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MarketScreener Homepage  >  Equities  >  Korea Stock Exchange  >  POSCO    A005490   KR7005490008

POSCO

(A005490)
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POSCO to revamp non-steel ops, shun major steel investment -new CEO

03/14/2014 | 01:10am EST
A plant of South Korea's steel maker, POSCO, is seen in Pohang

SEOUL (Reuters) - POSCO's (>> Woori Investment & Securities Co Ltd) new chief executive said the South Korean steelmaker will restructure non-steel businesses and not make any major investment in increasing steelmaking capacity, in a marked break from the strategy of his predecessor.

SEOUL (Reuters) - POSCO's (>> Woori Investment & Securities Co Ltd) new chief executive said the South Korean steelmaker will restructure non-steel businesses and not make any major investment in increasing steelmaking capacity, in a marked break from the strategy of his predecessor.

Incoming CEO Kwon Oh-joon, a former POSCO chief technology officer, will sell non-core assets and list affiliates after a wave of investment and acquisitions left the world's fifth-biggest steelmaker with high debt and credit-rating downgrades.

POSCO, once one of the industry's star performers, posted its third straight year of profit decline last year as it continued to grapple with steel oversupply and reduced customer demand brought about by recent global economic downturn.

"POSCO's biggest task is to improve its financial structure," Kwon said at a news briefing after starting a three-year term as chief executive and chairman. "First of all, we have to improve our core competitiveness in steel and generate profit."

To that end, POSCO will restructure its materials and energy businesses, and focus on lithium, nickel, fuel cells and clean coal, Kwon said.

POSCO will also seek mergers and acquisitions in non-steel businesses such as clean coal, and "take the bold step of shedding non-core" operations, he said at an annual meeting of shareholders before the briefing without specifying any units.

Subsidiary POSCO Specialty Steel in 2012 decided against listing $424 million of shares because of tepid investor demand.

Shares of POSCO were down 0.7 percent at 0515 GMT after the comments, similar to the 0.6 percent fall in the broader market

<.KS11>.

"Unlike his predecessor, chairman Kwon has taken a realistic and detailed approach. If he lives up to his promise, this will help improve POSCO's balance sheet," said Hi Investment & Securities analyst Bang Min-jin.

The steelmaker could sell such non-core assets as a department store owned by POSCO trading unit Daewoo International Corp (>> Daewoo International Corporation), said Bang.

POSCO, backed by billionaire U.S. investor Warren Buffett, in January said it would reduce investment by 14 percent this year as it does not see any revenue growth.

On Friday, Kwon said POSCO will continue trying to build steel mills in India after years of delays.

(Reporting by Hyunjoo Jin; Editing by Edwina Gibbs, Kenneth Maxwell and Christopher Cushing)


© Reuters 2014
Stocks mentioned in the article
ChangeLast1st jan.
ANHUI JIANGHUAI AUTOMOBILE GROUP CORP.,LTD. 0.39% 10.22 End-of-day quote.-16.43%
BERKSHIRE HATHAWAY INC. -0.70% 350320 Delayed Quote.1.43%
NH INVESTMENT & SECURITIES CO., LTD. -2.49% 11750 End-of-day quote.3.98%
POSCO -2.48% 275000 End-of-day quote.1.10%
POSCO INTERNATIONAL CORPORATION 0.33% 15250 End-of-day quote.4.81%
SEEK LIMITED -0.73% 27.1 End-of-day quote.-5.01%
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More news
Financials
Sales 2020 57 768 B 52,3 B 52,3 B
Net income 2020 1 382 B 1,25 B 1,25 B
Net Debt 2020 8 600 B 7,79 B 7,79 B
P/E ratio 2020 17,1x
Yield 2020 2,88%
Capitalization 21 571 B 19 563 M 19 543 M
EV / Sales 2020 374x
EV / Sales 2021 350x
Nbr of Employees -
Free-Float 88,3%
Chart POSCO
Duration : Period :
POSCO Technical Analysis Chart | A005490 | KR7005490008 | MarketScreener
Technical analysis trends POSCO
Short TermMid-TermLong Term
TrendsNeutralBullishBullish
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus BUY
Number of Analysts 28
Average target price 318 464,29 KRW
Last Close Price 275 000,00 KRW
Spread / Highest target 41,8%
Spread / Average Target 15,8%
Spread / Lowest Target -9,09%
EPS Revisions
Managers and Directors
NameTitle
Jeong-Woo Choi Co-Chief Executive Officer & Director
In-Hwa Chang Co-President, Co-CEO & Director
Seung-Kyu Lim Senior Managing Director & Head-Finance
Hag-Dong Kim Director & Senior Executive Vice President
Tak Jeong Director, Senior EVP & Head-Marketing
Sector and Competitors
1st jan.Capitalization (M$)
POSCO1.10%19 563
ARCELORMITTAL4.39%25 197
NUCOR4.29%16 748
NIPPON STEEL CORPORATION4.59%12 322
TATA STEEL LIMITED9.63%11 150
COMPANHIA SIDERÚRGICA NACIONAL S.A.7.88%9 034