Seoul: Hyundai Steel Co., South Korea's second-largest steelmaker, announced a return to profitability in the third quarter, driven by increased sales of high-end products. This marks a significant turnaround from the previous year's losses.
According to Yonhap News Agency, Hyundai Steel achieved a net profit of 17.8 billion won (US$12.5 million) in the three months ending in September. This contrasts with a net loss of 16.2 billion won during the same period last year, as revealed in a regulatory filing by the company.
A company official attributed the positive financial performance to decreased raw materials costs and increased sales of value-added products, particularly automotive steel. Hyundai Steel supplies over 80 percent of its 5 million tons of annual automotive steel output to Hyundai Motor Co. and Kia Corp.
Looking ahead, the company anticipates further earnings improvements in the fourth quarter. This expectation is bolstered by a reduction in low-priced Chinese steel imports and government stimulus measures aimed at boosting the domestic economy.
The company's operating profit saw a significant increase of 81 percent, reaching 93.2 billion won compared to 51.5 billion won a year prior. Sales also experienced a slight rise of 2 percent, totaling 5.73 trillion won from 5.62 trillion won.
Despite the third quarter success, Hyundai Steel reported a steep decline in net income for the first nine months of the year, with a plunge of 95.4 percent to 800 million won from 17.4 billion won in the same period last year. The company official noted that a prolonged downturn in the construction industry negatively impacted net results during this timeframe.