Posted on 20 Aug 2015
Dongkuk Steel Mill, the country’s third-largest
steelmaker, saw a turnaround in operating profits in the second quarter.
The steelmaker said it posted 53.9 billion won ($45.5 million) in operating
profits, up 9 percent from the same period last year. Net profit was 156.8
billion won in the April-June period, while it posted 1.49 trillion won in
sales.
“Sales of colored plates, cold-rolled steel products and steel rods were stable
in the second quarter,” a Dongkuk spokesman told reporters. “The sale of our
headquarters building Ferrum Tower in downtown Seoul in the first quarter also
contributed to the rebound of profit.”
The company said it expects to see profits continue to grow in the third
quarter when its latest business reshuffle begins to take effect. The company
recently centralized its thick plate businesses in Dangjin plant in South
Chungcheong Province to scale down the organization for operating cost
reduction.
The steelmaker has been going through some tough transitions within the company
and the industry as a whole, hit by price-competitive Chinese products and the
slowdown of the shipbuilding industry.
Suffering from oversupply, the company rolled out a set of bold restructuring
plans to cut costs in the thick plate businesses, such as suspending the
operation of its second thick plate plant in Pohang, North Gyeongsang Province,
from August 1.
The company now only runs the first plant in Dangjin to produce thick plate
products.
The recent arrest of Dongkuk chairman Chang Sae-joo over allegations of
irregular practices also dealt a huge blow to the company morale and stock
prices earlier this year.
Chang later stepped down from the post over suspicions of embezzling about 20
billion won from the company and of habitual illegal gambling.
The company is now run under the leadership of Chang’s younger brother and vice
chairman Jang Seh-wook.
