Slide 1: 2Q 2016 Earnings Release
July 21, 2016 2Q 2016 Earnings Release Figures in this presentation are based on unaudited financial statements of the company. Certain contents in this presentation are subject to change during the course of auditing process. Exhibit 99.1
Slide 2: 2Q Operating Performance
2Q Operating Performance Major Business Activities 2016 Business Plan ▶ Figures in this presentation are based on unaudited financial statements of the company. Certain contents in this presentation are subject to change during the course of auditing process.
Slide 3: 2Q Operating Performance: Parent
POSCO Earnings Release ｜July 21, 2016 6,576 5,767 6,010 Operating profit went up by 1.8%pt as product price and sales volume increased 2015.2Q 2016.1Q 2016.2Q 9,316 9,064 9,007 620 551 557* 9.2% 10.1% 11.9% 608 582 713 8,930 8,770 8,861 2015.2Q 2016.1Q 2016.2Q 2015.2Q 2016.1Q 2016.2Q 446 311* 210 20
Slide 4: 2Q Operating Performance: Consolidated
POSCO Earnings Release ｜July 21, 2016 4.5% 5.3% (billion KRW) 5.3% 2.0% 3.1% ROE* Operating profit improved as steel sectors gained, while non-steel sector remained weak 2015.2Q 2016.1Q 2016.2Q 2015.2Q 2016.1Q 2016.2Q 2.5% 2015.2Q 2016.1Q 2016.2Q 86.9% 77.0% 75.9% Net Income (billion KRW) Revenue Op
Slide 5: Operating Performance of Major Non-steel Subsidiaries
POSCO Earnings Release ｜July 21, 2016 ※ Operating Performance of Major Non-steel Subsidiaries POSCO-Daewoo POSCO E&C POSCO Chemtech POSCO ICT POSCO Energy Revenue of non-steel sectors (2Q16) Sales volume dropped due to maintenance of Myanmar gasfield. Remaining sales will be made in 2H16 80 105 81 2
Slide 6: Operating Performance of Major Overseas Steel Subsidiaries
Overseas steel subsidiaries turned profit, as performance of mills, including 3 upstream plants, improved POSCO Earnings Release ｜July 21, 2016 ※ Operating Performance of Major Overseas Steel Subsidiaries 2Q Operating Performance ’16.1Q 2Q 11 ’15.2Q Thainox POSCO Maharashtra POSCO Mexico PT Krakatau
Slide 7: Major Business Activities
2Q Operating Performance Major Business Activities 2016 Business Plan ▶
Slide 8: Built up value chain to expand production and sales of WP products
Built up value chain to expand production and sales of WP* products POSCO Earnings Release ｜July 21, 2016 Upstream Downstream Processing Center Solution Marketing Gwangyang No.5 BF revamping Rationalization of Gwangyang No.4 CR Built new rolling mill Enhanced efficiency by integrating operations App
Slide 9: Expanded market share for automotive steel
POSCO Earnings Release ｜July 21, 2016 Expanded domestic/overseas market share for automotive steel, through reinforcing production and sales network Added production/sales network base in major growth regions - Thailand CGL started operation (450k tons, Jun) - Completed construction of 3 processing
Slide 10: Restructuring of subsidiaries
POSCO Earnings Release ｜July 21, 2016 81 out of 149 target of restructuring completed (’14~’16.1H) Steel (10) E&C (11) Chemicals and others (24) Accumulated cases by division 1H16 Results POSCO AST, merged with POSCO P&S (Jul ‘16) Sold Qingdao Pos-metal Co. ltd (Jun ‘16) Liquidated POSCO-Russia Mapo
Slide 11: 2016 Business Plan
2Q Operating Performance Major Business Activities 2016 Business Plan ▶
Slide 12: Business Plan
2015 2016(f) POSCO Revenue (trillion KRW) 25.6 24.3 - Crude steel production (million tons) 38.0 37.2 - Product sales (〃) 35.3 35.3 CAPEX (trillion KRW) 2.0 2.1 Net Debt (〃) 0.4 △0.6 Consolidated Revenue (trillion KRW) 58.2 58.7 CAPEX (〃) 2.5 2.8 Net Debt (〃) 16.5 14.6 POSCO Earnings Release ｜July 2
Slide 13: Appendix
Appendix 1. Business Environment – Steel demand and raw materials 2. Financial Statements ▶
Slide 14: Business Environment: Domestic Demand Outlook
2013 2014 2015 2016(f) 1Q 2Q 3Q YoY Nominal Consumption 51.8 55.5 55.8 56.4 13.5 14.9 14.1 + 0.1% Export 29.2 32.3 31.6 31.3 7.6 7.4 8.1 + 3.6% Production 69.1 74.1 74.1 74.4 17.9 18.6 18.8 + 2.3% Import 11.8 13.7 13.2 13.4 3.3 3.7 3.4 △ 3.7% Incl. Semi-Product 19.4 22.7 22.1 22.6 5.7 6.1 5.6 △ 2.4%
Slide 15: Global steel demand and supply outlook
“Steel price to stabilize while supply-demand situation tightens due to supply reduction” “Downtrend of China’s demand eased and the demand of emerging countries to see upside” Previously expected demand downturn from China (△4.0%) is to be eased as auto production picked up and economic stimulus pl
Slide 16: Iron ore and coal prices
2016.2Q 2016.3Q (US$/ton) * 62% Fe IODEX CFR China (Quarterly Spot Average) 2014 3Q 2014 4Q 2015 1Q 2015 2Q 2015 3Q 2015 4Q 2016 1Q Iron ore price increased from 1Q, as steelmakers pushed for more production in preparation for shut-down scheduled for Gardening exhibition in Tangshan area Price is to
Slide 17: Summarized Statements of Income
2015.2Q 2016.1Q 2016.2Q QoQ Revenue 15,190 12,461 12,857 396 Gross Profit 1,721 1,541 1,569 28 (Gross Margin) (11.3%) (12.4%) (12.2%) - SG&A 1,035 882 891 9 Operating Profit 686 660 679 19 (Operating Margin) (4.5%) (5.3%) (5.3%) - Other Operating Profit △148 △12 △13 △1 Share of Profit (loss) of Equi
Slide 18: Consolidated Statements of Financial Position
2015.2Q 2016.1Q 2016.2Q QoQ Current Assets 31,450 28,590 28,736 146 Cash Balance* 7,319 8,514 8,405 △109 Account Receivable 11,115 9,346 9,352 6 Inventories 9,344 7,787 7,748 △39 Non-Current Assets 52,187 50,864 50,660 △204 Other Long-term Financial Assets** 3,355 3,157 3,096 △61 PP&E 34,924 34,189