Seoul: Hyundai Steel Co., South Korea's second-biggest steelmaker, announced a significant financial turnaround, reporting a net profit in the fourth quarter, driven by equity gains from its affiliates. The company revealed that it achieved a net profit of 105.8 billion won (US$73.7 million) for the three months ending December 31, a stark contrast to the net loss of 197.5 billion won recorded in the same period the previous year.
According to Yonhap News Agency, the improved financial performance was largely attributed to increased shareholding gains from Hyundai Steel's affiliate, Hyundai Steelpipe, as well as from its overseas steel service centers (SSCs). These SSCs are instrumental in processing steel products for key clients like Hyundai Motor Co. and Kia Corp., who have operational plants in major markets such as the United States.
In addition to the net profit, Hyundai Steel also reported an operating profit of 109 billion won for the December quarter, reversing an operating loss of 229.1 billion won from the previous year. However, the company's sales experienced a decline, falling 8.1 percent to 5.61 trillion won from 6.1 trillion won during the same timeframe.
Despite the positive quarterly results, Hyundai Steel's annual performance in 2024 reflected significant challenges. The net income for the year plummeted by 72.2 percent to 123.2 billion won from 443 billion won in the previous year. The operating profit also saw a sharp decline of 60.6 percent to 314.4 billion won from 798.3 billion won in 2023, with sales decreasing by 10.4 percent on-year to 23.22 trillion won.
The company spokesperson attributed the annual downturn to a combination of low product prices and high raw material costs. Additionally, increased imports of low-priced steel products and a prolonged downcycle in the construction industry adversely impacted sales over the year.