Slide 1: 2016 1Q Earnings Release
April 21, 2016 2016 1Q 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.
Slide 2: 1Q Operating Performance
1Q 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: 1Q Operating Performance: Parent Income
POSCO Earnings Release ｜April 21, 2016 6,788 5,945 5,767 Revenue Operating profit increased due to price hike and cost reduction 2015.1Q 2015.4Q 2016.1Q (thousand tons) (thousand KRW/ton, billion KRW, thousand tons) 9,183 9,756 9,064 Crude Steel 670 540 551 Carbon Steel Price (billion KRW) OP Margin
Slide 4: Consolidated Revenue, Operating Profit and Financial Structure
POSCO Earnings Release ｜April 21, 2016 Revenue/Operating Profit Net Income/ROE Financial Structure 13,906 335 4.8% 2.4% 15,101 110 (billion KRW) (billion KRW) (billion KRW) 12,461 353 5.3% 3.3% 1.0% ROE* Operating profit recorded 660 billion KRW as performance improved from steel, trading and other
Slide 5: Major Business Activities
1Q Operating Performance Major Business Activities 2016 Business Plan ▶
Slide 6: Strengthen Steel Competitiveness: World Premium Products
Strengthen Steel Competitiveness POSCO Earnings Release ｜April 21, 2016 Expanded World Premium product sales through providing customized solutions 【Automobile】 【Energy/Shipbuilding】 (thousand tons) ’15.1Q ’16.1Q WP Product sales volume ’15.4Q Lock-in Customers Provide Total Solution Expand M/S with
Slide 7: Strengthen Steel Competitiveness: Overseas Steel Subsidiaries
POSCO Earnings Release ｜April 21, 2016 Reduced the losses of overseas steel subsidiaries, such as upturn in Zhangjiagang STS mill Strengthen Steel Competitiveness ($/t, billion KRW) Shanghai HR Price* East Asian Slab import price** * Source : SBB, HRC (Q235 5.5mm) / China domestic Shanghai (incl. 17
Slide 8: Speed-up Restructuring
Speed-up Restructuring POSCO Earnings Release ｜April 21, 2016 Continued restructuring efforts and re-established group business portfolio Energy Materials Solution Trading Steel Smart Infra. Power Solution (IPP) Re-aligned business portfolio as “Steel”+“4 Domains” - Target to achieve distinctive com
Slide 9: Major Business Activities: Subsidiaries
주요 경영활동 POSCO Earnings Release ｜April 21, 2016 * X-AHSS: Extra Advanced High Strength Steel, NO: Non-Oriented magnetic steel POSCO Earnings Release ｜April 21, 2016 Major Subsidiaries Discovered additional offshore gas in Myanmar Completed exploration drilling on AD-7 block (Feb ’16) - Plan to evalua
Slide 10: 2016 Business Plan
1Q Operating Performance Major Business Activities 2016 Business Plan ▶
Slide 11: Business Plan
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 R
Slide 12: Appendix
Appendix 1. Business Environment – Steel demand and raw materials 2. Financial Statements ▶
Slide 13: Market Environment: Domestic Demand Outlook
Market Environment Domestic Demand Outlook POSCO Earnings Release ｜April 21, 2016 Domestic Demand & Supply Outlook (million tons) * POSRI(Apr 2016) 2013 2014 2015 2016(f) 1Q 2Q YoY Nominal Consumption 51.8 55.5 55.8 55.8 13.2 14.6 + 1.4% Export 29.2 32.3 31.6 32.3 7.6 8.3 + 6.3% Production 69.1 74.1
Slide 14: Market Environment: China's Steel Economy
43.0 48.2 41.0 42.2 40.6 46.7 49.0 49.7 478 406 365 335 296 306 309 369 407 '15.1 4 7 10 12 '16.1 2 3 4 POSCO Earnings Release ｜April 21, 2016 Market Environment China’s Steel Economy Steel Demand in Major Countries “2016 steel price and economic sentiment are showing earlier-than-expected recovery”
Slide 15: Iron Ore and Coking Coal Prices
POSCO Earnings Release ｜April 21, 2016 Iron Ore Coking Coal 2016.1Q 2016.2Q (US$/ton) *Platts 62% Fe IODEX CFR China (Quarterly Spot Average) 2014 2Q 2014 3Q 2014 4Q 2015 1Q 2015 2Q 2015 3Q 2015 4Q 2016 1Q 1Q average price slightly increased due to strong price in March, as iron ore price temporary
Slide 16: Summarized Statements of Income
2015.1Q 2015.4Q 2016.1Q QoQ Revenue 15,101 13,906 12,461 △1,445 Gross Profit 1,798 1,446 1,541 +95 (Gross Margin) (11.9%) (10.4%) (12.4%) - SG&A 1,066 1,105 882 △223 Operating Profit 731 341 660 +319 (Operating Margin) (4.8%) (2.4%) (5.3%) - Other Operating Profit 58 △315 2 +317 Share of Profit (los
Slide 17: Consolidated Statements of Financial Position
2015.1Q 2015.4Q 2016.1Q QoQ Current Assets 31,948 29,181 28,590 △591 Cash Balance* 6,491 8,686 8,514 △172 Account Receivable 11,653 9,596 9,346 △250 Inventories 10,046 8,225 7,787 △438 Non-Current Assets 52,683 512,279 508,650 △3,629 Other Long-term Financial Assets** 3,514 3,205 3,158 △47 PP&E 35,2