By Kwanwoo Jun

Posco Holdings reported a net loss for the final quarter of 2024, missing market consensus, as lower prices of steel and energy materials weighed heavily on its profit margins.

The South Korean steelmaker said Monday that it faced weak demand at home and abroad. The oversupply of steel products from China, which has led to a global glut, also aggravated business conditions for the company struggling with the industry downturn.

Posco also recognized heavy asset-impairment and inventory-valuation losses after it suspended operations at some of its aged steel mills amid the industry downturn.

Its fourth-quarter net loss was 703.00 billion won, equivalent to $482.3 million, after three profitable quarters. That missed a FactSet-compiled consensus estimate for a profit.

Revenue was 17.805 trillion won for the quarter, with operating profit at 95.00 billion won. Both were significantly lower than the previous quarter.

The company's main steel business posted a net loss of 6.00 billion won, hit by lower steel prices and higher operating costs amid weakening sales.

For the full year, net profit nearly halved to 948.00 billion won and operating profit slumped 38% to 2.174 trillion won as revenue fell 5.8% to 72.688 trillion won.

Earlier Monday, Posco's battery-material affiliate, Posco Future M, reported its third straight quarterly net loss as revenue dropped 36% from a year earlier, weighing on the parent company's results.

Continuing sluggish demand for electric vehicles globally has pressured revenue and earnings growth at battery makers and battery-material suppliers.

Shares of Posco Holdings fell 4.6% Monday. The stock nearly halved in value last year after slumping 34% in the final quarter.

In response to tough business conditions, Posco has been streamlining some underperforming projects or selling off nonessential assets to secure extra funds for future growth. It said Monday that the restructuring brought in 665 billion won of extra cash in 2024 and could generate an additional 1.500 trillion won this year.

Write to Kwanwoo Jun at kwanwoo.jun@wsj.com

(END) Dow Jones Newswires

February 03, 2025 04:28 ET (09:28 GMT)

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