1. KG Steel Q2 2025 Performance: Key Metrics

KG Steel reported revenue of KRW 776.2 billion, operating profit of KRW 43.8 billion, and net profit of KRW 48.1 billion for Q2 2025. Compared to the previous quarter, revenue decreased by 4.4% and operating profit plummeted by 33%, while net profit saw a modest 3.4% increase.

2. Drivers of Underperformance: A Multifaceted Analysis

Several factors contributed to KG Steel’s disappointing Q2 results, including the global economic slowdown, declining raw material prices, and fluctuating exchange rates.

  • Global Economic Slowdown: The ongoing global economic slowdown negatively impacted key demand drivers for KG Steel, including the automotive, shipbuilding, and construction industries.
  • Falling Raw Material Prices: The decline in HR COIL prices directly impacted KG Steel’s revenue.
  • Exchange Rate Volatility: Fluctuations in the KRW/USD exchange rate likely pressured KG Steel’s profitability, given the company’s reliance on exports.
  • Gold Price Fluctuations: Volatility in gold prices may have affected KG Steel’s financial investments and derivatives trading.

3. Outlook and Investment Implications

KG Steel’s future performance remains subject to a number of factors, including the pace of global economic recovery, stabilization of raw material prices, and the trajectory of exchange rates and gold prices. While uncertainty remains high, KG Steel is expected to focus on cost reduction, efficiency improvements, and diversification to enhance profitability. Investors should carefully consider these factors when making investment decisions.