Posco Holdings Inc. · KRX:005490
Posco — Q3 2019 Earnings Presentation
18 slides from Posco's earnings presentation, Oct 24, 2019
Slide 1: 3Q 2019 Earnings Release
3Q 2019 Earnings Release October 24, 2019
Slide 2: Disclaimer
Disclaimer This presentation was prepared and circulated to release the informations regarding the company’s business performance to shareholders and investors prior to the completion of auditing for the period of the third quarter of 2019. As figures in this presentation are based on unaudited fina
Slide 3: Contents
Contents 3Q 2019 Business Performance—Parent Performance—Consolidated Performance—Subsidiary Performance 3Q 2019 Earnings Release â”, October 24, 2019
Slide 4: Parent Performance_Production/Sales
Parent Performance_Production/Sales Production Sales (thousand tons) 9,565 QoQ (thousand tons, %) QoQ 9,554 9,444 8,983 8,952 +206 +110 8,746 Crude Steel Sales Volume 9,096 +183 9,038 57.4 8,855 55.3 55.6 Product Domestic Sales -1.8%p WTP +0.3%p Sales Ratio 29.9 29.3 29.6 3Q18 2Q19 3Q19 3Q18 2Q19 3Q
Slide 5: Parent Performance_Financials
Parent Performance_Financials P/L Financial Structure QoQ QoQ 7,906 7,736 19.9% 19.5% Revenue 7,476 +260 Liabilities 17.8% +1.7%p Ratio 1,095 Operating 724 663 Profit -61 (billion KRW) 13.8% 9.7% Net Debt -3.12 -3.01 +0.11 8.6% -1.1%p (trillion KRW) -3.45 OP Margin % 3Q18 2Q19 3Q19 3Q18 2Q19 3Q19 â—
Slide 6: Consolidated Performance
Consolidated Performance P/L Financial Structure 16,411 QoQ QoQ 16,321 69.2% 15,988 -333 Revenue Liabilities Ratio 65.0% 65.7% +0.7%p 1,531 Operating 1,069 1,040 -29 Profit (billion KRW) 10.3 9.3% 6.5% 6.5% Net Debt 9.2 9.1 -0.1 (—) OP Margin % (trillion KRW) 3Q18 2Q19 3Q19 3Q18 2Q19 3Q19 â—‹ Overco
Slide 7: Subsidiary Performance_Domestic
Subsidiary Performance_Domestic POSCO International POSCO E&C · Revenue and operating profit weakened as trading business · Operating profit improved on accelerated progress rate slowed although Myanmar gas sales continued to be strong of plant constructions 3—Panama LNG Terminal +7.4 billion KRW, e
Slide 8: Subsidiary Performance_Overseas
Subsidiary Performance_Overseas PT. Krakatau POSCO Zhangjiagang STS (PZSS) · Earnings dropped with sales volume down from blast furnace · Profitability improved on expanded sales of WTP products maintenance and weaker sales price from slow demand and reduced costs—Sales Volume(-58k tons) : (2Q) 771
Slide 9: Appendix
Appendix Market & Outlook—Global Steel Demand—Domestic Steel Demand—Raw Materials Outlook Summarized F/S_Parent Summarized F/S_Consolidated 2019 Business Outlook 3Q 2019 Earnings Release”, October 24, 2019
Slide 10: Global Steel Demand
Global Steel Demand Chinese Steel Market Demand by Region “Steel market slows as manufacturing sector “Global steel demand modestly grows in 2019 continued to dip due to US-China dispute” supported by sound Chinese steel demand” As GDP growth rate* is continuously lowered, concerns over an  In
Slide 11: Domestic Steel Demand
Domestic Steel Demand Demand Industry Automobile Shipbuilding Construction  In 2019, government stimulus was not sufficient Shipbuilding volume in 2019 shows an upward  Although private sector remains slow in 2019, to fully recover depressed auto market and the trend y-o-y with increased or
Slide 12: Raw Materials Outlook
Raw Materials Outlook Iron Ore Coking Coal While iron ore price exceeded U$126/ton temporarily in July 3Q average price recorded U$161/ton as price dropped due to the supply disruption in major producing countries in sharply from shrinking demand on the back of Chinese 1H, it declined to U$80/ton in
Slide 13: Summarized F/S_Parent Income Statement
Summarized F/S_Parent Income Statement 3Q 18 2Q 19 3Q 19 QoQ Crude Steel Production (thousand tons) 9,565 9,444 9,554 +110 Product Sales (thousand tons) 8,983 8,746 8,952 +206 STS 518 448 533 +85 Carbon Steel Sales Price (thousand KRW) 747 735 734 -1 (billion KRW) Revenue 7,906 7,476 7,736 +260 Cost
Slide 14: Summarized F/S_Parent Balance Sheet
Summarized F/S_Parent Balance Sheet (billion KRW) 3Q 18 2Q 19 3Q 19 QoQ Current Assets 17,882 17,600 17,677 +77 Cash Balance* 8,502 7,110 7,850 +740 Accounts Receivable 4,485 4,281 4,046 -235 Inventories 4,534 5,385 5,246 -139 Current Ratio 413.5% 566.7% 634.6% +67.9%p Non-Current Assets 38,246 37,0
Slide 15: Summarized F/S_Consolidated Income Statement
Summarized F/S_Consolidated Income Statement (billion KRW) 3Q 18 2Q 19 3Q 19 QoQ Revenue 16,411 16,321 15,988 -333 Gross Profit 2,390 1,614 1,613 -1 (Gross Margin) (14.6%) (9.9%) (10.1%) (+0.2%p) SG&A 859 545 573 +28 Operating Profit 1,531 1,069 1,040 -29 (Operating Margin) (9.3%) (6.5%) (6.5%) (—)
Slide 16: Summarized F/S_Consolidated Balance Sheet
Summarized F/S_Consolidated Balance Sheet (billion KRW) 3Q 18 2Q 19 3Q 19 QoQ Current Assets 35,395 34,058 34,827 +769 Cash Balance* 11,723 10,021 10,709 +688 Accounts Receivable 9,829 9,939 9,714 -225 Inventories 10,911 11,708 11,770 +62 Current Ratio 175.5% 192.6% 205.5% +12.9%p Non-Current Assets
Slide 17: Aggregated Earnings by Segment
Aggregated Earnings by Segment (billion KRW) Revenue Operating Profit Net Profit Segment 3Q18 2Q19 3Q19 3Q18 2Q19 3Q19 3Q18 2Q19 3Q19 Steel 12,992 12,509 12,725 1,295 805 710 957 520 395 Global&Infra 13,004 12,876 12,067 255 299 322 100 147 288 Trading 10,021 9,950 9,072 88 206 161 36 90 0.1 E & C 1
Slide 18: 2019 Business Outlook
2019 Business Outlook Parent Consolidated (trillion KRW) 31.1 Revenue 66.8 Crude Steel Production 37.7 million tons Product Sales 36.2 million tons 5.4 Capex 6.1 Reserve 1.4 Reserve 1.6 4.7 Debt 20.0 ? Based on projections made in June 2019 3Q 2019 Earnings Release â”, October 24, 2019 3Q 2019 Earni