Hyundai Steel Reports Operating Loss of 29.7 Billion KRW in Q1... Deficit Size Decreases

Securing Core Competitiveness through Performance Innovation and Equipment Robustness

[Asia Economy Reporter Hwang Yoon-joo] Hyundai Steel announced on the 24th that it recorded sales of 4.668 trillion KRW, an operating loss of 29.7 billion KRW, and a net loss of 115.4 billion KRW on a consolidated basis for the first quarter of this year.

Due to sluggish demand in upstream industries caused by the spread of the novel coronavirus disease (COVID-19) and delayed business recovery of overseas subsidiaries in regions such as China, operating losses occurred in the first quarter following the fourth quarter of last year. However, the company explained that the deficit was significantly reduced compared to the operating loss of 147.9 billion KRW in the fourth quarter of last year.

Hyundai Steel has strengthened technical sales targeting global automobile makers and closely responded to customer demand by focusing its capabilities on selling high value-added products. In the first quarter alone, it sold 2.094 million tons of global premium products and plans to sell 9.106 million tons this year.

In the long steel market, the company is optimizing its production system according to the construction market situation and is focusing on normalizing the market by fundamentally responding to low-priced distribution and processing orders.

Additionally, to strengthen business competitiveness and core capabilities, Hyundai Steel has declared and is executing the company-wide innovation activity HIT (Hyundai Steel: Innovation Together). It is fully committed to securing liquidity through aggressive cost reduction and the sale of non-core assets, as well as promoting a full-scale business restructuring in response to the current management crisis.

On the 1st of this month, through the physical spin-off of the forging business division, 'Hyundai IFC Co., Ltd.' was launched, implementing a two-track strategy focusing on the core steel materials division and establishing an independent management system for each division.

Furthermore, recognizing the importance of ESG management encompassing environment, society, and governance, Hyundai Steel has further systematized the 'Sustainable Management Governance' structure and newly formed a Sustainable Management Implementation Council. This council will maintain close communication with the Transparent Management Committee composed of outside directors and will be responsible for ESG mid-to-long-term strategies and major decision-making.

In response to strengthened automotive safety regulations and environmental regulations, Hyundai Steel is accelerating the development of high-strength and lightweight new steel grades. It also operates an AE (Application Engineering) technology content platform to secure competitiveness in the rapidly changing automotive steel sheet market.

Hyundai Steel developed an ultra-high-strength material to improve crash performance and fuel efficiency, producing a high-toughness hot-stamping steel for center pillars that achieves an 8.5% weight reduction while enhancing crash performance compared to existing materials. This was newly applied to the Hyundai Motor Company's newly released Avante this year.

A Hyundai Steel official said, "Although uncertainty in the management environment continues due to the global economic downturn caused by the spread of COVID-19, all employees will strive to improve profitability through strengthening core competitiveness and improving organizational health."

This content was produced with the assistance of AI translation services.