On October 26, POSCO held an IR session and announced a revenue of KRW 12.748 trillion, as well as an operating profit of KRW 1.034 trillion in the third quarter. Its net income amounted to KRW 475.5 billion.

As the number of its subsidiaries was reduced due to group restructuring, revenue on a consolidated basis declined by 0.9% QoQ. However, thanks to the slight improvement in the performance of the energy and ICT divisions due to the vastly improved performance of the steelmaking division, operating profit and net income increased by 52.4% and 115.6% QoQ respectively.

In particular, due to the increased sale of high value-added products and a reduction in costs, the operating profit of overseas steelmaking subsidiaries increased by 1148% QoQ to KRW 132.3 billion. The integrated steel mill in Indonesia also recorded an operating profit of KRW 38.5 billion. In addition, major overseas steelmaking subsidiaries, including the Mexico CGL, the cold rolling mill in Vietnam and the cold rolling mill and CGL in Maharashtra, India, saw their operating profits greatly increase.

The separate revenue and operating profit of POSCO increased by 1.6% and 19.6% QoQ respectively to KRW 6.106 trillion and KRW 852.4 billion. Its net income amounted to KRW 579 billion, up 86.5% QoQ.

The separate operating profit margin went up by 2.1% QoQ to 14% thanks to the increased sales of WP (World Premium) products and solutions, the higher price of steel and cost-saving efforts. It is the highest figure in 20 quarters since the third quarter of 2011.

The sales of WP products increased by 199,000 tons QoQ to 4,038,000 tons, a record high. As a result, WP products now account for 48.1% of the total sales of POSCO.

Its financial strength drastically improved as well. The consolidated debt-to-equity ratio was lowered by 5.5% QoQ to 70.4%, the lowest level since the introduction of the Consolidated Accounting Standards, and the separate debt-to-equity ratio declined by 2.3% QoQ to 16.9%, the lowest level since its founding. The debt on a consolidated basis decreased from the previous quarter to KRW 2.264 trillion, and on a separate basis, as it has more cash than loans, the net debt became negative (△KRW 829.5 billion).

Meanwhile, POSCO decided to merge POSCO TMC and SPFC into POSCO P&S in the third quarter, and slimmed down the structure of its steel distribution business. It also merged its processing centers in China and Japan to innovate the structure of its overseas steel business. All in all, POSCO completed nine cases of affiliate restructuring and eight cases of asset restructuring. POSCO is planning to finalize 24 cases of affiliate and asset restructuring in the fourth quarter of 2016, and 27 cases next year.

POSCO to Post 678.5 billion Won in Operating Profit on a Consolidated Basis During the Second Quarter

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Today, POSCO global blog will try to explain the basics of electric vehicles.

Pictured here: POSCO exhibit set up at The 1^st International Electric Vehicle Expo held in Jeju

What is an Electric Vehicle?

An electric car is basically an automobile that is powered by electricity. It is powered by an electric motor that runs on a rechargeable battery as opposed to a gasoline engine. Electric vehicles has gained widespread recognition predominantly because it is the environmentally-friendly alternative to gas guzzling automobiles.

Why should you care about Electric Vehicles?

Pictured here: EV on display that promotes ‘zero emissions’

 You might have heard the word ‘electric car’ lately, but might not understand what the direct benefits are. The major reasons that electric cars is top-of-mind for the auto industry and society as whole are for the following reasons:

1)      Less pollution: Electric cars are an eco-friendly alternative to gasoline powered cars as they create less pollution

2)      Cost effective in the long-run: Electric cars run on electricity so you can save up on annual car fuel costs and expensive maintenance related to oil changes, fuel filters, etc.

3)      Reduces fuel dependency: Electric vehicles can be powered by electricity produced from multiple energy sources including wind, solar, hydro, nuclear, biofuel, and fossil fuel sources. Therefore, electric vehicles have the potential to support economies while also reducing dependence on imported oil.

4)      Better Sound Quality: Electric cars may be difficult to differentiate from regular cars from the outside, but electric motors provide quiet and very smooth operation.

Challenges for Electric Vehicles

That is not to say that electric vehicles face no challenges. Driving range is a concern for consumers as gasoline vehicles can go longer distances. Recharge time and overall bulk are concerns also. Companies, including POSCO, are continuously investing time and energy to improve technologies and materials for electric vehicles.

Pictured here: Entrance to 1^st International Electric Vehicle Expo in Jeju

During March 15 through 21, the 1^st International Electric Vehicle Expo was held in Jeju Island, south of the Korean peninsula. More than 40 companies attended the event and consumers were able to see firsthand electric cars including Kia’s Ray EV, Reno Samsung SM3 Z.E., Chevrolet Spark EV, Kia Soul EV and BMW i3. Nearly 50,000 visitors came to the expo where POSCO Group showcased its innovative electric car technology.

Pictured here: POSCO exhibit at 1^st International Electric Vehicle Expo in Jeju

Of the participating companies, POSCO was the only company to offer a total solution that addresses materials, rechargeable infra and service. POSCO was the first steelmaking company to develop a body for an electric vehicle concept, solidifying its position at the forefront of electric vehicles.

POSCO Group’s <Total Solution>

Pictured here: POSCO executives gathered at the Expo in Jeju

POSCO Group companies including POSCO ICT, POSCO ChemTech, POSCO TMC and POSCO ESM were all present for the expo. As the first steelmaker to create the concept body for electric vehicles, POSCO proved that its steel solutions continue to provide value for the future of electric vehicles. The exhibit was divided into three parts consisting of rechargeable infra needed by electric vehicles, service and materials.

POSCO ICT’s electric vehicle rechargeable infra solution can be applied to all types of vehicles. Moreover, users are able to recharge without having to carry an external cable.

Pictured here: Chevrolet electric vehicle on exhibit being recharged

In addition, in order to improve the user experience, POSCO is offering a variety of convenient services. POSCO ICT has set up charging infrastructure around Jeju so travelers do not need to worry about lack of electricity. Beginning this June, POSCO ICT will form a partnership with E-Mart·BMW to offer easier charging services anytime, anywhere. POSCO ICT will also be forming a partnership with Seoul car sharing services to provide rechargeable infra.

POSCO also highlighted its commitment towards Nd magnets. Nd magnet, which is made of a rare earth metal, is an integral part of electric vehicle motors. They are currently imported from Japan and China. The Nd magnets that POSCO supplies can be applied to domestic electric vehicles and can reduce the dependency on imports.

State-of-the-Art Technology for Future Electric Vehicles

Pictured here: Compact-sized electric vehicle

Compared to internal combustion engines, electric vehicles are still trailing behind in terms of mileage and battery weight. Therefore a variety of new technologies are being applied for lightweight car bodies. For this reason, new materials beyond the previous aluminum and steel are being introduced into the development of electric vehicles.

POSCO is the first steelmaker to develop steel that is optimized for electric vehicle bodies. PBC-EV (POSCO Body Concept-Electric Vehicle) is the car body that was developed to showcase the state-of-the-art technology POSCO has recently developed for future electric vehicles.

PBC-EV has set the standard for EV steel solutions. It is made from cutting-edge steel and the latest components technology for an integrated solution that has reduced weight of 26.4% compared to previous car bodies.

Pictured here: Regular-sized electric vehicle made by Renault Samsung Motors

The Future of Electric Vehicles

As companies continue to improve and build upon existing electric vehicle technologies, the growing prominence of electric vehicles is highly probable. As an environmentally-conscious company, POSCO hopes to see more growth in this field. Would you buy an electric vehicle?