Dongkuk Steel, Net Profit of 605.6 Billion KRW... 772% Increase Compared to Previous Year
[Asia Economy Reporter Donghoon Jeong] Dongkuk Steel announced on the 10th that it recorded consolidated preliminary financial results for last year with sales of 7.2403 trillion KRW, operating profit of 803 billion KRW, and net profit of 605.6 billion KRW.
Compared to the previous year, sales increased by 39.1%, operating profit by 172.5%, and net profit by 771.9%.
Dongkuk Steel attributed the record-high operating profit in 13 years to demand growth in front-end industries such as construction and home appliances, steel product price increases due to rising raw material prices, and expansion of high value-added product sales, emphasizing profitability-focused management. Net profit increased by 771.9% just one year after turning positive with 69.5 billion KRW in 2020. This was due to large-scale operating profits realized in the core steel business and equity-method gains added from the Brazilian CSP steel mill, which posted about 700 billion KRW (preliminary) in operating profit.
The increase in net profit led to improved financial stability. The debt ratio, which was 207% during the 2015 restructuring, decreased to 125% in 2021, a 29 percentage point reduction compared to 2020. Through strengthening financial soundness, Dongkuk Steel upgraded its corporate credit rating from ‘BBB- (stable)’ to ‘BBB (stable)’ last year and plans to continuously improve profitability and stability to pursue further credit rating upgrades.
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On the 10th, Dongkuk Steel’s board of directors reviewed the financial statements and resolved to double the cash dividend to 400 KRW per share as part of its shareholder-friendly policy. This year, Dongkuk Steel plans to implement smart factories, expand investment in eco-friendly steel processes, expand global color steel sheet bases in Mexico and Vietnam, and strengthen marketing such as steel shops. In particular, as part of practicing ESG management, investment in the environment, safety, and health sector will be more than doubled compared to last year.
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