Hyundai Steel’s Critical Q2 2025 Earnings Call (What’s Happening?)

Hyundai Steel has officially announced it will hold a domestic non-deal roadshow (NDR) on Monday, July 28, 2025, at 9:00 AM KST to present its Q2 2025 earnings and host a Q&A session. This is a vital communication platform to address market concerns following its Q1 performance and to present a clear vision for the path forward.

Recap: Why Did Hyundai Steel Stumble in Q1? (Why?)

Hyundai Steel’s Q1 operating loss was not due to a single factor but a combination of headwinds. The primary causes for the poor performance were:

  • 📉 Economic Slowdown & Cheap Imports: Weak demand from key industries (automotive, construction) both at home and abroad, coupled with an increase in low-cost steel imports, directly hit sales volume and prices.
  • 📈 Rising Raw Material Costs: A surge in the prices of key raw materials like iron ore and coking coal increased the cost of production.
  • 💸 Derivative-Related Losses: Unexpected losses were incurred from derivative products used to hedge against currency and commodity price fluctuations.

However, analysts note that the company’s long-term fundamentals may not be significantly impacted, given its ongoing investments in future growth, such as the new Coke Dry Quenching (CDQ) facility and the development of 3rd-generation steel plates.

The Two Scenarios for Q2 and Beyond (So What?)

The outcome of this conference call can be broadly categorized into two scenarios, which will likely lead investors to re-evaluate the company’s worth.

  • ✅ The Bull Case: Restoring Confidence & Sparking a Rally
    If Q2 results are strong enough to dispel market fears and the company provides a convincing rationale for a recovery in the steel market, the stock could gain upward momentum. A clear strategy to counter cost inflation and a robust risk management plan to prevent future losses would be key to restoring investor confidence.
  • ❌ The Bear Case: Lingering Uncertainty & Stock Pressure
    If Q2 earnings are also disappointing or the explanation for Q1’s issues is deemed inadequate, investor sentiment could worsen. A pessimistic outlook on the global economy—citing risks like US/EU rate hikes and China’s slowdown—without a credible mitigation plan would exert further downward pressure on the stock.

Investor’s Action Plan: Your Checklist for the Conference Call

For successful investing, be sure to verify the following four points during the conference call:

  • 1. Quantitative Q2 Performance: Check key financial metrics like revenue and operating profit against Q1 figures and market consensus. Whether it’s an ‘earnings surprise’ or an ‘earnings shock’ will set the short-term stock direction.
  • 2. Cost Management & Profitability Strategy: Scrutinize the company’s specific plans to defend its profitability against volatile raw material prices and foreign exchange rates.
  • 3. Risk Management Systems: Regarding the derivative losses from Q1, ask if there are enhanced internal controls and risk management systems in place to prevent a recurrence.
  • 4. H2 and Future Outlook: Look for a clear guidance on demand from key client industries (auto, shipbuilding, construction) and the company’s long-term growth strategy, including the development of high-value-added products.