Posco Holdings Inc. · KRX:005490
Posco — Q3 2004 Earnings Presentation
23 slides from Posco's earnings presentation, Oct 13, 2004
Slide 1: 3Q 2004 Results
3Q 2004 Results October 2004 EXHIBIT 99.1 .
Slide 2: Table of Contents
Operating Results for 3Q 2004 Major Business Activities Business Environment for the Steel Industry Business Plan for 2004 Table of Contents
Slide 3: Basis of presentation and cautionary notes
The figures in this presentation are based on estimates made in view of prospects of business environment and unaudited financial statements of the company for the 3rd quarter of 2004, and have been presented solely for the convenience of investors Certain contents in this presentation are subject t
Slide 4: Table of Contents
Operating Results for 3Q 2004 Major Business Activities Business Environment for the Steel Industry - Global Steel Industry Outlook - China Steel Industry Outlook - Domestic Steel Industry Outlook Business Plan for 2004 Table of Contents
Slide 5: Highest Level of Production & Sales Volume due to Increased Demand
Highest Level of Production & Sales Volume due to Increased Domestic/International Demand Increased hot rolled steel production via opening of Mini Mill #2 (Sept 20) (Units: Thousand tons, %) Production / Sales * Based on accumulated 3Q figures 2004 1Q - 3Q YoY Change* 1Q 2Q 3Q 2004 1Q - 3Q YoY Chan
Slide 6: Sales Volume by Product
Sales Volume by Product 2004 1Q - 3Q YoY Change* 1Q 2Q 3Q 2004 1Q - 3Q YoY Change* Hot Rolled Steel 2,298 2,109 2,248 6,655 1.1% Plates 804 828 823 2,455 8.3% Wired Rod 508 487 503 1,448 2.5% Cold Rolled Steel 2,356 2,457 2,522 7,335 7.3% Electrical Steel 190 168 173 531 12.5% S T S 493 476 480 1,49
Slide 7: Summary of Profit / Loss Statement
Summary of Profit / Loss Statement 2004 1Q - 3Q YoY Change* 1Q 2Q 3Q 2004 1Q - 3Q YoY Change* Revenue Revenue 4,285 4,755 5,144 14,184 36% Cost of Goods Sold Cost of Goods Sold 3,027 3,350 3,607 9,984 33% Operating Profit Operating Profit 1,008 1,188 1,244 3,440 51% Operating Margin 23.5% 25.0% 24.2
Slide 8: Financial Position
Financial Position 2004 2004 2004 YoY Change* 1Q 2Q 3Q YoY Change* Total Assets Total Assets 18,566 19,256 19,673 10.6% Current Assets Fixed Assets 5,489 13,077 6,193 13,063 6,420 13,253 29.1% 3.4% Total Liabilities Total Liabilities 5,214 5,150 4,757 (10.0%) Borrowings In US$ Bn 3,210 1.6 2,992 1.5
Slide 9: Key Financial Ratios
Key Financial Ratios A 2001 589 2002 612 2003 760 3Q2004 972 A 2001 12.89 2002 15.63 2003 21.3 3Q2004 24.2 A 2001 57.9 2002 65.7 2003 70.4 3Q2004 75.8 A 2001 10043 2002 13442 2003 24306 3Q2004 39663 A 2001 12.1 2002 8.8 2003 6.7 3Q2004 4.3 A 2001 5.4 2002 4.5 2003 3.4 3Q2004 3.23 Sales Revenue per E
Slide 10: Table of Contents
Table of Contents Operating Results for 3Q 2004 Major Business Activities Business Environment for the Steel Industry - Global Steel Industry Outlook - China Steel Industry Outlook - Domestic Steel Industry Outlook Business Plan for 2004
Slide 11: Features of FINEX
Features of FINEX Direct use of cheaper raw materials (fine ore/coal) without sintering and coking plants Reduce pollutants (eg. SOx and NOx) Construction Period: Aug 2004 - Dec 2006 Capacity: 1.5 mm tons/yr Expected Implications: Commercialization of innovative iron making technology to increase pi
Slide 12: Strengthening Raw Material Procurement
South Africa Australia Canada Brazil Strengthening Raw Material Procurement Continue to Develop Overseas Mines to Stabilize Procurement of Raw Materials (Annual Procurement of 7 million tons) Maintain Competitiveness in Raw Material Transportation POSMAC Investment (Apr 2002) ? Ownership Interest: 2
Slide 13: Overseas Steel Investments
Strategy based on India's high growth potential and to utilize abundant resources Economic Growth Forecast: 6.9% (2004)^7.3% (2005)^7.0% (2006) Milestones: POSCO-BHPB joint proposal (Aug 2004) India Investment Plans Brazil Investment Plan Strategy to tap large resource countries with growth potentia
Slide 14: Selected Strategic Products
Selected 8 Strategic Products Premium automotive steel sheets, premium API steel, premium electrical steel sheets, STS 400 steel, premium high carbon steel, shipbuilding TMCP, steel for tire cord, and Cr- free galvanized steel Increase Investment for Strategic Products #5 CGL (July 04 - Oct 05), #6
Slide 15: Enhancing Shareholder Value
Size of Buy-back: 1,779,000 shares Buy-back Period: Jul 27 - Oct 26, 2004 Cancellation Scheduled for October 2004 Purchase and Cancellation of Treasury Stock Dividend Policy Enhancing Shareholder Value Annual Dividend Rate History History of Treasury Share Cancellation Interim Dividends Executed in
Slide 16: Transparent Corporate Governance Structure
Continuously Improved Global-Oriented Professional Management System since initial adoption in Mar 1999 Responsible management, outside director centered decision making and evaluation etc. BOD and Committees Centered Around Independent Outside directors (6 Standing and 9 Outside Directors) Transpar
Slide 17: Table of Contents
Table of Contents Operating Results for 3Q 2004 Major Business Activities Business Environment for the Steel Industry - Global Steel Industry Outlook - China Steel Industry Outlook - Domestic Steel Industry Outlook Business Plan for 2004
Slide 18: Global Steel Industry Outlook
Global Steel Industry Outlook Upward Trend for Steel Prices Prices Remain Robust Increase in Production Continued Upward Trend After Adjustment Major Producers Raising Price (Aug 04) Nucor: Flat products ($100) US Steel: HR ($110), CR ($35) Import Prices Continue to Rise HRC: $700 (Aug 04) ^ $675 (S
Slide 19: China Steel Industry Outlook
China Steel Industry Outlook (Shanghai Province) Source : CISA (Sept 04), POSCO China (Oct 04) Apr 03 Apr 04 May 20 Sept 29 HRC CRC ^ 480 ^ 389 499 ^ 490 ^ ^ 307 ^ 449 (MM tons) Outlook for China's Steel Market (Jan - Jul 2004) 22.9 17.7 -8.3 43.8 161.4 175.8 20.3 5.9 86.8 86.1 1.5 2.2 20.3 20.5 53.
Slide 20: Domestic Steel Industry Outlook
Steel Demand by Industry Domestic Steel Industry Outlook * Based on accumulated 3Q figures Steel Supply Forecast Large increase in import expected due to continued imbalance between upstream and downstream processes Automobile Construction Shipbuilding 1H 04 (YoY Change) 1.8% 4.8% 15.1% 2004 (F) YoY
Slide 21: Table of Contents
Table of Contents Operating Results for 3Q 2004 Major Business Activities Business Environment for the Steel Industry - Global Steel Industry Outlook - China Steel Industry Outlook - Domestic Steel Industry Outlook Business Plan for 2004
Slide 22: Business Plan for 2004
(mm tons, KRW Bn) 2003 2004 (F) 28.9 30.0 27.5 29.1 14,359 19,496 3,059 4,806 Production Sales of Finished Products Revenue Operating Profit The data above represent internal targets for the company and should not be relied on when making investment decisions Business Plan for 2004 Steel Production
Slide 23: Thank You
Thank You