in India: POSCO holds a 28% market share in automotive coated steel in India, with plans to leverage existing networks for the new upstream facility.
Restructuring Nonessential Businesses: POSCO is committed to restructuring nonessential businesses and nonperforming assets to enhance capital efficiency.
Investment in Lithium Production: POSCO is ramping up lithium production with new plants in Argentina and aims to secure key mineral acids amid declining lithium prices.
Fourth Quarter Expectations: For the fourth quarter, POSCO expects raw material prices to decline further, with slight increases in production and sales volumes compared to Q3.
Long-term Financial Goals: By the end of 2026, POSCO aims to generate KRW2.6 trillion in cash through restructuring efforts.
CapEx for Indian Project: POSCO plans to invest approximately KRW5 trillion in the joint venture with JSW Group, generating an estimated KRW4.5 trillion in EBITDA over four to five years.
Lithium Production Capacity: By the end of next year, POSCO expects to achieve a production capacity of 89,500 tons of lithium hydroxide.
Profitability Outlook: Despite challenges, POSCO aims to maintain profitability through high-value long-term contracts and efficient production management.
Shareholder Return Plan: POSCO Holdings is committed to sound profit management and enhancing capital efficiency. They have initiated a restructuring program targeting nonessential businesses and nonperforming assets, which has already freed up KRW625.4 billion in cash. The company aims to reach KRW2.6 trillion in cash by the end of 2026 for future investments. Additionally, they are focusing on a joint venture with JSW Group in India, which involves a 50-50 investment in an integrated steel mill with a capacity of at least 5 million tons, targeting high-end automotive steel products.
The earnings call indicates declining financial performance with a 9% revenue drop and a 27% operating profit decline. Softening EV demand, inventory valuation losses, and regulatory challenges add to the negative outlook. While the dividend payout and share repurchase plans are positive, they are overshadowed by geopolitical risks and economic uncertainties. The Q&A section does not provide additional clarity, maintaining a negative sentiment. Overall, the financial challenges and lack of positive forward guidance suggest a negative stock price reaction.
The earnings call reveals several concerns: lack of share buybacks or dividend announcements, uncertainty in the steel market, and challenges in expansion due to export quotas. The Q&A section highlighted unclear management responses regarding performance improvements and future projections, along with potential capital needs. Despite improved financials, the absence of positive shareholder return plans and market volatility suggest a negative sentiment, likely leading to a stock price decrease of -2% to -8%.
The earnings call summary shows stable financial performance with improved margins and strategic divestitures. However, the Q&A reveals uncertainties in restructuring, capital raising, and trade barriers, with management providing vague responses on key issues. The lack of clear guidance and potential challenges in energy materials and trade barriers offset positive aspects like increased sales in high-demand materials. This results in a neutral outlook, as positive factors are balanced by uncertainties and lack of clear future guidance.
The earnings call summary shows mixed financial performance with steady revenue and operating income, but challenges in steel and battery segments. Positive elements include improved debt management and infrastructure profits. The Q&A reveals uncertainties in price negotiations and market demand, but potential growth in India and Southeast Asia. Despite cautious optimism and strategic initiatives, the lack of strong positive catalysts and ongoing challenges suggest a neutral stock price reaction over the next two weeks.
All transcripts are sourced directly from the official live webcast or the company’s official investor relations website. We use the exact words spoken during the call with no paraphrasing of the core discussion.
Full verbatim transcripts are typically published within 4–12 hours after the call ends. Same-day availability is guaranteed for all S&P 500 and most mid-cap companies.
No material content is ever changed or summarized in the “Full Transcript” section. We only correct obvious spoken typos (e.g., “um”, “ah”, repeated 10 times”, or clear misspoken ticker symbols) and add speaker names/titles for readability. Every substantive sentence remains 100% as spoken.
When audio quality is poor or multiple speakers talk over each other, we mark the section instead of guessing. This ensures complete accuracy rather than introducing potential errors.
They are generated by a specialized financial-language model trained exclusively on 15+ years of earnings transcripts. The model extracts financial figures, guidance, and tone with 97%+ accuracy and is regularly validated against human analysts. The full raw transcript always remains available for verification.
