Paragraph entered by Atlantic migration, in order for SteelFirst articles to display correctly on Metal Bulletin.

The figure represents a downturn for the company, which is South Korea’s third-largest steelmaker. In 2013, the mill had swung to an operating profit of 81.1 billion Won ($73.5 million).

In a short statement posted on its website on Wednesday February 11, Dongkuk said its profitability deteriorated because of shrinking demand from the shipbuilding and construction industries, the main buyers of its steel products.

Both its sales shipments and average selling prices went down on a yearly basis, the company said, without revealing any of these figures.

It disclosed, however, that its sales revenues dropped 9.3% over the period to 6.06 trillion Won ($5.5 billion).

The company also suffered a net loss of 292.5 billion Won ($265 million), which compares with a net loss of 118.4 billion Won ($107 million) in 2013.

Dongkuk noted that its merger with its cold rolled, coated and painted steel subsidiary Union Steel was completed on January 1 and will help it face the current sluggish market situation. 

Following the merger completion, it has now both hot rolled flat steel and cold rolled coil (CRC) businesses, it said.

At the time it announced the merger in October last year, Dongkuk said the move would make it diversify its sales portfolio and deal with increasing domestic competition, especially from Posco and Hyundai Steel – respectively the first and second biggest steelmakers in South Korea.

Veronica Qin in Shanghai contributed to this article.