Posco Holdings’ Q3 operating profit plunges 71% over typhoon damage, dropped steel price

Posco Holdings said Monday that its third quarter operating profit plunged 71 percent to 920 billion won ($363.9 million), largely due to operation suspension and damages from typhoon that hit the company’s steel plant in Pohang, North Gyeongsang Province, last month, as well as the continuously falling global price of steel.

The holding company of the steelmaker Posco said in its regulatory filing that its third quarter net profit dropped sharply to 592 billion won, a 77.2 percent fall on-year. Its sales from July to September inched up 2.9 percent to 21.1 trillion won.

According to Posco Holdings, it saw a total of 435.5 billion won in losses due to the typhoon that hit Pohang on Sept. 6. Posco saw 222.1 billion won in losses just from shutting down facilities at Pohang plant, which had stopped for the first time in 49 years. It also saw another 186 billion won in losses for having to scrap inventory such as raw materials for steel and already produced steel products that were damaged due to rain and sea water.

The company said it would resume operation of its entire steel production at Pohang facilities within this year. Currently, part of the production volume at Pohang plant have been transferred to another steel plant located in Gwangyang, South Jeolla Province.

Global steel prices have continued to fall, between 16 percent and 27 percent over the past four months.