Though it still faces a rough period ahead until the year’s end, the nation’s top steelmaker POSCO rebounded during the second quarter, boosted by cost reduction in the steel sector and profit growth in the non-steel sectors.

The company recorded 15.6 trillion won ($14 billion) in sales, 903 billion won in operating profits, and 703 billion won in net profits during the second quarter of this year, it said through an investor relations conference on Thursday.

In terms of operating profit, this was 25.9 percent up from the previous quarter but 35 percent down from the same period last year.

The steelmaking headquarters of POSCO alone yielded 7.78 trillion won in sales and 703 billion won in operating profits.

Despite the weakness of the yen and sluggish price in the Chinese market, POSCO boosted its sales in China and Southeast Asia in the first half by 14.3 percent to 1.55 million tons and by 12.3 percent to 1.85 million tons respectively, officials said.

The positive performance was largely attributable to product price markup and a drop in raw material prices, according to observers.

The international market price of iron ore recently took a dive from $140 per ton in April to $120 in late June. POSCO, on the other hand, is expected to increase the unit price of its hot-rolled steel sheets within the year.

“As the top-selling Gwangyang furnace successfully kicked off operations in June, we expect additional cost reductions of up to 100 billion won,” said a company official.

POSCO also predicted that global steel demand would rise by 3 percent in the latter half of the year, thanks to investment growth in the Southeast Asian region.

The world’s top steel consumer, China, is also expected to hit a low in the third quarter and recover demand gradually by the year-end, officials said.

POSCO’s target sales level for this year is 64 trillion won for the entire group and 32 trillion won for the steelmaking headquarters alone.

By Bae Hyun-jung (tellme@heraldcorp.com)