POSCO Chairman Kwon Oh-joon poses with the staff with slab-making plant at Pohang Steelworks where he made an inspection tour on Jan. 2.

POSCO Chairman Kwon waves POSCO’s flag celebrating the 50th anniversary at a ceremony to kick off the 2018 business year at the POSCO Center in Seoul on Jan. 2. (Photos: POSCO)

POSCO has declared a new leap forward on the occasion of its 50th anniversary this year as the Korean steelmaker wraps up about 150 restructuring programs over four years. 

POSCO, whose fundamentals improved after restructuring was initiated in 2014, said it plans to concentrate investments into such growth engine projects such as energy and materials and raise management efficiency by grafting smart technology in the conventional steel business. 

Under the stewardship of Chairman Kwon Oh-joon, who took office in March 2014, POSCO said it finished about 150 restructuring projects, which have had an effect of improving the financial structure worth 7 trillion won. Approximately 40 billion won in annual losses will be saved. 

The number of POSCO’s subsidiaries, which once rose to 71, is almost halved to 38 and POSCO saws its overseas subsidiaries decline from 181 to 124. POSCO Specialty Steel was disposed of to SeAh Group for 1.1 trillion won in late 2014, while machinery manufacturing and distribution businesses were integrated into POSCO Daewoo. Such low-profit, non-core businesses as POSCO LED, Ponutech and Inju Auto Park were disposed of, and Korean and overseas losses-incurring businesses, including POS-HiAL were sold. 

POSCO, who repaid more than 5 trillion won in borrowings since the inauguration of Chairman Kwon, saw its debt ratio drop from 84.3 percent in late 2013 to 67.6 percent in the end of the third quarter of 2017, and its cash holdings surge from 5 trillion won to 8.55 trillion won. During the period, Moody’s Investors Service raised the rating for POSCO two slots from “Baa2 Stable” to “Baa Positive.” Thanks to the restructuring, POSCO is forecast to post more than 4.5 trillion won in operating profit last year, the best-ever-one in the past six years. 

POSCO decided to concentrate its capacities to nurture the energy and material sectors on the occasion of the 50th anniversary of its founding. 

While delivering a speech at a ceremony to kick off the 2018 business year at the Pohang Headquarters on Jan. 2, Chairman Kwon said the steelmaker will retain the global top position through high efficiency of steel production and gentrification of items. He urged his executives and staff members to do their best. 

The steelmaker plans to establish a stable growth regime in new businesses of energy storage materials and strengthen shared growth with related companies within the industry ecosystem. 

He set the 2018 business buzzword as “siwonyoomyeong,” which roughly translates as “Let’s look at a far-sighted perspective and take a positive viewpoint.”