Posco promises 53 trillion won of investment over 5 years

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Posco promises 53 trillion won of investment over 5 years

Published: 26 May. 2022, 17:30 Updated: 26 May. 2022, 19:42

Posco logo at the company’s steel plant in Pohang, North Gyeongsang. [POSCO]

Posco on Thursday announced that it will be investing a total of 53 trillion won ($41.9 billion) over the next five years. Of that, 33 trillion won will be invested locally.

The steelmaker will be hiring 25,000 people over that period.

Posco said it plans to invest 20 trillion won by 2026 in establishing the foundations for environment-friendly steel production; 5.3 trillion won on developing rechargeable battery materials and hydrogen technologies; 5 trillion won on environment-friendly infrastructure; and 2.7 trillion won on venture investment and sourcing new technology.

The steelmaker said the purpose of the investment is to strengthen the competitiveness of its core businesses, contribute to national economic and industrial development and lead the industrial trend.

The company said it is focusing on seven businesses in addition to steel, including rechargeable battery materials, lithium and nickel, hydrogen, energy, construction and infrastructure and food.

Posco hopes to triple the value of the company by 2030.

In March, it became a holding company. The steel business and other business, such as Posco Chemical, Posco E&C, Posco Energy and Posco International, are under the holding company.

Posco International has grain terminals abroad, a rice-polishing mill in Myanmar and palm oil farms.

The transition to a holdings company was part of a shift away from being only known for its steelmaking while strengthening the competitiveness of other businesses.

Its steelmaking brand was seen as a drag on the company's valuation in the market.

The steelmaker in 2021 reported record-breaking earnings.

Revenue grew 32.1 percent to 76.4 trillion won, while operating profit grew 284.4 percent to 9.2 trillion won, both new records. Net profit surged 302.4 percent to 7.2 trillion won.

It reported a 32.8 percent increase in its revenue in the first quarter of this year at 21.3 trillion won.

Operating profit grew 43.9 percent year-on-year to 2.3 trillion won and net profit surged 67.5 percent to 1.9 trillion won.

BY LEE HO-JEONG [lee.hojeong@joongang.co.kr]