Posco Holdings Inc. · KRX:005490
Posco — Q2 2019 Earnings Presentation
21 slides from Posco's earnings presentation, Jul 24, 2019
Slide 1: 2Q 2019 Earnings Release
2Q 2019 Earnings Release July 23, 2019 Posco With POSCO
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 second quarter of 2019. As figures in this presentation are based on unaudited fin
Slide 3: Contents
Contents 2Q 2019 Business Performance 2019 Business Outlook Appendix With POSCO 2Q 2019 Earnings Release July 23, 2019
Slide 4: 2Q 2019 Business Performance
2Q 2019 Business Performance - Parent Performance - Consolidated Performance - Financial Soundness - Subsidiary Performance With POSCO 2Q 2019 Earnings Release July 23, 2019
Slide 5: Parent Performance: Production/Sales
5 Parent Performance_Production/Sales Production (thousand tons) Crude Steel Product 9,406 9,444 9,377 9,027 9,040 8,855 QoQ +38 -185 2Q18 1Q19 2Q19 Sales (thousand tons, %) Sales Volume Domestic Sales WTP Sales Ratio 8,960 9,283 8,746 QoQ -537 57.5 55.3 57.4 +2.1%p -0.1%p 29.6 29.7 29.6 2Q18 1Q19 2
Slide 6: Parent Performance: Financials
6 Parent Performance_Financials P/L (billion KRW, %) Revenue Operating Profit OP Margin 7,705 7,817 QoQ 7,476 -341 822 833 724 -109 10.7% 10.7% 9.7% -1.0%p 2Q18 1Q19 2Q19 Financial Structure QoQ 20.0% 17.4% 17.8% -2.2%p Liabilities Ratio Net Debt -2.24 +0.33 -3.12 (trillion KRW) -3.45 2Q18 1Q19 2Q19
Slide 7: Consolidated Performance
7 Consolidated Performance P/L 16,083 16,321 QoQ (billion KRW, %) 16,014 +307 Revenue 1,252 Operating Profit 1,203 1,069 -134 7.8% 7.5% OP Margin 6.5% -1.0%p 2Q18 1Q19 2Q19 Financial Structure QoQ 68.8% 67.7% Liabilities Ratio 65.0% -3.8%p 11.7 Net Debt 9.0 9.2 +0.2 (trillion KRW) 2Q18 1Q19 2Q19 Whi
Slide 8: Financial Soundness: Consolidated
8 Financial Soundness_Consolidated Continued to enhance financial soundness maintaining consolidated debt below 20 tril KRW and D/E at 2.6x Debt Gross Debt Net Debt 22.7 21.1 20.2 19.9 19.2 15.1 11.5 9.5 9.0 9.2 2016 2017 2018 1Q19 2Q19 Interest Coverage Ratio * Quarterly figures are annualized 12.1
Slide 9: Subsidiary Performance: Domestic
9 Subsidiary Performance_Domestic POSCO International · Earnings improved as Myanmar gas sales increased and performance of trading segment remained steady - Gas sales: (‘19.1Q) 51.3 (‘19.2Q) 53.9 billion ft3 Revenue Operating Profit (billion KRW) 5,688 5,736 6,075 113 159 178 2Q18 1Q19 2Q19 POSCO E
Slide 10: Subsidiary Performance: Overseas
10 Subsidiary_Overseas PT. Krakatau POSCO · While sales volume went up, operating profit slipped as raw material prices hiked - Sales volume(+29k tons) : (1Q) 742 (2Q) 771 446 Revenue 439 435 Operating Profit (million USD) 50 21 15 2Q18 1Q19 2Q19 POSCO Maharashtra · Revenue and OP improved on increa
Slide 11: 2019 Business Outlook
2019 Business Outlook With POSCO 2Q 2019 Earnings Release July 23, 2019
Slide 12: 2019 Business Outlook
12 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 With POSCO 2Q 2019 Earnings Release July 23, 2019
Slide 13: Appendix
Appendix Market & Outlook - Global Steel Demand - Domestic Steel Demand - Raw Materials Outlook Summarized F/S_Parent Summarized F/S_Consolidated With POSCO 2Q 2019 Earnings Release July 23, 2019
Slide 14: Global Steel Demand
14 Global Steel Demand Chinese Steel Market “Economic boost in China, strong raw material prices will sustain steel prices steady” Concerns exist over downward trend of economic growth rate (1Q) 6.4%(2Q) 6.2% - Automobile, machinery, and overall manufacturing industries show weak production level, w
Slide 15: Domestic Steel Demand
15 Domestic Steel Demand Demand Industry Automobile Despite consumption promoting measures, production recovery will be delayed with weak consumer sentiment and end of OEM manufacturing Auto Production (thousand cars) 1,129 957 1,071 898 2018.4Q 2019.1Q 2Q 3Q(f) Shipbuilding Shipbuilding volume will
Slide 16: Raw Materials Outlook
16 Raw Materials Outlook Iron Ore Strong demand from growth of steel production, coupled with supply disruption due to Vale’s dam accident in Brazil in January and cyclone in West Australia in March, resulted 2019.2Q in tight iron ore market. Non-market factors such as overheated Chinese futures mar
Slide 17: Summarized F/S: Parent Income Statement
17 Summarized F/S _Parent Income Statement 2Q 18 1Q 19 2Q 19 QoQ Crude Steel Production (thousand tons) 9,377 9,406 9,444 +38 Product Sales (thousand tons) 8,960 9,283 8,746 -537 STS 528 506 448 -58 Carbon Steel Sales Price (thousand KRW) 730 722 735 +13 (billion KRW) Revenue 7,705 7,817 7,476 -341
Slide 18: Summarized F/S: Parent Balance Sheet
18 Summarized F/S _Parent Balance Sheet (billion KRW) 2Q 18 1Q 19 2Q 19 QoQ Current Assets 15,652 17,603 17,599 -4 Cash Balance* 6,317 7,734 7,110 -624 Accounts Receivable 4,420 4,449 4,281 -168 Inventories 4,463 4,998 5,385 +387 Current Ratio(%) 383.4% 422.7% 566.7% +144.0%p Non-Current Assets 38,3
Slide 19: Summarized F/S: Consolidated Income Statement
19 Summarized F/S _Consolidated Income Statement (billion KRW) 2Q 18 1Q 19 2Q 19 QoQ Revenue 16,083 16,014 16,321 +307 Gross Profit 2,164 1,813 1,614 -199 (Gross Margin) (13.5%) (11.3%) (9.9%) (-1.4%p) SG&A 912 610 545 -65 Operating Profit 1,252 1,203 1,069 -134 (Operating Margin) (7.8%) (7.5%) (6.5
Slide 20: Summarized F/S: Consolidated Balance Sheet
20 Summarized F/S_Consolidated Balance Sheet (billion KRW) 2Q 18 1Q 19 2Q 19 QoQ Current Assets 33,348 34,678 34,046 -632 Cash Balance* 9,569 10,887 10,021 -866 Accounts Receivable 9,661 10,110 9,926 -184 Inventories 10,639 11,259 11,708 +449 Current Ratio(%) 167.2% 183.0% 192.7% +9.7%p Non-Current
Slide 21: Aggregated Earnings by Segment
21 Aggregated Earnings by Segment (billion KRW) Revenue Operating Profit Net Profit Segment 2Q18 1Q19 2Q19 2Q18 1Q19 2Q19 2Q18 1Q19 2Q19 Steel 12,724 12,556 12,509 1,024 893 805 668 635 520 Global&Infra* 12,416 12,156 12,876 272 293 300 9 177 147 Trading 9,507 9,371 9,950 140 180 206 -6 73 90 E & C