POSCO Holdings

POSCO Holdings is a holding company built on steel, battery materials and infrastructure, with operations residing in its subsidiaries.

POSCO produces hot-rolled, cold-rolled, plate and electrical steel and remains the largest revenue pillar; on a standalone basis it posted Q2 2026 revenue of KRW 9.415tn and operating profit of KRW 274.0bn.

Battery materials comprise POSCO Future M (cathode and anode), POSCO Argentina (brine lithium), POSCO Pilbara Lithium Solution (lithium hydroxide) and POSCO HY Clean Metal (recycling).

Vertical integration from mineral resources through raw materials to finished materials, coordinated by the holding company, is the group's differentiator.

Cathode capacity spans Gwangyang, Pohang and a Chinese joint venture for a combined 175,000 tons per year, with plans to reach 395,000 tons as new plants come online.

Infrastructure covers POSCO International (gas fields, LNG, palm oil, trading) and POSCO E&C (construction); in Q2 2026 POSCO International delivered a record quarterly operating profit on gas fields in Myanmar and Australia plus its Indonesian palm business.

The customer base spans traditional autos, shipbuilding, construction and appliances, and increasingly battery cell makers and automakers. Management frames its portfolio as a Triple Core strategy of industrial resources (steel), strategic resources (lithium, rare earths, rare gases) and energy resources (LNG).

Competitively, the group faces Hyundai Steel and Dongkuk at home while contending with large Chinese and Japanese mills and specialised lithium and cathode players abroad.

Annual results contracted for four straight years: 2022 revenue of KRW 84.750tn and operating profit of KRW 4.850tn (5.7% margin), 2023 KRW 77.127tn and KRW 3.531tn (4.6%), 2024 KRW 72.688tn and KRW 2.174tn (3.0%), and 2025 KRW 69.095tn and KRW 1.827tn (2.6%).

Net profit attributable to owners fell to KRW 657.7bn in 2025, roughly one-fifth of the KRW 3.144tn earned in 2022, while operating cash flow declined from KRW 6.664tn in 2024 to KRW 4.572tn in 2025.

Quarterly data show Q4 2025 as the inflection point, with revenue of KRW 16.841tn, operating profit of just KRW 12.7bn and a net loss attributable to owners of KRW 225.4bn.

On its earnings call the company attributed roughly KRW 190bn of losses to a POSCO E&C construction halt and bad-debt charges and about KRW 131.9bn to one-off costs tied to the sale of the Zhangjiagang plant in China, adding that these items are not expected to recur in 2026.

Results then improved for two consecutive quarters: Q1 2026 revenue of KRW 17.876tn, operating profit of KRW 706.8bn and net profit to owners of KRW 467.2bn, followed by Q2 2026 revenue of KRW 19.259tn, operating profit of KRW 819.0bn and net profit to owners of KRW 684.8bn.

The quarterly operating margin recovered from about 0.1% in Q4 2025 to roughly 4.0% in Q1 2026 and 4.3% in Q2 2026.

The recovery leans on resources and infrastructure rather than the core mill: battery materials posted KRW 41.0bn of operating profit in Q2 2026, its first profit in nine quarters, while POSCO Pilbara Lithium Solution narrowed its operating loss to about KRW 1.0bn on revenue of KRW 102.0bn.

Over the four quarters from Q3 2025 to Q2 2026, net profit attributable to owners totalled about KRW 1.347tn, already well above the full-year 2025 figure.

The balance sheet was little changed, with 2025 year-end equity of KRW 62.378tn against liabilities of KRW 42.815tn for a debt-to-equity ratio of 68.6%, versus 68.9% in 2022.

The steel cycle is widely described as entering an early normalisation phase after three years of contraction. Korea has imposed anti-dumping duties of 27.91-38.02% on Chinese plate, 31.58-33.43% on Japanese hot-rolled coil and 28.16-33.10% on Chinese hot-rolled coil.

On supply, Chinese crude steel output fell 4.6% year on year to about 247.55mt in Q1 2026, with Beijing pursuing roughly 50mt of annual output cuts and tighter export management. Demand recovery, however, looks modest: worldsteel projected 2026 global steel demand of 1,772.5mt, up 1.3% from 2025.

Sceptics argue much of the price rebound is normalisation from below-cost levels, making the durability of announced price hikes the key variable.

Regulatory costs are also rising: the EU carbon border adjustment mechanism that took effect in January is projected to add about KRW 2.644tn of costs over nine years, while a 50% US tariff remains a live variable.

Domestically the company retains scale leadership: in Q2 2026 POSCO's steel operating profit was KRW 274.0bn versus KRW 57.7bn at Hyundai Steel.

Lithium, meanwhile, is on a different cycle: Korea Mine Rehabilitation and Mineral Resources Corp data showed lithium at USD 20.92 per kilogram in late April, up 118.14% from the prior-year average.

Management says it will pursue profitability gains and strategic investment under the Triple Core strategy on the back of first-half results.

The lithium roadmap is specific: management flagged a temporary Q3 slowdown from seasonal maintenance in Argentina, a return to full operation in Q4 with certified product sales starting gradually, and said Q4 should exceed Q2 results.

The second POSCO Argentina plant is scheduled for overall completion in Q4 2026, adding 25,000 tons of technical-grade lithium carbonate capacity.

Phases 3 and 4 target 100,000 tons per year and a shift to lithium carbonate, with a pre-feasibility study due by end-2026 and a final investment decision expected by end-2027; a hard-rock lithium joint venture with Mineral Resources is slated for October 2026, and a rare-earth partnership with ReElement Technologies targets commercial production in 2028.

In steel, the 50:50 joint venture with JSW Steel in Odisha will build a 6mt integrated mill, with 48 months of construction targeting completion in 2031.

On capital allocation, the restructuring target was raised to 129 cases and KRW 3.5tn of cash generation by 2028, with 85 cases and KRW 2.2tn completed on a cumulative basis as of the first half.

The company also said 90% of proceeds from listed subsidiary stake sales will fund growth businesses and 10% will fund buybacks and cancellations, with KRW 350bn earmarked to offset roughly KRW 80bn of annual dividend income lost from those sales.

Among sell-side forecasts, Eugene Investment & Securities on 1 September 2026 projected 2026 consolidated revenue of KRW 74.400tn and operating profit of KRW 3.039tn.