SeAH Steel Holdings Achieves Sales Growth Driven by North American and LNG Demand

Revenue Growth Driven by Offshore Wind and Canadian Gas Pipeline Projects

SeAH Wind Expands Annual Capacity to 400,000 Tons... Full-Scale Production to Begin This Year

Profitability Expected to Improve in the Second Half on U.S. Price Hikes and Supply Shortages

SeAH Steel Holdings continued its external growth, driven by expanded sales of energy pipes in North America and revenue recognition from LNG projects. However, profitability weakened due to intensifying competition in the North American OCTG (Oil Country Tubular Goods) market and production disruptions in the Middle East.

On a consolidated basis, SeAH Steel Holdings reported that its first quarter sales this year increased by 4.7% compared to the same period last year, but operating profit fell by 59.0%. Despite sluggish domestic construction activity, increased sales of energy pipes for the North American oil and gas market drove revenue growth. On the other hand, a decline in selling prices due to intensified competition in the North American OCTG market, along with logistics and raw material procurement delays at SeAH Steel UAE, the company's Middle Eastern subsidiary, weighed on profitability.

On a separate basis, SeAH Steel's first quarter sales rose by 17.8% year-on-year, but operating profit decreased by 11.1%. This was attributed to increased revenue recognition from the Shinan Ui offshore wind power and the Canadian natural gas pipeline project, as well as higher sales volumes stemming from growing LNG demand in North America. However, profitability was dampened by U.S. steel tariffs and rising raw material costs.

The company forecasts that profitability will gradually improve from the second quarter onward, citing higher selling prices and supply shortages in the U.S. market. SeAH Steel Holdings also plans to expand sales of high-value-added products such as CRA (Corrosion Resistant Alloy) pipes in response to increasing demand for energy transition sectors, including LNG, CCUS (Carbon Capture, Utilization, and Storage), hydrogen, data centers, and power infrastructure.

SeAH Wind has increased its offshore wind substructure production capacity from 240,000 tons per year to 400,000 tons and has now entered the ramp-up phase. The company plans to commence full-scale commercial production within the year, aiming to supply the Vanguard project and secure additional orders.

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