POSCO, the nation’s top steelmaker, is likely to post a net loss in 2015, weighed by excessive supply by Chinese rivals and weak demand in the global steel market, according to industry sources Tuesday.
   The forecast is based on the combined performance of its affiliates, including POSCO Energy, Daewoo International and POSCO Engineering & Construction. Its core steelmaking business will continue to remain profitable, the sources added.

POSCO’s worst-ever performance in 2015 has been expected since the conglomerate said its combined annual net loss could reach up to 300 billion won ($248 million) last October. The steelmaker will announce the exact performance data for 2015 next week at its annual investor relations session, scheduled for Jan. 28.

Shares of POSCO declined Tuesday morning following a second straight day of gains, affected by the 2015 projections. But they rebounded, closing at 165,500 won, 0.3 percent up from the previous day.

Market watchers forecast the world’s fifth-largest steelmaker will further accelerate its business restructuring efforts to cope with worsening business conditions of the global steel industry this year.

“The falling demand in the Chinese market will deepen competition among global steel exporters, including POSCO,” said Kim Yoon-sang, a stock market analyst from LIG Investment & Securities.

To improve financial health amid deteriorating business conditions, POSCO has streamlined underperforming businesses while raising competency in its core steel business since the announcement of its “Innovation 2.0” plan last July.

  Under the plan, the conglomerate reorganized its businesses into four sectors: materials, energy, infrastructure and trading. In addition, it has pushed for a downsizing drive targeting money-losing businesses and affiliates at home and abroad.

By Seo Jee-yeon (jyseo@healdcorp.com)