South Korean steelmaker Posco and its affiliates posted an operating profit of 666.7 billion won ($588.6 million) in the third quarter, down 35.9 percent from the same time a year earlier. The total revenue reached 14.26 trillion won in the same period, down 10.8 percent on-year, and the net profit stood at 514 billion won, up 3.5 percent, the company said.

While the quarterly performance stands short of the year before, the operating profit still jumped 297.5 percent on-quarter.

Looking at Posco’s independent score, the company said it posted 6.57 trillion won in revenue, with an operating profit of 261.9 billion won and a net profit of 180.8 billion won in the third quarter. When compared to the same quarter last year, revenue decreased by 15 percent, operating profit decreased by 60.5 percent and net profit dropped by 63.8 percent.

Affected by the COVID-19 pandemic, Posco independently recorded its very first operating loss of 108.5 billion won in the second quarter this year.

For the improved profitability in the third quarter, Posco explained that its production volume and sales recovered to the time before the COVID-19 pandemic, and it was able to reduce fixed costs. The company also said that while the price of iron ore rose, coal prices dropped, and the company made efforts to reduce other costs.

The company said it has resumed operation of the Gwangyang steel mill, the No. 3 blast furnace, and the level of orders placed recovered to increase by about 1.7 million tons and 1.05 million tons compared to the first and second quarters, respectively.

Sales volume in the third quarter was 8.89 million tons, up 1.13 million tons from the previous quarter, as demand for steel grew largely in the automobile industry, the company said.

In the global infrastructure sector, affiliates Posco Engineering and Construction, Posco Energy and Posco Chemical showed good performances, the company added.

For the fourth quarter, Posco said it anticipates profitability to improve, as companies across the globe are resuming operations and governments are making efforts to boost their respective economies.

In addition, the company said it will strengthen its sales portfolio to meet demand in environmentally friendly industries such as electric vehicles, plug-in hybrids and wind and solar energy equipment.

By Jo He-rim (herim@heraldcorp.com)