POSCO's operating profit drops 18% in 2013

South Korea's top steelmaker POSCO posted an 18 percent drop in operating profit in 2013 due to global oversupply and sluggish demand for steel amid the global economic downturn, a regulatory filing showed Tuesday. Consolidated operating profit reduced 18 percent from a year earlier to 2.99 trillion won (2.77 billion U.S. dollars) in 2013, according to the regulatory filing. Revenue fell 2.7 percent to 61. 86 trillion won, and net income tumbled 43.2 percent to 135.5 billion won. The ratio of operating profit to revenue declined 0.9 percentage point to 4.8 percent in 2013, falling below the 5 percent level. The steel unit alone saw its operating profit drop 20.6 percent in 2013 from a year earlier, with the revenue falling 14.4 percent. Energy and chemical businesses, which led the company's past earnings growth, became sluggish. The sluggish earnings were attributed to weak demand for steel products caused by the global economic slump and lower product prices arising from global oversupply. POSCO's steel production reduced 4.1 percent on year to 36.41 million tons in 2013, with steel sales declining 3 percent to 33. 93 million tons.